AEW becomes first asset manager to confirm Day One adoption of FCA’s new ‘Sustainability Impact’ label under Sustainability Disclosure Requirements regime

AEW, one of the world’s leading real estate investment and asset managers[1], announces that it will be among the first asset managers to adopt the new ‘Sustainability Impact’ label, under the Financial Conduct Authority’s (“FCA”) voluntary Sustainability Disclosure Requirements (“SDR”) regime, for its UK Impact strategy starting 31 July 2024, the earliest date that such labels are available for use.

The FCA introduced four new labels for strategies with sustainable characteristics under the SDR regime in 2023: Sustainability Focus, Sustainability Improvers, Sustainability Impact and Sustainability Mixed Goals. Working closely with Eversheds Sutherland, AEW’s UK Impact Strategy has cleared the FCA authorisation process for the adoption of new disclosures and will adopt the ‘Sustainability Impact’ label on the first day that it is available.

Under the ‘Sustainability Impact’ label requirements, AEW’s UK Impact strategy is committed to achieving sustainability and impact objectives. The strategy has adopted a bespoke Impact Management & Measurement (IMM) system, created in conjunction with The Good Economy, which is designed to align with the best principles of impact investing, requirements of the Global Impact Investing Network (GIIN) and the UN Sustainable Development Goals. KPIs that measure the progress of the impact objectives will be reported to investors in a bespoke independent annual impact report.

The impact assets include specialist supported living, key worker accommodation and care homes, together with community and residential-led town centre regeneration projects that influence wellbeing.

The strategy provides a solution for investors wishing to make a positive impact by addressing the place-based needs of the UK, increasing the provision of sustainable real estate with a social use value. This includes residential housing, care facilities, nurseries and leisure and community facilities. The strategy has an active management, core-style strategy and seeks to generate a sustainable income stream and return for investors.

Edward Long, Portfolio Manager at AEW, commented: “Our UK Impact Strategy is committed to creating a positive impact for people, place and planet, while helping clients achieve their return objectives. With the support of the investors, we have worked closely over the past two years with The Good Economy, Eversheds Sutherland and the FCA to align the strategy with the SDR regime, ensuring that the place-based impact investing strategy we have adopted meets the new stringent criteria. Our thanks to all our partners for their commitment to this project which allowed AEW to be among the first to adopt the new ‘Sustainability Impact’ label.”