Industry Comparison

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You are viewing information about the following Industries:

Home Builders
Home Builders industry entities build new homes and develop residential communities. Development efforts generally include land acquisition, site preparation, home construction and home sales. The majority of the industry focuses on the development and sale of single-family homes, which are typically part of entity-designed residential communities. A smaller segment develops town homes, condominiums, multi-family housing and mixed-use development. Many entities in the industry offer financing services to individual homebuyers. The industry is fragmented, since many developers of all sizes exist, which vary in entity structure and geographical focus. Listed entities tend to be significantly larger and more integrated than the numerous privately held home builders.
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Mortgage Finance
The Mortgage Finance industry provides an essential public good by enabling consumers to purchase homes and contributing to the overall home ownership rate. Entities in the industry lend capital to individual and commercial customers using property as collateral. The primary products are residential and commercial mortgages, while other services offered include mortgage servicing, title insurance, closing and settlement services, and valuation. In addition, mortgage finance entities own, manage and finance real estate-related investments such as mortgage pass-through certificates and collateralised mortgage obligations. Recent trends in the regulatory environment indicate a significant shift towards consumer protection, disclosure and accountability. Regulatory changes made in response to the global 2008 financial crisis demonstrate the potential for further alignment between the interests of society and those of long-term investors.
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Relevant Issues for both Industries (6 of 26)

Why are some issues greyed out?

The SASB Standards vary by industry based on the different sustainability-related risks and opportunities within an industry. The issues in grey were not identified during the standard-setting process as the most likely to be useful to investors, so they are not included in the Standard. Over time, as the ISSB continues to receive market feedback, some issues may be added or removed from the Standard. Each company determines which sustainability-related risks and opportunities are relevant to its business. The Standard is designed for the typical company in an industry, but individual companies may choose to report on different sustainability-related risks and opportunities based on their unique business model.

Environment
- GHG Emissions
- Air Quality
- Energy Management
- Water & Wastewater Management
- Waste & Hazardous Materials Management
- Ecological Impacts
  The category addresses management of the company’s impacts on ecosystems and biodiversity through activities including, but not limited to, land use for exploration, natural resource extraction, and cultivation, as well as project development, construction, and siting. The impacts include, but are not limited to, biodiversity loss, habitat destruction, and deforestation at all stages – planning, land acquisition, permitting, development, operations, and site remediation. The category does not cover impacts of climate change on ecosystems and biodiversity.
Social Capital
- Human Rights & Community Relations
- Customer Privacy
- Data Security
- Access & Affordability
- Product Quality & Safety
- Customer Welfare
- Selling Practices & Product Labeling
  The category addresses social issues that may arise from a failure to manage the transparency, accuracy, and comprehensibility of marketing statements, advertising, and labeling of products and services. It includes, but is not limited to, advertising standards and regulations, ethical and responsible marketing practices, misleading or deceptive labeling, as well as discriminatory or predatory selling and lending practices. This may include deceptive or aggressive selling practices in which incentive structures for employees could encourage the sale of products or services that are not in the best interest of customers or clients.
Human Capital
- Labour Practices
- Employee Health & Safety
  The category addresses a company’s ability to create and maintain a safe and healthy workplace environment that is free of injuries, fatalities, and illness (both chronic and acute). It is traditionally accomplished through implementing safety management plans, developing training requirements for employees and contractors, and conducting regular audits of their own practices as well as those of their subcontractors. The category further captures how companies ensure physical and mental health of workforce through technology, training, corporate culture, regulatory compliance, monitoring and testing, and personal protective equipment.
- Employee Engagement, Diversity & Inclusion
Business Model and Innovation
- Product Design & Lifecycle Management
  The category addresses incorporation of environmental, social, and governance (ESG) considerations in characteristics of products and services provided or sold by the company. It includes, but is not limited to, managing the lifecycle impacts of products and services, such as those related to packaging, distribution, use-phase resource intensity, and other environmental and social externalities that may occur during their use-phase or at the end of life. The category captures a company’s ability to address customer and societal demand for more sustainable products and services as well as to meet evolving environmental and social regulation. It does not address direct environmental or social impacts of the company’s operations nor does it address health and safety risks to consumers from product use, which are covered in other categories.
- Business Model Resilience
  The category addresses an industry’s capacity to manage risks and opportunities associated with incorporating social, environmental, and political transitions into long-term business model planning. This includes responsiveness to the transition to a low-carbon and climate-constrained economy, as well as growth and creation of new markets among unserved and underserved socio-economic populations. The category highlights industries in which evolving environmental and social realities may challenge companies to fundamentally adapt or may put their business models at risk.
- Supply Chain Management
- Materials Sourcing & Efficiency
- Physical Impacts of Climate Change
  The category addresses the company’s ability to manage risks and opportunities associated with direct exposure of its owned or controlled assets and operations to actual or potential physical impacts of climate change. It captures environmental and social issues that may arise from operational disruptions due to physical impacts of climate change. It further captures socio-economic issues resulting from companies failing to incorporate climate change consideration in products and services sold, such as insurance policies and mortgages. The category relates to the company’s ability to adapt to increased frequency and severity of extreme weather, shifting climate, sea level risk, and other expected physical impacts of climate change. Management may involve enhancing resiliency of physical assets and/or surrounding infrastructure as well as incorporation of climate change-related considerations into key business activities (e.g., mortgage and insurance underwriting, planning and development of real estate projects).
Leadership and Governance
- Business Ethics
- Competitive Behaviour
- Management of the Legal & Regulatory Environment
- Critical Incident Risk Management
- Systemic Risk Management

