ESG, or environmental, social, and governance concerns, occupy a growing amount of headspace in many industries, commercial real estate being one of them. Most CRE investors see the topic as crucial as a matter of risk management.

But there's another aspect of risk: the SEC plans to clamp down on overinflated ESG investment claims, according to the Financial Times. That could mean CRE investment funds, REITs, and the like will have to increase compliance vetting on their marketing and communications.

In a mid-March article about the new SEC climate disclosure rules, Hunton Andrews Kurth counsel Samuel Kardon noted that some companies "tend to focus on their achievements and aspirations without addressing matters they are less eager to highlight," known as greenwashing. He then went on, "even though an ESG report that is not filed with the SEC is subject to the same potential liability under the general anti-fraud provisions of the federal securities laws as any other public statement by a public company, the level of rigor applied to the preparation and review of ESG disclosures by companies, their auditors and investors is often substantially less stringent than that applied to disclosures in SEC filings."