Sustainability is now a core consideration in property investment. Alongside financial performance, investors increasingly look to independent benchmarks and ratings to understand how properties and funds manage environmental, social and governance (ESG) risks and opportunities. These benchmarks provide a consistent way to assess performance, benchmark assets and identify leaders across the market.
On this page:
What is an ESG benchmark?
An ESG benchmark or rating is an independent framework used to measure and compare sustainability performance. In real estate, these frameworks assess everything from energy efficiency and carbon emissions to governance practices, health and wellbeing outcomes, and responsible investment processes.
Much like financial reporting standards help investors assess financial performance, ESG benchmarks and ratings create transparency and comparability across the property sector.
Why do ESG benchmarks exist?
Benchmarks and ratings exist to provide consistency in how these factors are measured and reported. They help investors distinguish between self-reported claims and independently verified performance.
Why do ESG benchmarks matter to investors?
For investors, ESG benchmarks and ratings provide valuable insights beyond traditional financial metrics. They can help investors:
- understand asset level emissions, energy efficiency, water and waste diversion performance
- understand how assets are managing climate-related risks and opportunities
- compare performance across different funds and portfolios
- assess how effectively a manager is integrating sustainability into decision-making
- identify assets that may be better positioned for regulatory, market and customer expectations
- evaluate long-term resilience and value creation.
Independent benchmarks also improve transparency, giving investors greater confidence in the information being reported.
The main ESG benchmarks, ratings and certifications in real estate
GRESB
What it measures | Level | Scale | Who runs it | Geography |
|---|---|---|---|---|
Portfolio ESG performance and management | Fund / portfolio | Score out of 100, percentile ranking and Sector Leader status | GRESB | Global |
GRESB is one of the most widely used ESG benchmarks for real estate and infrastructure globally. It assesses how property funds and portfolios manage ESG risks and opportunities, covering areas such as governance, climate strategy, stakeholder engagement, data management and performance outcomes.
GRESB enables investors to compare managers and portfolios using a consistent global framework. Charter Hall's funds participate in GRESB alongside many of the world's leading property investment managers. In FY26, five Charter Hall Office funds ranked among the top 10 globally, and Charter Hall was recognised as a Regional Sector Leader, ranking first in Australia across the Unlisted Office, Retail and Industrial peer groups.
NABERS
What it measures | Level | Scale | Who runs it | Geography |
|---|---|---|---|---|
Operational energy, water, waste and indoor environment quality | Asset | 0-6 stars | NABERS (NSW Government) | Australia |
NABERS (National Australian Built Environment Rating System) is Australia's leading environmental performance rating system for buildings. It measures actual operational performance across categories such as energy, water, waste management and indoor environment quality.
A higher NABERS rating reflects stronger operational efficiency and lower environmental impact. Because ratings are based on measured performance, NABERS provides investors with a practical view of how buildings perform in operation.
In FY26, Charter Hall achieved a 5.0 star NABERS Energy portfolio rating for Office, covering 100% of eligible office assets by area, and a 5.3 star NABERS Energy portfolio rating for Convenience Retail, covering 89% of eligible convenience retail assets by area. The Group also maintained a 5.0 star or higher NABERS Indoor Environment rating across 1.5 million square metres of eligible office assets, demonstrating a continued focus on both building efficiency and occupant experience.
Green Star
What it measures | Level | Scale | Who runs it | Geography |
|---|---|---|---|---|
Design, construction, fit-out and operational sustainability | Asset and fit-out | 1-6 stars | Green Building Council of Australia (GBCA) | Australia |
Developed by the Green Building Council of Australia, Green Star assesses the sustainability performance of buildings and fit-outs across their design, construction and operation.
Ratings range from 1 Star Green Star through to 6 Star Green Star. Green Star helps investors understand how sustainability has been embedded into an asset's lifecycle and overall environmental performance.
In FY26, Charter Hall maintained Australia's largest Green Star Performance rated portfolio across Office, Retail and Industrial & Logistics asset classes. Eighteen Office assets achieved the highest possible 6 Star Green Star Performance rating, recognising world leadership in sustainable building operations.
WELL
What it measures | Level | Scale | Who runs it | Geography |
|---|---|---|---|---|
Human health and wellbeing outcomes | Asset or organisation | Certified to Platinum | International WELL Building Institute (IWBI) | Global |
The WELL Building Standard focuses on people. It measures how buildings support the health, wellbeing and experience of occupants through factors such as air quality, water, light, movement, comfort and mental wellbeing.
As workplaces continue to evolve, WELL provides investors with insight into how assets support productivity, wellbeing and tenant satisfaction.
In FY26, Charter Hall maintained Australia's largest WELL at Scale portfolio, representing more than 1.7 million square metres, achieved Platinum WELL Certification at 555 Collins Street, 480 Swan Street and 60 King William Street, and had nine Office developments registered for full WELL Certification. These certifications help demonstrate a commitment to delivering healthier workplaces that support both tenant experience and building performance.
