Upstream has once again undertaken a formal audit to establish The Crown Estate’s level of achievement against each of its 2005-06 Corporate Responsibility (CR) targets. Upstream continues to provide strategic advice to The Crown Estate on CR strategy, and is therefore not fully independent.

The audit undertaken has consisted of the following:

• Attendance at quarterly meetings of both the CR Working Group and the CR Committee, which include updates from members on progress against annual CR targets.
• Attendance at regular meetings of the Responsible Procurement Sub-Group, which was tasked with taking a number of the 2005-06 targets forward.
• Meetings with CR coordinators, and interviews with individual members of the CR Working Group.
• Audit of documentation provided as evidence in support of progress for each target.

From the review findings, Upstream would make the following comments:

• A total of 26 CR targets were set for 2005-06, three quarters of which were fully achieved. This represents a very good performance and reflects the strong sense of ownership over the targets by key representatives from The Crown Estate.
• Only two of the targets (8%) remain not completed. This is relatively low in comparison with some of The Crown Estate’s peer group companies in the property industry.
• The Crown Estate performed best in relation to ‘The Way we do Business’ with 90% of the targets completed in this area, and the next best areas were ‘Our Customers’ and ‘The Environment around Us’ where over 70% of the targets were fully achieved.
• In relation to ‘Our People’, 40% of the targets were fully completed, once again reflecting the organisation’s focus on balancing business needs between conflicting priorities, and on postponing of several big HR initiatives.

Some of the particular achievements for The Crown Estate to be proud of during the past year include:

• Significant progress on responsible supply chain procedures including environmental guidance for managing agents and internal guidelines on issues such as timber and paper procurement.
• Shifting practices in customer relations culminating in the restructuring of a central customer focused team in-house, and more demanding standards of agents in this area.
• Considerable contributions to environmental research, particularly through initiatives undertaken by both the marine and rural estates.
• Continued achievement of high BREEAM ratings for new developments funded by The Crown Estate, and the application of strong principles of community engagement.

The following continue to represent challenges for The Crown Estate:

• Measurement, monitoring and targeting of environmental impacts across the actively managed urban portfolio. Significant advances have been made in this regard but, as with other landlords, this remains a difficult process for The Crown Estate and its agents.
• Finding ways of capturing the positive value of environmental and social good practice which is currently being undertaken across the various parts of the estate.
• Many of the sustainability impacts arising from properties owned by The Crown Estate are ultimately driven by tenants’ own practices, and helping and encouraging them to address these can be challenging.
• Standardising the way in which The Crown Estate invests in local community activities across the different estates.

We look forward to working with The Crown Estate to address these challenges in time, and to continue to find ways in which it can make the links between property investment returns and sustainability performance.

Julie Hirigoyen
Director