From our practice: What does a meaningful ESG strategy look like? We demonstrate at Crestyl

ESG strategy is now issued by a number of companies. It is not a document that is mandatorily required to meet standardised requirements and the quality can vary widely. So what should a strategy look like that will stand up to banks and partners and help a firm with mandatory ESG reporting? We present the key points with a practical example of an ESG strategy for the Czech real estate group Crestyl.

Which topics to include and what to set ambitions for?

The first step in developing an ESG strategy is to select the topics it should cover. Especially if the company is facing mandatory ESG reporting, it is advisable to conduct at least an initial part of the materiality impact assessment before writing the strategy. This means mapping typical impacts, threats and opportunities in the sector and identifying issues specific to the company.

In the case of the Crestyl real estate group, Frank Bold was able to draw on our experience with developers and good knowledge of relevant EU legislation and sectoral initiatives. This enabled us to identify exactly what areas needed to be focused on as part of the ESG strategy.

"We see companies sending out questionnaires all the time and having a materiality matrix created to identify material ESG topics. If a company is subject to mandatory ESG reporting, we recommend conducting a materiality analysis according to European Standards (ESRS) when preparing the strategy - according to ESRS, questionnaires and stakeholder engagement only serve as validation," explains Olga Kurda, Senior Reporting Consultant at Frank Bold Advisory.

The Crestyl Group has long profiled itself as a responsible and sustainable developer - we were therefore able to draw on their sustainability vision and upcoming green projects when setting commitments for individual themes. We also took into account examples of good sector practice and sector-wide direction, including the goal of achieving carbon neutrality by 2050.

"At Crestyl, we are committed to creating a positive impact on the world around us. It's not just about the written rules, but about our own beliefs and the active steps we want to take as a company. We believe that it will enable us to achieve harmony between economic growth, environmental protection and social contribution to the community in which we operate," said Simon Johnson, Crestyl's Managing Director in the Czech Republic.

Do you have a specific plan? And could we see it?

In order to give credibility to Crestyl's ESG commitments, each thematic section lists specific actions that will lead to the achievement of the commitment, as well as a list of time-bound goals and measurable indicators that will help Crestyl track progress towards each commitment.

Already during the preparation of the strategy, Crestyl discussed the feasibility of sub-objectives and measures within the company and with suppliers to avoid the risk of greenwashing.

What you will learn from Crestyl's ESG strategy:

• When and how will it get its direct (Scope 1) and indirect (Scope 2) emissions to zero
• What % of construction waste does it plan to prepare for recycling or reuse and from when
• How the engagement with the supplier's staff will take place

>>  More in Crestyl's ESG strategy

"An ESG strategy does not need to cover every detail - it may refer to other company policies or to policies and plans that the company is yet to adopt. But if it only includes a list of general commitments, it cannot meet the expectations of banks, clients or anyone else who reads it," adds Frank Bold Advisory's Kurda, adding that defining specific measures, targets and KPIs is also key for internal management of the overall strategy.

Developed sub-strategies

Implementation within the company is an integral part of the work on the strategy - without assigning responsibilities for specific projects arising from the strategy, setting a timetable and a control system, it is not possible to effectively manage the implementation of the ESG strategy. Therefore, the preparation of sub-roadmaps for individual strategy items was one of the priorities for Crestyl as soon as the document was approved.

"The goals and objectives outlined in the strategy are gradually being outlined through partial roadmaps for individual areas. We are developing the sub-strategies - decarbonisation, circular economy and gradually others to which we have committed. In parallel, we are already incorporating ESG principles into contracts with contractors and tenants, preparing the demolition of original buildings in two new projects with the greatest possible emphasis on circularity, and keeping a close eye on everything that comes up in connection with ESG issues - especially in our industry, of course," said Alena Liškay Králíková, ESG Manager at Crestyl Real Estate Group.

‍Get ahead with ESG reporting

We help companies set up an ESG strategy and prepare ESG reporting in accordance with the new European legislation, thus obtaining key data for their clients, business partners and financial institutions.