Quantifying the Business Benefits of SustainableBuildings –Summary of existing research findings (Extracts) DRAFT for discussion Alan YatesCentre for Sustainable Construction, BRE16 February 2001Quantifying the business benefits of sustainable buildingsProject report number 203995 © Building Research Establishment Ltd 2001Executive SummaryThis report has been prepared as the first stage in a project to define the businessbenefits arising from sustainable construction techniques through case studies. Thiswork is part-funded by the DETR under their Partners in Innovation programme. Theproject team members comprise: BRE’s Centre for Sustainable Construction, BIFM,BCO, RIBA, Argent, BG Properties, Friends Ivory & Sime, North British HousingAssociation and the Northern Ireland Housing Executive (NIHE).This project aims to motivate building occupiers, managers and others involved inmaking decisions on the maintenance and procurement of buildings to adopt current bestpractice in their decision making through an improved understanding of the benefits thatcan be achieved. There is a perception amongst these groups that more sustainablesolutions in maintenance and procurement inevitably result in increased capital costsand /or reduced market / staff appeal. The project will explore the benefits achieved bystudying case studies across a range of sectors and issues. It will seek to map out thebenefits and begin to quantify them where this can be achieved.Much work has been carried out on the options for more sustainable buildings and anumber of guidance and incentive mechanisms exist to encourage the take up of moresustainable solutions. These include the DETR’s Energy Efficiency Best PracticeProgramme, Construction Best Practice Programme, Movement for Innovation (M4I),Design Advice Scheme (DAS), The BRE Environmental Assessment Method (BREEAM)and the BSRIA Code of Practice to name but a few. This has provided a wealth ofinformation on how to achieve more sustainable buildings but little that allows keydecision makers to assess the business case for adopting such solutions instead of welltried and tested ones. Feedback from such schemes always comes back to the sameissue. The industry is ready and able to make changes but only when the case isproved.This report is the first output of a BRE lead project to assess and attempt to quantify thiscase by looking at a number of case studies covering a range of sectors. The project isfunded under the Partners in Innovation programme and involves a number of influentialand strategic industry partners. The report summarises the current state of thinking overbusiness benefits arising from such buildings and seeks to map these out. No attempthas been ad at this stage to quantify them except in very general terms.The report concludes that benefits are diverse and potentially very significant. Many arehard and relatively easily quantifiable such as energy costs, construction costs etc.However, the ‘softer’ benefits relating to risk, image, profitability are currentlyunquantifiable. They are the more significant though and should be the focus of futurework under this project.Quantifying the business benefits of sustainable buildingsProject report number 203995 © Building Research Establishment Ltd 2001Contents1.0 Outline of the Project 32.0 Context for Sustainable Buildings 52.1 Background to Sustainable Development 52.2 Sustainable Business 53.0 Decision makers concerns 83.1 Stakeholders Costs 84.0 Industry Perceptions 114.1 Perceived Investment Risks 114.2 Perceived Capital Costs 114.2.1 Value Management in a prestige office 124.2.2 The cost efficiency barrier 125.0 Benefits to Businesses 145.1 Introduction 145.2 Economic benefits 155.2.1 Financial 155.2.2 Risk 165.2.3 Management / auditability – 175.3 Environmental Benefits 185.3.1 Controlling Climate Change 195.3.3 Reduced ozone depletion 195.3.4 Reduced resource depletion 205.3.5 Pollution 205.3.6 Biodiversity 205.4 Social benefits 205.4.1 Health & Well-being 205.4.2 Image 215.4.3 Community - These issues affect the external image of a business. 215.4.4 Respect for People - These issues effect the external image of a business 226.0 Quantification 23Quantifying the business benefits of sustainable buildingsProject report number 203995 © Building Research Establishment Ltd 20011.0 Outline of the ProjectAimThis project aims to motivate building occupiers, managers and others involved inmaking decisions on the maintenance and procurement of buildings to adopt current bestpractice in their decision making through an improved understanding of the benefits thatcan be achieved. There is a perception amongst these groups that more sustainablesolutions in maintenance and procurement inevitably result in increased capital costsand /or reduced market / staff appeal. Whilst this does not appear to be supported bythe growing evidence it presents a major barrier to greater sustainability in our buildingstock. There are, however, many organisations who are beginning to recognise real andquantifiable benefits including the following:• capital cost savings• reduced running costs• increased investment returns• increased productivity, staff recruitment and retention• more efficient resource use• major image / marketing spin-offsThose tasked with developing proposals for procurement and maintenance ofcommercial accommodation are faced with justifying them to sceptical investors and highlevel management who tend to be and focused on short term capital costs. Whilst thereis much guidance available on solutions and actions of which awareness is moderatelygood, there is little in the way of quantifiable data on benefits, life cycle impacts withwhich to build a case for their adoption. This project seeks to collect together existingdata and reinforce this through studying a series of case studies to raise understandingand confidence. These will be used to provide a simple method for predicting benefitsarising from the range of practicable options available to premises managers. The study will seek to include a range of building types ranging from offices andindustrial buildings to retail and leisure. These represent the significant proportion of thecommercial building stock in the UK and therefore the largest potential for making realprogress towards reducing impacts. Project MethodologyOur approach is based on the need to work with those directly involved in decisionmaking both
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