COP21 Landmark Climate Accord Affirms JLL's Focus on the Long-Term Sustainability of its Business & Client Advice

CHICAGO, December 22, 2015 /3BL Media/ - Following an historic Paris agreement where 195 nations committed to lowering planet-warming greenhouse gas emissions, JLL is looking ahead to consider how COP21 will affect JLL’s clients, employees and investors.

Sarah Nicholls, JLL’s Global Corporate Sustainability (GCS) team leader, and Dan Probst, JLL’s Global Chairman of Energy and Sustainability Services, participated in COP21 and you can read more about their experiences on JLL’s Green Blog. COP 21 was the first United Nations climate conference to gather experts from both the private and public sectors to address global climate change. Sarah shared her impressions on the landmark conference and what it means to JLL in reducing greenhouse gases across its global footprint and helping clients do the same.

Q: COP21 was the first global climate change conference to include both the private and public sectors to tackle global warming. What were your overall impressions of the conference proceedings? 

A: What resonated with me was the presence of big, multinational company CEOs – several of whom are JLL’s clients – who spoke with unwavering conviction about the economic drivers of climate change. This was echoed, too, by politicians such as US Secretary of State John Kerry who remarked that climate change was the biggest market opportunity in the history of humankind.  

I viewed the critical discussions and negotiations as a means to obtain a clearer understanding of the countries’ respective positions and how this would provide certainty and a unified signal for business action.

Q: One conference session particularly relevant to JLL’s global business concerned the Buildings Efficiency Accelerator (BEA) initiative. What are the links to JLL’s ongoing efforts to educate and guide its clients in energy reduction?

A:  The Sustainable Energy for All’s Energy Efficiency Accelerator Platform aims to double the rate of energy efficiency by 2030. Buildings is one of several accelerators such as Industry, District Energy Systems and Lighting that will help drive forward this energy efficiency goal.

Our industry leadership in property and corporate facility management services spans a portfolio of 3.4 billion square feet worldwide, so we have a vested interest in the building sector that accounts for about 40% of global energy consumption. The Buildings Efficiency Accelerator session at COP 21 was, not surprisingly, the one most relevant to JLL.

The BEA encourages widespread implementation of progressive policies that boost the use of best available technologies, low-energy building design and energy efficient renovation that can deliver 25-50% reductions in energy demand from new and existing buildings. 

Q: Were there any examples of what U.S. companies were doing proactively to reduce their CO2 emissions that you found particularly progressive?

A:  As you might imagine, technology companies like Google and Microsoft are leading the way in reducing their carbon footprints. Google, for example, has been carbon neutral since 2007. Google described how long-term (10-20 years) renewable energy contracts (committed to using renewable energy) help create financial certainty, but may not be something that a building landlord wants to sign given the duration. So they, as well as others in the industry, are still trying to figure out which constructs make the most sense to achieve the scale that is crucial to drive down costs for renewable energy.

Regarding Microsoft, I learned more about their internal carbon fee in Paris. Microsoft spoke to the power of putting carbon on a company’s profit and loss statement. And in Microsoft’s  experience, the carbon fee also helps to provide an accountability mechanism. So even for a company like JLL that has a total carbon footprint of around 52,000 metric tons of CO2e (compared to 30,000+ metric tons of CO2e for Microsoft), a carbon fee may help speak in terms of money i.e. a tax instead of carbon. This could be the key to engaging a company’s business leaders such as the Chief Financial Officer. 

Q: Given JLL’s long-term involvement with the UN Global Compact and other global organizations dealing with climate change, do you foresee additional engagement with other organizations moving forward?

A:  We’re committed to: continued involvement with the UN Global Compact; active participation in green building councils around the world; a longer-term collaboration with the World Economic Forum where our CEO has been actively engaged; and steady interest as a Business Network member in the International Integrated Reporting Council (IIRC), which seeks to align capital allocation and corporate behavior to wider goals of financial stability and sustainable development. 

To show our support for a positive COP21 outcome, we joined the UN Caring for Climate initiative and the Non-state Actor Zone for Climate Action (NAZCA). We also used our time in Paris to better understand the vast array of external organizations that are driving forward climate changes actions both within our industry and more broadly. As encouraged by our CEO, this will help JLL carefully review our climate change partnerships so that we are involved in the most focused and relevant way possible. This is especially important considering how the conversation on climate change has significantly advanced in the last few years.

Q: How does the outcome of the Climate Change agreement align with JLL’s commitment to GHG emissions reduction and global sustainability?

A:  Since 2008 JLL has recognized the impact of GHG emissions and committed to helping our clients address energy and sustainability in their real estate. Over time, we have also recognized that we cannot credibly offer these services without doing the same in our own operations.

As a result, we set 3 targets in 2013 for JLL offices to reduce our own environmental footprint. Our latest Global Sustainability Report has details on these targets and our progress. COP 21 has spurred JLL to consider how we can reset our targets according to a longer timeframe and based on climate change science. We had considered this approach in 2013 and the Climate Change agreement provides extra impetus to raise our ambitious goals. 

This reminds me of a powerful theme from COP 21: the thresholds are continually getting higher and higher. Let’s take a simple example based on company scores in initiatives such as the Dow Jones Sustainability Index or CDP (formerly Carbon Disclosure Project). Companies may score X in year 1, then X+1 in year 2. Even though improvement has been shown in year 2, the market is actually starting to require X+3.

This means expectations are higher over a shorter duration. Companies that do not innovate and that cannot change will lose the race.  It’s great to see that the Climate Change agreement – and general tone of the conference – was that we’re all expecting more from one another. And that climate change is here to stay. 

Q: How do you see the COP21 conference outcomes and the Climate Change agreement being received by your company’s leadership and sustainability teams? 

A:  Ahead of the conference, JLL’s CEO sent a note to all staff worldwide, which was then followed shortly by a note from me and Dan to JLL’s internal sustainability stakeholders. The main aim of these notes was to make the firm’s presence at COP 21 known, and it has started a great dialogue in many different directions about JLL’s role in advancing climate change. It’s terrific to see that the momentum and positivity from Paris carry over into conversations within JLL as well.    

We certainly believe the conference outcomes are consistent with our long-term sustainability strategy, and our immediate plans include several briefings with JLL leadership to provide our COP 21 observations. We will also issue internal guidance that ensures our client account managers understand what COP 21 means for their clients across all sectors.

We see these developments as the perfect springboard to engage our clients and supply chain partners, further extending our influence beyond our business to create permanent, sustainable behavioral change.

Ultimately, our involvement in COP 21 – and even more so, the actions that we take following the Climate Change agreement – will help ensure we have a sustainable enterprise that clients, investors and employees can rely on for the long term. 

About JLL’s Sarah Nicholls 

Sarah Nicholls is JLL’s Global Corporate Sustainability (GCS) team leader. The GCS team focuses primarily on the sustainability strategy and reporting for JLL’s own operations across the 80 countries where JLL serves its clients. As the inaugural GCS team member, Sarah serves on the firm’s Global Operating Board alongside other corporate function leaders. She is currently pursuing a degree with the University of Cambridge’s Institute for Sustainability Leadership.