Disclosure Topics

What is the relationship between General Issue Category and Disclosure Topics?

The General Issue Category is an industry-agnostic version of the Disclosure Topics that appear in each SASB Standard. Disclosure topics represent the industry-specific impacts of General Issue Categories. The industry-specific Disclosure Topics ensure each SASB Standard is tailored to the industry, while the General Issue Categories enable comparability across industries. For example, Health & Nutrition is a disclosure topic in the Non-Alcoholic Beverages industry, representing an industry-specific measure of the general issue of Customer Welfare. The issue of Customer Welfare, however, manifests as the Counterfeit Drugs disclosure topic in the Biotechnology & Pharmaceuticals industry.

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- Ecological Impacts
  The category addresses management of the company’s impacts on ecosystems and biodiversity through activities including, but not limited to, land use for exploration, natural resource extraction, and cultivation, as well as project development, construction, and siting. The impacts include, but are not limited to, biodiversity loss, habitat destruction, and deforestation at all stages – planning, land acquisition, permitting, development, operations, and site remediation. The category does not cover impacts of climate change on ecosystems and biodiversity.
  - Land Use & Ecological Impacts
    Home builders face risks associated with the ecological impacts of development activities. Developments often take place on previously undeveloped land, and entities must manage the ecosystem disruption of construction activities as well as the regulations and permitting processes that accompany ‘greenfield’ land development. Regardless of the siting decisions entities make, industry development activities generally carry risks related to land and water contamination, mismanagement of waste, and excessive strain on water resources during the construction and use phases. Violation of environmental regulations can result in costly fines and delays that decrease financial returns while potentially harming brand value. Entities with repeated violations or a history of negative ecological impacts may find seeking permits and approvals from local communities for new developments difficult, thereby decreasing future revenue and market share. Entities that concentrate development efforts in water-stressed regions may witness challenges to permitting approvals and increased land or home value depreciation because of water shortage concerns. Environmental quality control procedures, ‘smart growth’ strategies (including a focus on redevelopment sites) and conservation strategies may help ensure compliance with environmental laws, and therefore mitigate financial risks, while improving future growth opportunities.
- Selling Practices & Product Labeling
  The category addresses social issues that may arise from a failure to manage the transparency, accuracy, and comprehensibility of marketing statements, advertising, and labeling of products and services. It includes, but is not limited to, advertising standards and regulations, ethical and responsible marketing practices, misleading or deceptive labeling, as well as discriminatory or predatory selling and lending practices. This may include deceptive or aggressive selling practices in which incentive structures for employees could encourage the sale of products or services that are not in the best interest of customers or clients.
  