PRI
What it measures | Level | Scale | Who runs it | Geography |
|---|---|---|---|---|
Responsible investment practices | Investor or fund manager | Transparency reporting and assessments | UN Principles for Responsible Investment | Global |
The Principles for Responsible Investment (PRI) are a globally recognised framework supported by the United Nations. Signatories commit to incorporating ESG considerations into investment analysis, decision-making and ownership practices.
PRI participation demonstrates a manager's commitment to responsible investment and ongoing transparency regarding ESG integration. Charter Hall has been a signatory since 2008. In FY26, Charter Hall achieved 5 stars in the 2025 Transparency Report across all categories, a one star increase on the prior year.
How to read an ESG benchmark
When reviewing sustainability benchmarks and ratings, it is important to understand what each measures and the level at which it applies.
Consider:
whether the rating applies to a single building, a portfolio or an entire organisation
the methodology used by the framework
whether ratings are independently verified
how current the rating is
how performance compares with market peers.
No single benchmark or rating tells the full story. Investors often review multiple together to build a more complete picture.
How investors use benchmarks to make decisions
Investors use sustainability benchmarks and ratings to:
compare investment managers and portfolios
assess risk management capabilities
evaluate climate resilience, resource efficiency and progress toward net zero emissions targets
understand how sustainability is embedded in governance and operations
inform responsible investment decisions.
Increasingly, benchmarks and ratings are used alongside financial indicators to inform investment strategy and support a more holistic assessment of long-term value.
What are the benefits and risks of using ESG for investment decisions?
ESG can help investors identify risks and opportunities that may not be captured by traditional financial analysis alone. It provides additional insights into how companies manage issues such as climate risk, governance, workforce practices and long-term resilience. Strong ESG performance may also support transparency, risk management and operational efficiency.
However, ESG is not a guarantee of investment performance. Ratings and methodologies can vary between providers, making comparisons difficult, and ESG factors may be interpreted differently by investors. Like any investment approach, ESG data should be considered alongside financial analysis and other investment considerations.
How Charter Hall applies independent benchmarks
Charter Hall's approach to sustainability includes the use of independent benchmarks and ratings to measure performance, drive continuous improvement and provide transparency for investors. Our strategy and outcomes are benchmarked against independent tools to measure outcomes and provide insight into operational performance and ESG progress.
These benchmarks and ratings are applied across both portfolio and asset-level activities and are supported by external frameworks including GRESB, Green Star, WELL, NABERS and PRI. Charter Hall also reports sustainability performance through a broader reporting framework aligned with initiatives such as GRI, the UN Sustainable Development Goals and the UN Global Compact.
Frequently asked questions
What does ESG stand for?
ESG stands for the environmental, social and governance (ESG) criteria used to assess how an organisation manages sustainability-related risks and opportunities.
Environmental: Factors such as energy use, carbon emissions, water consumption, waste and biodiversity.
Social: Outcomes relating to people, including health, wellbeing, safety, diversity and community impact.
Governance: The systems, policies and oversight that support ethical and responsible decision-making.
It refers to the non-financial factors used to assess how an organisation manages sustainability-related risks and opportunities
How are ESG ratings calculated?
ESG ratings are calculated using methodologies specific to each framework. These typically assess a combination of policies, management systems, performance data, governance practices and verified outcomes.
How does sustainable investing work?
Sustainable investing incorporates ESG factors into investment analysis and decision-making. Investors use sustainability data alongside financial information to assess how organisations manage risks, opportunities and long-term performance.
Do sustainable investments perform better?
Sustainability ratings are not designed to predict investment returns. However, they can provide insights into how assets are managing risks, improving efficiency, meeting stakeholder expectations and positioning for long-term resilience. Investors often use ESG information alongside traditional financial measures when making investment decisions.
How is ESG investing different to SRI (Socially Responsible Investing)?
While both approaches consider sustainability, they differ in how investment decisions are made. SRI is primarily values-based, using ethical screens to exclude certain industries or activities. ESG investing focuses on assessing environmental, social and governance factors that may influence a company's long-term performance, resilience and risk profile.
Are REITs the same as property funds?
Some property funds are structured as REITs, while others are not. The structure affects liquidity, pricing and access.
How do I invest in REITs in Australia?
You can invest in REITs through the ASX, via a financial adviser or directly with a fund manager, depending on the structure.
What do REITs invest in?
REITs typically invest in income‑producing commercial property such as office, industrial, retail and social infrastructure assets.
Do REITs pay income?
Many REITs aim to distribute income, though this depends on performance and market conditions.
Are REITs risky?
Like all investments, REITs involve risk, including market and property‑specific risks.
Are REITs good for beginners?
REITs can offer accessible property exposure, but beginner investors should understand how REIT investing works in Australia and consider their risk tolerance.
Can I invest in REITs through my SMSF?
Many SMSFs invest in REITs, subject to trust deed rules and investment strategy considerations. SMSF investors should also consider tax implications, as regular income distributions from A-REITs are typically taxed as ordinary income and capital gains may affect overall returns within the fund structure.
What is the difference between listed and unlisted REITs?
Listed REITs trade on the ASX and offer liquidity, while unlisted REITs have different valuation and withdrawal characteristics.
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