Driving Sustainability in Strata Management and Strata Insurance

Sustainability is no longer just a buzzword—it’s a business imperative. For strata managers, embracing sustainability builds resilience, reduces costs, and ensures compliance with evolving regulations. With new mandatory reporting requirements in place for certain size businesses, understanding sustainability has never been more crucial.

What Is ESG and Why Does It Matter?

Environmental, Social, and Governance (ESG) is a framework that assesses a company’s impact on society and the environment. Many businesses still equate sustainability with simple measures like recycling, but ESG is broader. It influences risk management, ethical decision-making, and long-term business success.

For strata managers, adopting ESG can lead to:

• Higher employee engagement and client trust.
• A stronger market position.
• Compliance with new sustainability regulations.

Mandatory Sustainability Reporting

In July 2024, Australia introduced legislation for mandatory sustainability reporting, effective from January 2025. The timeline and reporting requirements differ depending on the size of the business. To find more detail, ASIC has outlined the sustainability reporting requirements for Australian businesses.

ESG Shaping the Future of Strata and Insurance

The insurance and strata industries are rapidly evolving to incorporate ESG principles. From underwriting to predictive analytics, these changes are setting the stage for a more resilient and sustainable future. Examples include:

1. ICA and Government initiatives 

• ICA has published a roadmap with specific targets for insurance businesses to drive sustainability forward.
• Discounts for cyclone-resistant buildings in Far North Queensland signal a shift toward incentivising sustainability. See recent APRC changes here.

2. Proactive Maintenance and Mitigation

• Insurers are working with clients to prevent and mitigate losses where possible, not just reacting to claims.
• Climate adaptation strategies will become increasingly important.
• CHU has introduced a range of risk mitigation fact sheets, with CHU Services providing expertise in the building maintenance, inspection and rectification space to consult with building owners and assist with inspection, remediation and reporting services.

Practical Steps for Strata Managers

Strata managers play a critical role in advancing sustainability. Implementing proactive strategies now will help future-proof properties and ensure compliance with evolving regulations. Some of these strategies could include:

1. Develop and implement ESG strategies and resilience plans to drive sustainability

• Conduct a materiality assessment using CHUs toolkit and uncover what is important to your business and customers.
• Review your own Scope 1 & 2 emissions and look at where you can reduce and offset emissions within your own business.

2. Engage in Sustainable Procurement within your supply chain

• Seek out and implement new suppliers with sustainability credentials.
• Reduce emissions by conducting virtual inspections

3. Continue to learn more about Sustainability, and ESG requirements for your business and industry

• Watch the recording of CHU’s  February webinar on how strata businesses can be proactive in working towards a greener and more resilient strata community.
• Reach out to us if you would like more information about how you can implement sustainability into your business.