  None
- Employee Health & Safety
  The category addresses a company’s ability to create and maintain a safe and healthy workplace environment that is free of injuries, fatalities, and illness (both chronic and acute). It is traditionally accomplished through implementing safety management plans, developing training requirements for employees and contractors, and conducting regular audits of their own practices as well as those of their subcontractors. The category further captures how companies ensure physical and mental health of workforce through technology, training, corporate culture, regulatory compliance, monitoring and testing, and personal protective equipment.
  - Workforce Health & Safety
    Home construction requires a significant amount of manual labour from entity employees and subcontractors. Site excavation and home construction activities are physically demanding, exposing workers to risks from falls and heavy machinery and resulting in relatively high injury and fatality rates. Worker injuries and fatalities have internal and external costs that may significantly affect operations and an entity’s social licence to operate. Effects include fines, penalties, workers’ compensation costs, regulatory compliance costs from more stringent oversight, higher insurance premiums, and project delays and downtime. To avoid such costs, entities should foster a culture of safety with proactive safety management plans, employee and contractor training, and regular audits.
- Product Design & Lifecycle Management
  The category addresses incorporation of environmental, social, and governance (ESG) considerations in characteristics of products and services provided or sold by the company. It includes, but is not limited to, managing the lifecycle impacts of products and services, such as those related to packaging, distribution, use-phase resource intensity, and other environmental and social externalities that may occur during their use-phase or at the end of life. The category captures a company’s ability to address customer and societal demand for more sustainable products and services as well as to meet evolving environmental and social regulation. It does not address direct environmental or social impacts of the company’s operations nor does it address health and safety risks to consumers from product use, which are covered in other categories.
  - Design for Resource Efficiency
    Residential buildings, when occupied, consume significant amounts of energy and water. Entities in the Home Builders industry can improve home resource efficiency through sustainable design practices and choice of materials. Energy-saving products and techniques such as designing homes for efficient heating and cooling may reduce energy dependence, whether it comes from the electric grid or onsite fuel combustion. Intended to improve home resource efficiency, these measures may decrease home ownership costs through lower utility bills. Water-saving features such as low-flow faucets alleviate stress in water-scarce communities, while likely also reducing homeowner costs. Homebuyer awareness of energy and water efficiency creates an opportunity for entities to increase target market demand, thereby increasing revenue or margins. Effectively applying resource efficiency design principles in a cost-effective manner may be a competitive advantage, especially when entities are successful in systematically educating customers on the long-term benefits of these homes.
  - Community Impacts of New Developments
    Community and urban planning provide home builders with the opportunity to thoughtfully design new residential developments in ways that benefits customers as well as the surrounding community. New home development can bring economic growth and workforce opportunities while moderating cost-of-living increases, and it can provide communities with safe and vibrant neighbourhoods. Entities may strive to improve communities’ environmental and social impacts by providing access to public transportation or not overburdening existing transportation or utilities infrastructure, providing access to green spaces, developing mixed-use spaces, and creating more walkable communities. These strategies may increase the overall demand for and selling prices of homes as well as reduce the risks related to permitting and community or stakeholder opposition related to current or future developments. When entities use development strategies that inadequately integrate their new communities into the pre-existing surrounding communities, they may risk insufficient sales prices, excessive costs related to infrastructure needs and assessments, permitting delays or reduced community support for future developments.
- Business Model Resilience
  The category addresses an industry’s capacity to manage risks and opportunities associated with incorporating social, environmental, and political transitions into long-term business model planning. This includes responsiveness to the transition to a low-carbon and climate-constrained economy, as well as growth and creation of new markets among unserved and underserved socio-economic populations. The category highlights industries in which evolving environmental and social realities may challenge companies to fundamentally adapt or may put their business models at risk.
  - Climate Change Adaptation
    The impacts of climate change, including extreme weather events and changing climate patterns, may affect the markets entities select to develop homes and residential communities. Entities with business models that incorporate ongoing assessments of climate change risks, and adapt to such risks, are likely to grow entity value more effectively over the long term, partially through reductions in risk. More specifically, strategies focused on home development activities in floodplains and coastal regions exposed to extreme weather events, such as flooding, have increased the need to adapt to climate change, especially considering long-term challenges like flood insurance rates, the financial stability of government-subsidised flood insurance programs, permitting approvals and financing stipulations. Rising climate risks may translate into reduced long-term demand, land value depreciation and concerns over understated long-term costs of home ownership. Additionally, entities that build developments in water-stressed regions risk losing land value and may have problems getting permitting approvals. The active assessment of climate change risks and a holistic view of long-term homebuyer demand may enable entities to successfully adapt to such risks.
- Physical Impacts of Climate Change
  The category addresses the company’s ability to manage risks and opportunities associated with direct exposure of its owned or controlled assets and operations to actual or potential physical impacts of climate change. It captures environmental and social issues that may arise from operational disruptions due to physical impacts of climate change. It further captures socio-economic issues resulting from companies failing to incorporate climate change consideration in products and services sold, such as insurance policies and mortgages. The category relates to the company’s ability to adapt to increased frequency and severity of extreme weather, shifting climate, sea level risk, and other expected physical impacts of climate change. Management may involve enhancing resiliency of physical assets and/or surrounding infrastructure as well as incorporation of climate change-related considerations into key business activities (e.g., mortgage and insurance underwriting, planning and development of real estate projects).
  
