ESG Developments: Strengthening Sustainable Investment Practices

Regulatory Advancements and Transparency

A major milestone was the publication of the revised "Self-Regulation on Transparency and Disclosure for Collective Investment Schemes with Sustainability References" (Version 2.0) by the Asset Management Association Switzerland (AMAS) in summer 2024. This updated framework refines sustainable investment approaches, enhancing clarity and comparability in ESG reporting.

One of the dominant topics for investment managers throughout 2024 was the collection of measurable consumption data and the calculation of key performance indicators (KPIs) using the REIDA methodology, which remains a focal point in sustainability assessment.

Sustainable Investment Approaches

In alignment with the AMAS guidelines, we have adapted our investment strategy to incorporate a structured approach to sustainable investing. Key ESG investment strategies include:

• Exclusions: Systematic exclusion of issuers whose business activities or practices violate predefined ethical norms or pose significant sustainability risks.
• ESG Integration: Incorporation of sustainability risks and opportunities into traditional financial analysis and investment decision-making processes, based on systematic methodologies and reliable research sources.
• Stewardship (Active Ownership): A combination of voting rights and active dialogue (stakeholder engagement) to influence behaviour on ESG matters.
• Voting Rights: Exercising voting rights to express preferences on sustainability-related issues.
• Engagement: Proactive dialogue with shareholders and other relevant stakeholders to encourage adherence to ESG principles, with a commitment to the Net-Zero 2050 target.
• Climate Alignment: A strategy to reduce carbon emissions over time, ensuring investment portfolios contribute to a long-term net-zero goal.

Key ESG Priorities for 2025

Looking ahead, 2025 is expected to bring further advances in ESG integration across the Swiss investment landscape. The key areas of focus include:

• Widespread Adoption of REIDA Metrics: By 2025, nearly all fund providers are expected to calculate environmental impact metrics using the REIDA methodology, with only a few still finalising their transition.
• Improving Data Quality & Measurement Scope: The next major challenge will be increasing the share of measured data, thereby enhancing data reliability and comparability.
• Standardisation of Greenhouse Gas (GHG) Reduction Pathways: A standardised methodology for displaying GHG reduction trajectories is expected to be introduced in 2025. Several asset managers are actively working on solutions in collaboration with the Swiss Federal Office for the Environment (FOEN).
• Defining and Standardising ‘Grey Energy’ Measurement: A consensus is being sought on how to define and measure embodied energy in buildings, ensuring greater transparency and comparability across investment portfolios.
• Industry-Wide Collaboration: A constructive and solution-oriented dialogue continues within the Swiss real estate investment universe, reflecting a collective commitment to overcoming ESG-related challenges and driving sustainable transformation.

For more details on the AMAS self-regulation framework and sustainable finance principles, please click here.

Conclusion: Strengthening ESG Integration

As regulatory standards become clearer and ESG data improves, sustainable investing is set to play an even more central role in real estate and broader asset allocation. The commitment to transparent reporting, data-driven sustainability strategies, and climate-aligned investments will continue shaping the investment landscape, ensuring that long-term value creation goes hand in hand with environmental responsibility.