ESG commentary in a Red Book valuation report should be factual, proportionate, and traceable — stating the evidence, the assumptions, and the limitations explicitly, without making performance claims or value judgements beyond what the data supports. The valuer's role is to document ESG risk factors that may affect market value, not to assess the property's sustainability credentials.
The distinction matters for professional liability. ESG commentary that overstates the risk exposes the valuer to challenge from the property owner. Commentary that understates it exposes the valuer to challenge from the lender or buyer. The safe ground is factual documentation with clear limitations.
The Structure That Works
Open with the regulatory context. State that the valuation considers ESG risk factors as required by the RICS Valuation – Global Standards (4th Edition), effective 30 April 2026. This frames the ESG section as a compliance requirement, not a voluntary addition, and establishes the standard against which the commentary should be assessed.
State the EPC position factually. "The property holds an EPC rating of [X], assessed on [date], valid until [date]. Under current enacted MEES requirements (EPC E minimum since April 2023), the property is compliant. Under the projected (but not yet enacted) EPC C threshold expected by 2028, the property would require upgrading to maintain lettability." Note the enacted vs projected distinction every time — this is your liability protection.
Report the CRREM misalignment year. "Based on CRREM 1.5°C pathway analysis for [property type] in [country], the property's current energy and carbon intensity exceeds/is within the pathway budget. The estimated misalignment year is [year], indicating the property is/is not currently aligned with science-based decarbonisation targets." State the data source and methodology clearly.
Provide proportionate capex context. "Industry benchmarks suggest retrofit costs from EPC [current] to EPC [target] in the range of £[X]–£[Y] per square foot. This estimate is indicative, based on published industry benchmarks, and does not constitute a formal cost plan. A detailed cost assessment would require a formal instruction to a building surveyor or quantity surveyor." This language satisfies the RICS Section 3 provision for technology-based cost information while explicitly stating the limitation.
Close with impact on value. "In the valuer's opinion, the above factors [have/have not] been reflected in the adopted [yield/market rent/both]. Market evidence suggests that properties with similar ESG risk profiles are trading at [describe market evidence if available]." This is where professional judgement applies — you are not valuing the ESG risk in isolation, but considering it as one factor affecting market value.
What NOT to write: Avoid subjective assessments ("this building has poor sustainability credentials"), unqualified claims ("the property will lose 30% of its value"), or recommendations ("the landlord should invest in retrofit"). These exceed the valuer's remit and create liability. Stick to documented evidence, stated assumptions, and disclosed limitations.
Plinthos for Valuers generates pre-drafted ESG commentary with this structure built in — factual, traceable, with limitation clauses ready for insertion into the valuer's Terms of Engagement. Every estimate is sourced and every assumption is stated, so the commentary is defensible from the moment it enters the report.