BELGIUM Trends and Developments Contributed by: Pieter Puelinckx, Yves Moreau, Bénédicte Deboeck and Melissa Verplancke, Linklaters
technologies and the use of hazardous materi - als. The CSRD, effective from 5 January 2023, demands reporting on ESG issues under EU sustainability standards. The in-scope compa - nies will have to report using CSRD rules for the first time in 2025 for the financial year of 2024. The updated rules of the CSRD will guarantee that investors and other stakeholders have the information necessary to evaluate how compa - nies affect the environment. Voluntary actions In addition to the mandatory disclosure obli - gations at (group) corporate level, real estate companies have a range of voluntary schemes and options at their disposal to boost their ESG profile. Green (clauses in) leases Green leases, which assign environmental responsibilities related to building maintenance, energy and water use, and environmental per - formance, are increasingly common in Belgium’s non-residential sector. They enhance investor portfolios by sustaining asset value and improv - ing efficiency, occupancy, and rents. Unlike neighbouring countries, Belgium lacks mandatory green clauses despite real estate ESG regulations. Demand is rising for sustain - ability-related clauses in large residential and commercial projects, covering waste, lighting, and heating. Comprehensive green leases main - ly pertain to non-residential buildings due to the EU Taxonomy Regulation’s focus on non-resi - dential energy standards. However, a property’s environmental impact encompasses more than just its energy efficiency rating. It also includes aspects such as waste generation, travel to and
from the building, and materials used in the fit- out. Certification schemes While not legally required in Belgium, many companies pursue sustainability certifications like BREEAM (Building Research Establishment Environmental Assessment Method), which rates sustainability in various buildings. BREEAM-cer - tified properties often achieve higher occupancy and rent, balancing extra costs. Investors are increasingly looking at the global ESG benchmark for real estate assets (Glob - al Real Estate Sustainability Benchmark, or GRESB). It aims to assess and benchmark ESG and other related performance of real assets and to provide standardised and validated data to investors. Each year, the Real Estate and Real Estate Development Benchmark is generated as part of the GRESB assessments, which are guided by what investors consider to be mate - rial issues and are aligned with international reporting frameworks such as the Paris Climate Agreement, the Task Force on Climate-related Financial Disclosures and the United Nations Sustainable Development Goals. Against this backdrop, investors can monitor their invest - ments, engage with their fund managers and make ESG-informed decisions. In Europe, in particular, investors increasingly require fund managers to achieve a sufficiently robust GRESB rating (eg, four out of five stars and/or higher than 80% scores) – failing which, they may not be prepared to invest in their funds or even look to withdraw their investment. Nonetheless, this remains a voluntary frame - work. The GRESB can be applied to companies and funds, rather than individual assets. It differs in that respect from asset-based green certifica -
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