Roxane McMeeken examines the problems facing multinational clients trying to employ the same tough sustainability standards from Brazil to Bangalore
鈥楽ustainability is no longer an option. Sustainability is an imperative.鈥 So says IBM on the 鈥淓nergy and Environment鈥 page of its website. Coca Cola鈥檚 2010/11 Sustainability Report, meanwhile, says the company plans 鈥渃leaner energy, greater efficiency, and 鈥 to grow our business but not our emissions.鈥
These sorts of statements are emblazoned on the marketing material of almost all large global companies. With buildings consuming 42% of all electricity worldwide and set to be the biggest emitters of CO2 by 2025, according to IBM, the way that multinationals manage their property portfolios is a critical element in determining the effectiveness of their sustainability strategies.
While these global clients of the construction industry state excellent intentions, they face a huge challenge when trying to apply a consistently sustainable approach in the widely varying countries in which they operate. So how do clients and their consultants go about tackling this conundrum?
Global challenges
Grosvenor, which has offices and property investments in the UK, Americas and Asia Pacific, illustrates the typical issues of the global client. Giles Clarke, director and executive sponsor for environmental sustainability in the developer鈥檚 Britain & Ireland business, says: 鈥淲e are faced with the challenge of different legal regimes, procurement issues, sustainability standards and consumer views, all of which impact targets set and the ability to meet them.鈥
Achieving a uniform approach to sustainable procurement is difficult therefore, as Marks & Spencer is finding as it rolls out its Plan A sustainability strategy globally, with 鈥渟ustainable learning鈥 stores having opened in Bangalore in November 2011 and in Delhi in March 2012.
Sylvie Sasaki, Plan A project manager, highlights skills as a particularly troublesome area: 鈥淭he biggest challenge we face is finding local firms with the calibre of sustainability experience and know-how we require. In some instances, we鈥檝e had to look to our existing UK supplier base to achieve our construction programme goals or train up local suppliers.鈥
For global warehouse developer Gazeley, the local availability of both skills and materials affect its sustainability policy. Jonathan Fenton-Jones, global procurement and sustainability director, says: 鈥淚n the UK the default is steel frame so we use a high percentage of recycled steel, but in Italy the prevalent approach is concrete - the steel skills aren鈥檛 there and concrete construction technology is much more advanced, so we make sure we鈥檙e using mixes with sustainable aggregates.鈥
Operating in a range of climates is another hurdle to one-size-fits-all strategies. Fenton-Jones says: 鈥淲ith our warehouses, in the Middle East we need to prevent heat gain while in northern Europe the issue is keeping the buildings warm in winter.鈥
Neither do sustainability certifications work in all locations. Nokia, for example, aims to use socially responsible timber such as wood certified by the Forest Stewardship Council (FSC) in its policy on the sustainable sourcing of materials, but ran into problems implementing this in India. Sean Lockie, director of carbon and sustainability at Faithful + Gould, which provided sustainability services as well other services to a Nokia global retail store roll-out programme, says: 鈥淲e eventually found a wood standard in India but we had questions about how sustainable the supply chain was, which meant that we found only 40-50% of timber products could be guaranteed to be of the required standard.鈥
We are faced with the challenge of different legal regimes, procurement issues, sustainability standards and consumer views
Giles Clarke, Grosvenor
Lockie says that importing FSC wood from Europe was considered but ruled out on the grounds that transporting it and not engaging with the local economy were in themselves unsustainable approaches. Instead, Nokia is using the local standard, which delivers around half the sustainablity targets Nokia wants, but the aim is to lift this to 100% in India within three years.
The big-name sustainability certification systems can also travel poorly. For example, LEED, having been developed in the US, may not serve clients well in other regions. Celeste Morgan, director of architecture and planning at Aecom, says: 鈥淚f you build a gated development you fail to get LEED credits because that is deemed to be detrimental to the sense of community in the States, but in Brazil, where privacy is a huge issue, gated communities are very desirable.鈥
Another hurdle is that the person in charge of sustainability may not have the ability to fully implement top-level strategy on the ground. Erland Rendall, director of Artorus Consult, who has extensive experience of working with global clients, says: 鈥淵ou need very disciplined systems and a consistent corporate culture in order to achieve a uniform roll-out. I have seen some companies where the domestic real estate team in New York was setting the global property strategy but it just wasn鈥檛 being applied properly in places like Nairobi.鈥
Furthermore, the sustainability boss may not have control of the budget. Joe Potter, associate partner at IBM, says: 鈥淲e find that our clients have someone very senior responsible - usually at board level - for sustainability but invariably they don鈥檛 control the budget for maintenance, construction and energy, which can slow take-up of sustainable approaches.鈥
The search for solutions
Encouragingly, a large amount of work is being done by global clients and their construction consultants to manage their property portfolios sustainably.
One positive step is the development of new sustainability standards. The Green 黑洞社区 Council Brazil, for example, is developing a version of the LEED certification adapted to the Brazilian market and Aecom is working on developing LEED for resorts worldwide.
Hanif Kara, co-founder of structural and civil engineering firm AKT II, warns that even more must be done: 鈥淟EED, BREEAM are valid and legitimate tools but the size of the developments we are seeing in India and China now requires new standards.鈥 Grosvenor鈥檚 Clarke says international standards for retrofit are also required.
Another key development is the creation of software tools to support the implementation of strategies on a global scale. IBM, for example, is using its own TRIRIGA software, which 鈥渁ddresses the problem of property management being done in silos鈥, says Joe Potter, associate partner based in the UK. TRIRIGA, which IBM claims is being used by hundreds of its clients, provides a single view of a global property portfolio in terms of its electricity and water use, occupancy levels and when leases are due to expire. Potter says: 鈥淚t prevents the classic scenario of re-roofing a building two months before the leases expires.鈥
You need very disciplined systems and a consistent corporate culture in order to achieve a uniform roll-out
Erland Rendall, Artorus Consult
IBM is in the process of rolling out the software across its entire global estate, comprising hundreds of buildings including high-energy data centres, and in the UK the system has already delivering savings in electricity and water use of up to 14%. Overall IBM says the software should lead to average savings of 5% year on year.
Software such as TRIRIGA is also a vital weapon for sustainability managers trying to influence other parts of the business because it measures performance across portfolios and links it clearly to financial benefits. Rendall says: 鈥淐ompanies need hard evidence of the long-term benefits that will be achieved to the bottom line, especially in the current economic climate.鈥
Of course, the growing adoption of 黑洞社区 Information Modelling (BIM) will also help. Gazeley鈥檚 BIM-based G3volution system, for example, was launched earlier this year. Projects are designed in 3D in G3Volution and environmental profiles of all the materials used are stored in the system, which goes on to be used as the facilities management system. Fenton-Jones says: 鈥淲e get quarter or half-hourly read-outs showing the building鈥檚 energy use. The idea is to check whether we are meeting the energy savings we predicted, and so far we are exceeding them.鈥
Meanwhile, work to tailor global sustainability strategies to local conditions, some of which we have seen here, continues. Sasakis at M&S says: 鈥淥ur approach is to adapt to local conditions depending on the different standards of sustainability, technology and resources.鈥
We will look in further depth at these flexible solutions and the sustainability challenges facing the property portfolios of multinationals in more Global Clients Group coverage soon.
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