A big part of John’s role involves challenging the business to be as ambitious as possible in its sustainability commitments. What does sustainability mean to him?
“For me, it’s about enabling people and planet to thrive together,” he says. A sustainable place might look different in different parts of the world, depending on the geographical context, but ultimately “society and our economic system are dependent on the environment – we have to view them holistically, not separately”.
John’s vision for delivering sustainability at Legal & General Captial (LGC) involves “creating positive social and environmental impact across all of our investments – and being able to evaluate and demonstrate that impact in a really transparent and robust way”. Investing in areas that help to better society is “in the company’s DNA”, he says, but achieving sustainability comprehensively and across the board is still not easy.
“A few years ago, the sustainable business expert John Elkington coined the concept of a ‘triple bottom line’ – people, planet, profit,” says John. “More recently, however, he ‘recalled’ the phrase, concerned that it had been misused by businesses to justify trade-offs between the three pillars of sustainability.”
This is an approach John is keen to avoid at LGC. “Of course some investments are going to be more focused on certain outcomes, like tackling climate change or delivering affordable homes, but I don’t think an approach where the sustainability of some investments justifies others that are not sustainable but are financially successful is the right one. Sustainability needs to be like the writing in a stick of rock: running right the way through everything we do. It has to be co-owned by all our teams.”
Measuring social value and social impact is important, says John, “but before you can measure it, you need to deliver it in the first place”. When delivering social value through housing and real estate investments, for him, the key is sensitivity to the local context. “We’re guided by the specific needs of people and the uniqueness of a given place. Our goals are best achieved through close collaboration with the local community, as well as other stakeholders, such as local government.”
Delivering place-based social value is closely interlinked with LGC’s wider sustainability goals, says John. “There’s an amazing number of win-wins we can get from addressing environmental and social needs together. The mental health benefits of integrating nature and biodiversity into development is one that always strikes me.”
For me, it’s about enabling people and planet to thrive together.
One way LGC is delivering sustainability is its commitment to make all its new housing net zero-enabled by 2030. Coming from his previous role as director of policy and places at UK Green Building Council, it is an area John is well versed in.
“Our commitment is to delivering new homes from 2030 that are enabled to be net zero carbon in operation,” he explains. “That means new homes that are highly efficient, with no gas boilers of course, and maximum on-site renewable energy generation. The last piece of the puzzle is the extra electricity needed for appliances, but this can be made net zero too with a high-quality ‘green tariff’. Even if the householder decides to switch tariff, the National Grid is decarbonising at such a rapid rate that any emissions would be time-limited.”
Embodied carbon is also rising up the agenda. “There are different definitions,” says John, “but generally, embodied carbon refers to carbon emissions associated with the construction process, and contained within the construction materials themselves.” LGC’s housing businesses have been “doing some really detailed work to understand their embodied carbon footprints, and are taking steps to reduce those,” he says. One example is CALA Homes – LGC’s largest housebuilder – which is working to expand the use of timber frames in its housing after success in Scotland.
Retrofitting existing housing stock to make it more energy efficient is another focus area in the drive to net zero. “For a business like L&G Affordable Homes, there’s a real opportunity to bring poorly performing homes into the portfolio, then radically refurbish them to make them much lower-carbon, higher-quality properties,” says John, “but this is something the sector has been grappling with for years. It’s not impossible, but it is challenging and needs to be done with a very high degree of skill. There’s also a significant upfront cost to get those carbon reductions in place… although the energy crisis certainly supports the business case.”
Delivering sustainability is not without its challenges, but having just passed his six month mark at LGC, John is optimistic about what is possible. “We have an almost unparalleled ability to make direct investments in such a wide range of sectors and assets, which allows us to make a real difference to people, communities and the environment,” he says.
LGC is working on a development of 185 new homes at Lockleaze, north of Bristol city centre through its Modular Homes business. The site is subject to several constraints, including its SINC (site of importance for nature conservation) status and its significant protected slow worm population.
In line with our ‘excellent’-rated Building With Nature certification, we have translocated 298 slow worms, as well as developing and funding a 30-year ecological management plan. The modular homes at the site are all EPC A rated, featuring air source heat pumps and solar panels.