  None
Mortgage Finance Remove
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- Ecological Impacts
  The category addresses management of the company’s impacts on ecosystems and biodiversity through activities including, but not limited to, land use for exploration, natural resource extraction, and cultivation, as well as project development, construction, and siting. The impacts include, but are not limited to, biodiversity loss, habitat destruction, and deforestation at all stages – planning, land acquisition, permitting, development, operations, and site remediation. The category does not cover impacts of climate change on ecosystems and biodiversity.
  
  None
- Selling Practices & Product Labeling
  The category addresses social issues that may arise from a failure to manage the transparency, accuracy, and comprehensibility of marketing statements, advertising, and labeling of products and services. It includes, but is not limited to, advertising standards and regulations, ethical and responsible marketing practices, misleading or deceptive labeling, as well as discriminatory or predatory selling and lending practices. This may include deceptive or aggressive selling practices in which incentive structures for employees could encourage the sale of products or services that are not in the best interest of customers or clients.
  - Lending Practices
    The approach mortgage finance entities take when incentivising employees and how they communicate with customers is important for more than one reason. First, the incentive structures and compensation policies of loan originators may unintentionally encourage them to promote lending products and services unsuitable for their clients. Second, a lack of transparency provided to customers with respect to primary and add-on products may impair an entity’s reputation and invite regulatory scrutiny and costly litigation. Finally, as a consequence, the resulting client portfolios may contain a high concentration of risky products sold. Also, laws and regulations restricting predatory lending may prohibit mortgage originators from receiving compensation tied to loan value and may require additional disclosures be provided to borrowers. Entities that develop transparent information, give fair advice to customers and clearly disclose their lending practices may assist shareholders in determining which entities better protect shareholder value.
  - Discriminatory Lending
    The Mortgage Finance industry aggregates data to determine loan terms and conditions including important provisions such as loan size, interest rate, up-front points or other fees. However, the complex process may result in intentional or unintentional discriminatory lending practices by the mortgage originator. Discriminatory lending may result in fines or settlements for violations of regulations, increased reputational risk, and negative financial performance because of loan mispricing. Disclosing internal processes to ensure non-discriminatory lending, disclosing the amount of mortgage lending categorised by minority status along with relevant financial characteristics, and disclosing the amount of monetary losses resulting from legal proceedings associated with violations of applicable laws and regulations may help investors assess entity performance. Entities in the Mortgage Finance industry may reduce the risk of discriminatory lending, including unintended discriminatory lending, by implementing strong processes, enforcing internal controls, and proactively monitoring their loan portfolio, among other techniques.
- Employee Health & Safety
  The category addresses a company’s ability to create and maintain a safe and healthy workplace environment that is free of injuries, fatalities, and illness (both chronic and acute). It is traditionally accomplished through implementing safety management plans, developing training requirements for employees and contractors, and conducting regular audits of their own practices as well as those of their subcontractors. The category further captures how companies ensure physical and mental health of workforce through technology, training, corporate culture, regulatory compliance, monitoring and testing, and personal protective equipment.
  
