Webinar Recap: 5 Ways to Audit Data Quality in Sustainability Reporting
Last week, Urjanet’s Tim Porter, Measurabl CEO Matt Ellis, and Shorenstein sustainability program manager Jaxon Love joined forces to share data quality best practices. ESG reporting is only as good as the data that powers it, so auditing for data quality in sustainability reporting is not a nice-to-have; it’s a must-have. In a nutshell, here’s what the three experts had to say on the subject:
5 Steps to Audit Data Quality in Sustainability Reporting
1. Take humans out of the equation.
2. Have an auditing framework in place.
3. Utilize data analysis tools.
4. Gather data monthly rather than annually.
5. Make sure your data set is complete.
Shorenstein’s Case Study
When Shorenstein put these steps into practice, the company saw real results. Last year, Shorenstein conducted an internal audit of the data flowing into ENERGY STAR. They selected 20 buildings out of their entire portfolio and confirmed whether the utility account information and entry of monthly energy and water data was accurate. Out of hundreds of data points, they found only 19 discrepancies. Ultimately, they determined that those discrepancies had no material impact on the quality of their ENERGY STAR data, which gave them internal assurance.
Tim calls this type of practice “sampling.” Like a tomato sauce factory might spot check a few random cans on an assembly line to see whether each is labeled and sealed correctly, Shorenstein spot checked a few buildings to evaluate overall data quality. It’s best practice to conduct internal audits like these, so all the reporting that follows can be relied upon with confidence.
“Nobody in the market should be talking about perfection. What we can talk about is substantial, material improvements between the old and the new techniques.”
Now that Shorenstein had internal assurance, the team could move on to use ENERGY STAR Portfolio ManagerⓇ as a tool for competitive advancement. Using careful benchmarking in Portfolio Manager, the team improved its ENERGY STAR 1-100 score for “Building A” from 82 in 2008 to 97 in 2017. “Building B” underwent an even more dramatic change, from being at the bottom of the barrel with a score of 22 to being within spitting distance of ENERGY STAR certification.
According to Matt, Shorenstein’s example shows that the answer to the issue of data quality in sustainability reporting isn’t simply aiming for perfection. Shorenstein’s data ultimately still had some discrepancies, but the auditing and data collection techniques used were advanced enough to give the team room to move forward. “Nobody in the market should be talking about perfection. What we can talk about is substantial, material improvements between the old and the new techniques,” said Matt.
Are you getting whole building data for the totality of the building? If so, did you have to do things inside the building to get that full visibility?
Jaxon: In certain markets, utility companies have been willing to provide a method to collect whole building data. In other markets, it’s a little more nuanced. Both on the energy and particularly on the water side, where you may have tenants with their own water meters, it can be a real challenge to collect that whole building data.
In the case of Building A and Building B, we are looking at the whole building, and it is benchmarking best practice to include the whole building wherever possible. If you’re in a multifamily environment, it’s not really meaningful if you’re capturing base building usage but not usage of individual tenants. We could spend a whole other webinar talking about whole building data, but I’ll just say that it is important, and it is a challenge, and hopefully we’ll see better solutions come along in the market to address it.
Matt: GRESB has a statistic about data coverage. It looks at how much of your total floor area you’re including in reporting. For an office, you’ll typically see around 90 percent coverage rates. For industrial facilities, retail, or multifamily, on the other hand, you’ll expect to see very low coverage rates.
It’s an issue when it comes to data quality, because we’re only able to have visibility into portions of the asset, and that means we may not be able to take action. For all intents and purposes, the asset’s doing great, but we’re only seeing 10 to 20 percent of its performance. Jaxon has great visibility, but it isn’t easy and it isn’t free — it takes time and effort.
Do you think we’re at a place where investors are really making a change in their decisions based on sustainability results?
Jaxon: Sustainability has continued to become more and more important to executives and decision makers within real estate organizations. That’s been my perception since coming into this industry six years ago. I expect that we’re going to continue to see that trend.
You may also like:
- Webinar: Sustainability Programs — Surviving or Thriving?
- ESG Best Practices for Growing Sustainability Programs
- Interview: How Urjanet Ensures Data Quality
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About Amy Hou
Amy Hou is a Marketing Manager at Urjanet, overseeing content and communications. She enjoys writing about the latest industry updates in sustainability, energy efficiency, and data innovation.