Global Built Environment Faces Sustainability Slowdown, Warns RICS

The latest 2025 Sustainability Report from the Royal Institution of Chartered Surveyors highlights a growing concern across the global built-environment sector: sustainability momentum is slowing. Drawing on survey responses from more than 3,500 industry professionals representing 36 countries, the report outlines weakening demand for sustainable buildings, slow adoption of carbon measurement practices, and persistent skills shortages that could hinder progress toward net-zero targets.

Global Demand Growth is Softening

Demand for sustainable real-estate assets remains positive overall, but the pace of growth has slowed across several regions. The Americas recorded the most pronounced decline, with respondents reporting noticeably softer interest from clients and investors. Europe, the UK and the Asia-Pacific region also showed reduced momentum. By contrast, professionals in the Middle East and Africa observed stronger growth in sustainability-related demand, making it one of the few regions to report improved sentiment.

Investor interest in certified green buildings remains, but the report notes several barriers limiting wider uptake. These include high upfront costs, uncertainty around long-term financial returns, weak investor awareness of climate-risk factors and inconsistent regulatory signals. Taken together, these hurdles are contributing to a slowdown in new sustainable-building commitments in several countries.

Carbon Measurement Gap Remains Wide

One of the most significant findings in the report is the limited use of embodied-carbon measurement in construction projects. Nearly half of the surveyed professionals, 46%, said they do not measure embodied carbon at all. This figure has increased compared with previous years, suggesting that progress in carbon accounting is not keeping pace with growing awareness of whole-life environmental impacts.

Only 16% of respondents reported that embodied-carbon data meaningfully influences material-choice decisions in project design. This limited adoption presents a challenge for achieving national and global decarbonisation goals. Embodied carbon, which includes emissions from the extraction, processing and transport of construction materials, accounts for a significant portion of total building-related emissions. Without broader uptake of whole-life carbon assessments, the sector risks falling short of climate-target trajectories.

Skills, Knowledge and Capacity Shortcomings

The report identifies ongoing gaps in sustainability-related skills across the built-environment workforce. Most respondents felt they have a general awareness of sustainable construction practices, but familiarity with circular-economy principles and whole-life-carbon methodologies remains low, especially outside mature markets.

RICS stresses the need for broad-based capacity building and investment in upskilling programs, particularly in emerging markets where training opportunities and technical resources are limited. The report encourages policymakers to support these efforts by fostering accessible professional-development pathways and integrating sustainability competencies into industry standards.

Policy and Regulatory Levers

To accelerate progress, the report outlines several policy recommendations. These include:

• Implement mandatory whole-life carbon reporting for all construction projects
• Establish national emissions limits aligned with international net-zero pathways
• Expand public incentives and private-sector financing for green retrofits and the use of low-carbon materials
• Harmonise global definitions and standards for low-carbon, resilient buildings
• Increase investment in sustainability-related training and skill development
• Strengthen biodiversity-related regulations and reporting frameworks

According to Nicholas Maclean, acting President of RICS, the findings highlight both progress and challenges: the built-environment sector recognises the need for transformation, but signs of fatigue and uncertainty are becoming more visible. He emphasised that robust policy and industry collaboration are needed to regain momentum.

Implications for Industry Stakeholders

For developers, investors and contractors, the findings have practical implications. Slowing market demand for sustainable assets may signal growing hesitation about green-building investments, especially in regions with weaker policy frameworks or financial incentives. Projects that do not incorporate robust carbon-measurement processes may face future regulatory risks, higher retrofit costs or the potential for asset devaluation as markets increasingly favour climate-aligned development.

The report also underscores the limitations of relying solely on voluntary action. Regulatory clarity, standardised measurement frameworks and consistent national policies are becoming essential for advancing decarbonisation across real-estate and construction markets.

For sustainability specialists and engineers, the data reinforces the urgency of strengthening skills in areas such as circular-economy design, embodied-carbon accounting, retrofit solutions and climate-resilient construction methods. These competencies are increasingly central to meeting both regulatory expectations and investor requirements.

For financial institutions, the report provides insight into future risk dynamics. Buildings that lack strong environmental performance metrics may become exposed to transition risk as carbon regulations tighten or investors place higher value on scientifically verified sustainability data. Conversely, markets showing continued momentum, such as parts of the Middle East and Africa, may offer new opportunities for climate-aligned investment and development.

Outlook for Net-Zero Goals

The built environment contributes a significant share of global greenhouse-gas emissions, driven by energy consumption during building operation and the carbon footprint of materials used in construction. Achieving net-zero commitments requires coordinated action to reduce emissions across all stages of a building’s life cycle. The RICS report suggests that current industry practices have not yet reached the scale and speed necessary to align with these goals.

Accelerating progress will require stronger regulatory frameworks, clear industry standards, broader adoption of carbon-measurement tools, more investment in training and higher levels of collaboration between government, finance and industry. Without decisive action, the sector risks falling behind on international climate commitments and undermining broader global decarbonisation efforts.

Overall, the RICS 2025 Sustainability Report serves as a warning that the built-environment sector stands at a critical juncture. While awareness and ambition remain, the slowdown in demand, low uptake of carbon measurement and persistent skills gaps indicate that the sector must act quickly to regain momentum and meet the challenges of the net-zero transition.

Source: www.rics.org