Environmental Social & Governance (ESG)

Proplend defines ESG to be any environmental, social or governance consideration that can have a positive or negative impact on either Proplend at a corporate level or the loan transactions facilitated across the Proplend platform.

Our aim is to operate the business in a way that is in harmony with the environment, promotes and treats our employees well, supports local communities and adheres to the highest standards of corporate governance.

 

Proplend is a technology platform for investor funded commercial property VAT, Bridge and Term Loans. Our market sector covers the sub £5m commercial properties which tend to hold the worst ESG and EPC credentials. Proplend therefore recognises our fiduciary duty to work towards a sustainable transition loan framework to demonstrate our commitment towards a low carbon economy.

Whilst new build properties (residential and commercial) are rigorously scrutinised for their Environmental credentials before they are built, the majority of existing commercial real estate was built before 1990 and is therefore likely to have poor quality lighting, insulation, heating and building management systems².

This thesis shows a potential saving of 50-70% of Embodied Carbon (the carbon emitted during construction) which can then be leveraged by working to reduce the ongoing Operation Carbon of these assets via retrofitting efficiency measures.

Proplend is keen to promote lending to enable the continued use of existing commercial real estate assets over the knocking down of old and building of new assets and offer reduced interest rates to Borrowers where the assets are of a higher EPC rating.

Therefore, through our role in the financial system, we have the power to help create a sustainable and prosperous world for all by enabling capital to be allocated to areas that deliver social, environmental and investment value.

Our purpose is to generate value for our Shareholders and service Lenders and Borrowers, whilst remaining cognisant of the impact that the Real Estate Industry contributes to the planet and work to reduce that impact.

Act ethically and transparently in all our operations and bring integrity and accountability to build trust and confidence in all those we deal with.

  • look after our Employees
  • strive to understand our Borrower’s and Lender’s needs to help turn visions into realities
  • abide by codes of conduct and be accountable for our actions
  • recognise our social responsibilities both environmentally and socially
  1. The 2020 Global Status report for Buildings and Construction
  2. European Commissions April 2019

Proplend considers the three pillars; environmental, social and governance, all of which contribute to effective performance, with positive benefits for the wider markets, society, and the world as a whole, in all aspects of our operations, both how we operate as a company in our own behaviours and approach and also what we expect from our Employees, Borrowers, Lenders, and Partners.

  • identify, review and address Proplend’s operational footprint and environmental performance towards achieving Carbon Neutrality in 2022
  • remain compliant across all relevant legislation
  • assess the environmental implications of Borrower Loan requests
  • offer properties with a higher EPC rating, reduced rates of interest
  • value our employees and assist them in realising their full potential
  • promote employee well-being across physical and mental health
  • empower our employees with a supportive learning culture through continuous employee training
  • foster a working environment where everyone can speak their mind and empower mutual trust and respect
  • Proplend is committed to being an equal opportunities employer and backs this up by aiming to identify candidates from a range of backgrounds in its recruitment process
  • enable and encourage employees to participate by providing their skills and experience to wider community purposes such as charitable work, community Police Officers or Court Magistrates
  • offer Charities and Borrowers whose properties or use of those properties provides a positive social role in the local community reduced Arrangement Fees.
  • ensure that the Board are fully engaged with, contribute towards and police the ESG Statement
  • maintain a transparent management structure with robust internal procedures and controls
  • abide by the regulations and compliance as set out by the Financial Conduct Authority (FCA) by whom we are authorised and HMRC by whom we are approved to operate an IFISA
  • Proplend actively operates a code of ethics and policies for each of treating customers fairly, vulnerable clients, anti-money laundering, conflicts of interests, disciplinary and grievance, complaints, whistleblowing, inducements, gifts and anti-bribery, anti-slavery and human trafficking, working from home, market conduct and personal account dealing
  • protect the digital information of the Proplend platform and our clients through robust Data Security
  • insist on the highest levels of personal and professional integrity, objectivity, professionalism, confidentiality, and honesty from all employees

Identify, review and address our operating carbon footprint to reflect our commitment to both reduce and offset Proplend’s direct carbon footprint.

We have via a partner, Skoot.eco, calculated our annual emissions in line with the Greenhouse Gas Protocol and are offsetting 100% of those emissions via the planting of trees with a certified reforestation charity, helping Proplend achieve net zero and become a cleaner, greener business.

In addition, we have removed plastic bottle waste within the office, added green plants to improve air quality and by refactoring our technology stack have reduced server load and therefore energy requirements.

Sustainable Lending looks at both Proplend’s (and our Lenders) profits and how we generate them. This involves a fundamental shift in how the properties which secure our loans are viewed and valued. Understanding the impact they have on society and the planet is crucial in determining their true costs and values. Negative factors are risks that can diminish lending returns and therefore need to be identified and considered as part of a responsible lending framework.

Proplend commits to engage with and educate commercial property investors (our Borrowers) on ESG factors and to support and guide them towards transitioning their assets reach EPC C by 2027 and EPC B by 2030.

We are currently exploring loan structuring frameworks which will provide Borrower’s standalone “defensive capex transitional” loans linked to measurable improvements in the EPC ratings of existing assets.

In addition, the framework will offer Term Loans to Borrowers, at more attractive rates of interest, where the underlying asset has already achieved a higher EPC rating.

The commercial property sector where Proplend is most actively lending, is a sector heavy with embedded carbon and where the assets are most in need of transition to reduce their Operational Carbon footprint.

We commit to developing an ESG Risk Assessment (covering both EPC and social impact) and responsible Lending policy within the credit decisioning process and include ESG commentary within our Full Loan Request document.

By highlighting this within our documentation, it will provide our Lenders a choice as to how they deploy / invest their funds in a manner which most matches their personal ESG policies / views.

Where appropriate we will engage with independent third parties to ensure governance over our ESG statement and Lending policies.