AvalonBay Communities is a publicly listed company headquartered in the US. In 2021 its revenue was USD 2.29 billion. AvalonBay is a Maryland corporation and elected to be treated as a real estate investment trust (REIT). The company operates as a property manager of multifamily apartment communities in the US.
AvalonBay shares information about its products and certification schemes (e.g. ENERGY STAR) with 100% of its customer base. The main objective of this engagement programme is to reduce customer emissions by increasing the number of residents who choose for ‘greener electricity’ supply by 5-10% annually (in markets where this choice is available). The company achieves this by providing customers with renewable energy choices and an on-site solar generation pilot project for residents. This customer engagement programme aims to support the company in achieving its scope 3 emissions reduction target of 47% by 2030 compared to 2017. However, the company’s alignment with a 1.5°C pathway could not be assessed.
AvalonBay has set 2°C aligned SBTi-validated targets to reduce its scope 1 and 2 emissions by 53% and its scope 3 emissions by 47% by 2030 compared to 2017. AvalonBay’s scope 3 target could not be assessed for alignment with a 1.5°C pathway, as the base year (2017) in-use emissions intensity of the company’s buildings could not be calculated. This is because the company does not report the floor area, and the emissions intensity figure it provides covers multiple categories. The company should set regularly spaced intermediate targets with gaps of no more than five years between its current targets and long-term targets. This will help incentivise near-term actions towards its longer-term goals.
AvalonBay aims to achieve emissions reductions in its supply chain through its Responsible Procurement Principles policy. Although the policy indirectly covers greenhouse gas (GHG) emissions reductions, it does not explicitly quantify requirements for suppliers. Further, AvalonBay is encouraging supplier innovation to reduce climate impacts on products and services. However, it does not require suppliers to report their GHG emissions. AvalonBay can better manage and control its downstream emissions by introducing GHG emissions reduction or reporting requirements for new suppliers or when renewing contracts with existing suppliers.
AvalonBay is actively developing various low-carbon business models, ranging from the installation of solar generation projects to supporting battery storage dispatch optimisation and demand response and a smart building data programme. AvalonBay can improve its performance by providing details on the profitability, size, growth potential and deployment schedule of all these business models.
AvalonBay Communities receives a trend score of =. If the company were reassessed in the near future, its score would likely remain the same. AvalonBay has set SBTi-validated emissions reduction targets for 2030. However, its scope 1 and 2 emissions reduction target, which is aligned with a 2°C scenario, does not align with the company’s 1.5°C pathway. Further, its scope 3 emissions reduction target could not be assessed. The company’s low-carbon transition plan is financed through issuing green bonds. Additionally, it aims to expand its solar capacity, use battery storage technologies and engage in a demand response and smart building data programme.
AvalonBay has set an SBTi-validated target to reduce its scope 1 and 2 emissions intensity by 53% and to reduce its scope 3 emissions by 47% by 2030 compared to 2017. Both targets are aligned with a 2°C scenario. The company has not set any long-term or net-zero targets.
AvalonBay has publicly published a low-carbon transition plan, which contains details on the use of USD 700 million in green bonds by 2032.It has also undertaken scenario analysis to inform its transition plan.
AvalonBay aims to achieve a total of 8.6 megawatts (MW) of solar capacity by 2022 (5% of its total energy consumption). Furthermore, it has commissioned a battery storage system at a community and is engaged in a demand response (i.e. energy demand and supply balancing)and a smart building data programme covering 13% of its portfolio.
AvalonBay does not disclose sufficient data to analyse its past emissions intensity trend. Although AvalonBay is on track to meet its scope 1 and 2 emissions reduction target, progress towards reducing the in-use scope 3 emissions of its buildings could not be assessed due to a lack of data.
AvalonBay acknowledges climate change as an issue and has a transition plan supported by USD 700 million in green bonds. The company is also increasing its solar generation capacity to 13.4 MW and moving towards building electrification and reduced natural gas reliance, but it lacks a gas phase-out date.
No evidence was found of AvalonBay’s commitment to social dialogue or of the categories of stakeholders the company engages with on a just transition. Furthermore, no evidence was found to demonstrate the company’s ongoing social dialogue and meaningful engagement with affected stakeholders.
No evidence was found of the company undertaking just transition planning to mitigate the social impacts of the low-carbon transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and with stakeholders in its just transition planning.
No public commitment by AvalonBay was found stating its intention to create and support access to green and decent jobs as part of the low-carbon transition. Moreover, no evidence was found of the company’s action to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups. Additionally, no relevant disclosure was found of the company’s assessment of employment dislocation risks.
The company discloses the actions it takes to provide training opportunities for workers and affected stakeholders, such as technical, cybersecurity, environmental awareness and job-specific trainings. However, no relevant disclosure was found of the company embedding equality of opportunity for women and vulnerable groups in these actions. Furthermore, no evidence was found of the company having a process for identifying skills gaps for workers and affected stakeholders or a public commitment to help workers displaced by the transition to re- or up-skill.
No relevant disclosure was found to show if AvalonBay identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders.
No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.
AvalonBay commits to respecting human rights, but there is no evidence that it commits to respecting the ILO fundamental rights at workor that it expects its business relationships to respect these rights. No evidence was found of the company’s process to identify, assess and mitigate salient human rights risks in its own operations and in its supply chain. Moreover, no evidence was found of the company disclosing the stakeholders whose human rights have been affected by its activities. The company does, however, have a grievance mechanism available to workers and external stakeholders to raise human rights concerns.
Although AvalonBay commits to respecting worker health and safety, it does not expect the same commitment of its business relationships. Further, no evidence was found of the company having a time-bound target for paying all its workers a living wage. The company discloses that none of its employees are covered by collective bargaining agreements, and there is no evidence that it supports the practices of its business relationships in relation to freedom of association and collective bargaining. The company discloses some indicators of workforce diversity, including the age and gender of its workforce by employee category. However, no relevant disclosure was found of additional indicators of workforce diversity.
AvalonBay commits to prohibiting bribery and corruption. However, there is no evidence that it includes corresponding clauses in its business relationship contracts. Further, no company policies or commitments related to other key ethical business topics – personal data protection, tax, and lobbying and political engagement – were found in the public domain. This includes ensuring ethical business conduct throughout its operations and in its relationships with business partners.