  None
- Product Design & Lifecycle Management
  The category addresses incorporation of environmental, social, and governance (ESG) considerations in characteristics of products and services provided or sold by the company. It includes, but is not limited to, managing the lifecycle impacts of products and services, such as those related to packaging, distribution, use-phase resource intensity, and other environmental and social externalities that may occur during their use-phase or at the end of life. The category captures a company’s ability to address customer and societal demand for more sustainable products and services as well as to meet evolving environmental and social regulation. It does not address direct environmental or social impacts of the company’s operations nor does it address health and safety risks to consumers from product use, which are covered in other categories.
  
  None
- Business Model Resilience
  The category addresses an industry’s capacity to manage risks and opportunities associated with incorporating social, environmental, and political transitions into long-term business model planning. This includes responsiveness to the transition to a low-carbon and climate-constrained economy, as well as growth and creation of new markets among unserved and underserved socio-economic populations. The category highlights industries in which evolving environmental and social realities may challenge companies to fundamentally adapt or may put their business models at risk.
  
  None
- Physical Impacts of Climate Change
  The category addresses the company’s ability to manage risks and opportunities associated with direct exposure of its owned or controlled assets and operations to actual or potential physical impacts of climate change. It captures environmental and social issues that may arise from operational disruptions due to physical impacts of climate change. It further captures socio-economic issues resulting from companies failing to incorporate climate change consideration in products and services sold, such as insurance policies and mortgages. The category relates to the company’s ability to adapt to increased frequency and severity of extreme weather, shifting climate, sea level risk, and other expected physical impacts of climate change. Management may involve enhancing resiliency of physical assets and/or surrounding infrastructure as well as incorporation of climate change-related considerations into key business activities (e.g., mortgage and insurance underwriting, planning and development of real estate projects).
  - Environmental Risk to Mortgaged Properties
    An increase in the frequency of extreme weather events associated with climate change may have an adverse impact on the Mortgage Finance industry. Specifically, hurricanes, floods and other climate change-related events have the potential to result in missed payments and loan defaults, while also decreasing the value of underlying assets. Entities which incorporate climate-related risks into lending analysis may be better positioned to create value over the long-term.

General Issue Category

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Ecological Impacts

Land Use & Ecological Impacts
Home builders face risks associated with the ecological impacts of development activities. Developments often take place on previously undeveloped land, and entities must manage the ecosystem disruption of construction activities as well as the regulations and permitting processes that accompany ‘greenfield’ land development. Regardless of the siting decisions entities make, industry development activities generally carry risks related to land and water contamination, mismanagement of waste, and excessive strain on water resources during the construction and use phases. Violation of environmental regulations can result in costly fines and delays that decrease financial returns while potentially harming brand value. Entities with repeated violations or a history of negative ecological impacts may find seeking permits and approvals from local communities for new developments difficult, thereby decreasing future revenue and market share. Entities that concentrate development efforts in water-stressed regions may witness challenges to permitting approvals and increased land or home value depreciation because of water shortage concerns. Environmental quality control procedures, ‘smart growth’ strategies (including a focus on redevelopment sites) and conservation strategies may help ensure compliance with environmental laws, and therefore mitigate financial risks, while improving future growth opportunities.

Selling Practices & Product Labeling

Lending Practices
The approach mortgage finance entities take when incentivising employees and how they communicate with customers is important for more than one reason. First, the incentive structures and compensation policies of loan originators may unintentionally encourage them to promote lending products and services unsuitable for their clients. Second, a lack of transparency provided to customers with respect to primary and add-on products may impair an entity’s reputation and invite regulatory scrutiny and costly litigation. Finally, as a consequence, the resulting client portfolios may contain a high concentration of risky products sold. Also, laws and regulations restricting predatory lending may prohibit mortgage originators from receiving compensation tied to loan value and may require additional disclosures be provided to borrowers. Entities that develop transparent information, give fair advice to customers and clearly disclose their lending practices may assist shareholders in determining which entities better protect shareholder value.
Discriminatory Lending
The Mortgage Finance industry aggregates data to determine loan terms and conditions including important provisions such as loan size, interest rate, up-front points or other fees. However, the complex process may result in intentional or unintentional discriminatory lending practices by the mortgage originator. Discriminatory lending may result in fines or settlements for violations of regulations, increased reputational risk, and negative financial performance because of loan mispricing. Disclosing internal processes to ensure non-discriminatory lending, disclosing the amount of mortgage lending categorised by minority status along with relevant financial characteristics, and disclosing the amount of monetary losses resulting from legal proceedings associated with violations of applicable laws and regulations may help investors assess entity performance. Entities in the Mortgage Finance industry may reduce the risk of discriminatory lending, including unintended discriminatory lending, by implementing strong processes, enforcing internal controls, and proactively monitoring their loan portfolio, among other techniques.

