RICS Draft Update to the Global Red Book

Red Book Global Update 2022 - Proposed Changes

Part 2: Glossary 

basis of value - A statement of the fundamental measurement assumptions of a valuationIn some jurisdictions, the basis of value is also known as the 'standard of value'. 

environmental, social and governance (ESG) - The criteria that together establish the framework for assessing the impact of the sustainability and ethical practices of a company on its financial performance and operations. ESG comprises three pillars: environmental, social and governance, all of which collectively contribute to effective performance, with positive benefits for the wider markets, society and world as a whole.Although ESG principally refers to companies and investors, ESG-related factors are also used to describe the characteristics and, where relevant, operation of individual assets. It is used throughout these standards in this context.

sustainability- Sustainability is, for the purpose of these standards, taken to mean the consideration of matters such as (but not restricted to) environment and climate change, health and well-being, and personal and corporate responsibility that can or do impact on the valuation of an asset. In broad terms, it is a desire to carry out activities without depleting resources or having harmful impacts. 

There is as yet no universally recognised and globally adopted definition of 'sustainability'. Therefore, members should exercise caution over the use of the term without additional appropriate explanation. In some jurisdictions, the term 'resilience' is being adopted to replace the term 'sustainability' when related to property assets.

Sustainability may also be a factor in environmental, social and governance (ESG) considerations.