To fully utilize the sustainable potential of real estate, owners and tenants should agree on the distribution of costs and risks in a so-called green lease contract. This is the recommendation of the Dutch Platform Sustainable Housing (Platform Duurzame Huisvesting), which will further develop the ‘Guideline Green Lease’ by order of the Dutch government¹. The use of a green lease can solve the problem of ‘split incentive’ between the tenant and the building’s owner. When they agree on lease terms that share the benefits of lower utility bills, the landlord is more likely to invest in energy-efficient building upgrades.

Did the Financial Crisis have an impact on the preferred renewable energy investment policies of private equity investors? In their paper titled ‘Did the Financial Crisis lead to Changes in Private Equity Investor Preferences Regarding Renewable Energy and Climate Policies?’, researchers Daan Hofman and Ronald Huisman of the Erasmus School of Economics revisited a pre-Crisis study of the preferences of clean-tech venture capital and private equity investors regarding renewable energy and climate policies. Within four years — from the original team’s 2007 survey to Hofman and Huisman’s 2011 survey — they found that the popularity of trade based policies, such as emissions trading, significantly decreased. The only policy which popularity increased was governments setting technology performance standards.

In this video Simone Ruiz, European Policy Director at the International Emissions Trading Association (IETA) discusses the ‘set aside’ from the position of the IETA, which represents a wide variety of stakeholders with conflicting needs. ‘Our position is a bit mixed,’ she says. Long- term solutions are what the IETA seeks, but ‘if you cannot wait, then remove a certain amount of allowances, but only do so in an objective, transparent, and predictable manner, and let us know what will happen with these allowances at the end of the day,’ she says.

Matthew Kiernan is Founder and Chief Executive of Inflection Point Capital Management, Founder of Innovest Strategic Value Advisors, and a an expert in sustainable investment. In this video interview, Dr. Kiernan discusses the importance of integrating issues of sustainability in investment — and why this investment space continues to face slow growth. “One of the misconceptions in this space has been that there is not a performance benefit to be had from integrating sustainability and financial performance,” he says. “Most investment professionals don’t believe in their guts that there are performance benefits to be had.”

In this video interview Luther Ragin, Jr., CEO of the Global Impact Investing Network (GIIN) discusses how the non-profit organization is working to improve this crucial, but still nascent, area of finance. In this new area of practice, “market mechanisms have not fully evolved and developed and there is considerable fragmentation and opacity,” he says. To overcome these challenges GIIN’s investor council is sharing knowledge and experience and building a platform of expertise. “We feel there is an important role to play in encouraging better information flow, better research, better organization and mobilization of investors in this area, and the opportunity for impact investors to collaborate to create an effective language around impact investment strategies.”