Employee Health & Safety

Workforce Health & Safety
Home construction requires a significant amount of manual labour from entity employees and subcontractors. Site excavation and home construction activities are physically demanding, exposing workers to risks from falls and heavy machinery and resulting in relatively high injury and fatality rates. Worker injuries and fatalities have internal and external costs that may significantly affect operations and an entity’s social licence to operate. Effects include fines, penalties, workers’ compensation costs, regulatory compliance costs from more stringent oversight, higher insurance premiums, and project delays and downtime. To avoid such costs, entities should foster a culture of safety with proactive safety management plans, employee and contractor training, and regular audits.

Product Design & Lifecycle Management

Design for Resource Efficiency
Residential buildings, when occupied, consume significant amounts of energy and water. Entities in the Home Builders industry can improve home resource efficiency through sustainable design practices and choice of materials. Energy-saving products and techniques such as designing homes for efficient heating and cooling may reduce energy dependence, whether it comes from the electric grid or onsite fuel combustion. Intended to improve home resource efficiency, these measures may decrease home ownership costs through lower utility bills. Water-saving features such as low-flow faucets alleviate stress in water-scarce communities, while likely also reducing homeowner costs. Homebuyer awareness of energy and water efficiency creates an opportunity for entities to increase target market demand, thereby increasing revenue or margins. Effectively applying resource efficiency design principles in a cost-effective manner may be a competitive advantage, especially when entities are successful in systematically educating customers on the long-term benefits of these homes.
Community Impacts of New Developments
Community and urban planning provide home builders with the opportunity to thoughtfully design new residential developments in ways that benefits customers as well as the surrounding community. New home development can bring economic growth and workforce opportunities while moderating cost-of-living increases, and it can provide communities with safe and vibrant neighbourhoods. Entities may strive to improve communities’ environmental and social impacts by providing access to public transportation or not overburdening existing transportation or utilities infrastructure, providing access to green spaces, developing mixed-use spaces, and creating more walkable communities. These strategies may increase the overall demand for and selling prices of homes as well as reduce the risks related to permitting and community or stakeholder opposition related to current or future developments. When entities use development strategies that inadequately integrate their new communities into the pre-existing surrounding communities, they may risk insufficient sales prices, excessive costs related to infrastructure needs and assessments, permitting delays or reduced community support for future developments.

Business Model Resilience

Climate Change Adaptation
The impacts of climate change, including extreme weather events and changing climate patterns, may affect the markets entities select to develop homes and residential communities. Entities with business models that incorporate ongoing assessments of climate change risks, and adapt to such risks, are likely to grow entity value more effectively over the long term, partially through reductions in risk. More specifically, strategies focused on home development activities in floodplains and coastal regions exposed to extreme weather events, such as flooding, have increased the need to adapt to climate change, especially considering long-term challenges like flood insurance rates, the financial stability of government-subsidised flood insurance programs, permitting approvals and financing stipulations. Rising climate risks may translate into reduced long-term demand, land value depreciation and concerns over understated long-term costs of home ownership. Additionally, entities that build developments in water-stressed regions risk losing land value and may have problems getting permitting approvals. The active assessment of climate change risks and a holistic view of long-term homebuyer demand may enable entities to successfully adapt to such risks.

Physical Impacts of Climate Change

Environmental Risk to Mortgaged Properties
An increase in the frequency of extreme weather events associated with climate change may have an adverse impact on the Mortgage Finance industry. Specifically, hurricanes, floods and other climate change-related events have the potential to result in missed payments and loan defaults, while also decreasing the value of underlying assets. Entities which incorporate climate-related risks into lending analysis may be better positioned to create value over the long-term.

Relevant Issues for both Industries (6 of 26)

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