Real estate investors’ maturity in using corporate social responsibility to develop sustainable properties

Pressing societal and environmental challenges influence real estate investment and development. Due to urbanization, gentrification, climate change and resource scarcity, the global call for more responsible and sustainable market behaviour has grown. As such, the notion of CSR has gained global attention in the real estate industry. Today, real estate investors voluntarily explore corporate solutions to societal and environmental issues. They setup organizational units to manage CSR programmes and report on CSR achievements. This has resulted in a vast amount of socially responsible behaviour and investment policies and reports, based on frameworks such as GRI, GRESB, ESG, LEED, BREEAM and WELL, which, in turn, appear to influence the chance for market success, reputation and value of companies.Although this suggests that CSR has become a common feature in the global real estate sector, the origin of CSR and its meaning and implementation in business practice are often unclear to practitioners – especially within Continental Europe. This stems from the fact that CSR is associated with the Anglo-Saxon model of society, and not with the Rhineland model of society which exists in north-western Europe. Yet, due to the connectedness of social and economic systems, the real estate sector in Continental Europe is under influence of AngloSaxon characteristics such as liberalization, privatization and deregulation – ingredients for CSR to flourish. This leads to the following research question: How do real estate investors use CSR to develop sustainable properties?In order to answer the research question, a cross case analysis is performed based upon semi-structured interviews and document review. The cases (i.e., real estate investment companies) are chosen from Anglo-Saxon countries, being the USA and Hong Kong, and from a Rhineland country, being the Netherlands. CSR usage is analysed on (a) the strategic level of the case companies, (b) the institutional level (CSR reporting) and (c) the project level (construction projects). Based upon the common CSR characteristics of the Anglo-Saxon and Rhineland practices – as far as represented by the selected cases – a CSR maturity model for real estate investors is developed. The model is used to rank the maturity of the CSR programmes of the three real estate investors studied.A number of common characteristics are found in the use of CSR. All real estate investors studied (a) use a formal materiality assessment to determine important core business related CSR issues; (b) aim to formulate CSR goals that are specific and measurable; (c) strive to find a CSR management structure that fits the characteristics of the company; and (d) use CSR and sustainability certification methods and reporting guidelines as a structuring device for setting up a CSR policy. Furthermore, it became apparent that only a minor part of the material issues used by the case companies relates to the actual built environment. Finally, the maturity of CSR use by the three real estate investors differs substantially, as illustrated by the higher level of maturity of, in order, the Hong Kongese, American and Dutch case.