Competitiveness and Sustainable Construction
Competitiveness and Sustainable Construction
The construction industry plays an essential role in the economy of a country and its activities are important to the achievement of national socio-economic development agenda of shelter provision, infrastructure, as well as employment. In this regard, despite there being increasingly high concerns over the effects of construction activities on the environment, some measures have been implemented to mitigate them. In many countries, mitigating factors include regulations by the relevant authorities, as well as voluntary industry-wide practices, such CSR (Corporate Social Responsibility) focused on environmental conservation and preservation, among other categories of sustainable construction oriented activities (Epstein, 2018). A combination of CSR and regulations has been able to achieve considerably impressive outcomes in enhancing sustainable construction. For instance, an increased number of for-profit and not-for-profit, and governments are embracing green energy, even in the absence of renewable energy restricting regulations. Nevertheless, despite the current progress, there is a plethora of challenges, especially regarding the ability of companies to establish a balance of purpose between sustainable and economically viable construction in the industry across the world. Therefore, a significant number of construction projects either compromise the present needs or the ability of the future generations to satisfy their own requirements, because of increased focus on competitiveness.
Current regulations and standards in the construction industry cannot sufficiently guarantee the delivery of sustainable projects, because they are considerably lenient, as well as ineffectively implemented. In many countries, there are no defined laws that define the nature of compensation that companies should offer for both direct and indirect impacts of there activities to the environment. For instance, the exact compensation that a company should offer for emitting a specific amount of carbon is not specifically indicated in many countries’ constitutions around the world. Moreover, some countries do not even have effective mechanisms to measure the amount of environment damage caused by a particular construction activity (Paris, Myatt & de Silva, 2017). Therefore, in many construction industries around the world, construction firms are at liberty to design their sustainability strategies only with regard to their profitability.
Anti-sustainable construction entities argue that before even considering the issue of sustainability, construction projects, techniques, materials and equipment must be economically viable to enhance firms to survive intensive competition in the market. Like typical business ventures, the primary objective of construction companies is to meet the operational costs, as well as offer a significant return on the owners’ investment. However, with current intensive competition, both for resources, such as manpower and construction materials, and customers, profitability improvement opportunities are significantly diminishing for construction firms. Although there are several sustainable construction frameworks, the high intensity competition is forcing companies to explore any available revenue increasing avenue at their disposal, while utilizing a significantly reduced portion of their earnings on non-profit improving activities, such as CSR, or standard. Moreover, because sustainable regulations, which can yield tremendous results in ensuring that strictly use of sustainable techniques and materials to enhance sustainability, are either ineffective or inappropriately implemented in many countries, many companies choose to either circumvent sustainability or adopt it at their convenience (Ogunde et al., 2017). Therefore, the magnitude of immediate as well as future impacts attributable to construction projects is significantly higher than the investment focused on sustainability, especially because of the overarching viability concerns emanating from intensive competition.
Apart from having direct impacts, financial constraints implemented to ensure viability possess a wide range of indirect impacts on sustainability efforts in the construction industry. Because of immense financial constraints, some companies, in an effort to maintain a desirable public image, are tempted to modify their CSR programs to satisfy marketing interests. For instance, a significant amount of CSR allocations for many of the contemporary companies is used on CSR oriented promotions and campaigns rather than on actual CSR initiatives. Such modifications largely affect the quality of CSR initiatives, hence introducing immense challenges on sustainability activities across the entire construction industry. Moreover, because there exists a thin line between CSR and marketing, some organizations reluctantly rebrand their marketing strategies as CSRs (Barnes & Parrish, 2016). Therefore, sustainability efforts are rapidly becoming weaker as competition intensifies in the construction market.
A narrow view of prosperity enhancing factors and a static perception of competition are also significant sources of sustainability challenges in the construction industry. While focusing on profitability, a huge number of companies view regulations as obstacles to competitive advantage. However, Narayanaswami (2017) notes that the conflict between economic competitiveness and sustainable construction is a false dichotomy, because tough regulations and standards can force organizations to innovate environmental friendly techniques and products with high value. In this regard, sustainable practices are perceived as a catalyst for new market openings and innovation rather than a cost. For instance, the High Speed 2 project’s innovative design, which largely avoids designating depots on wetlands, significantly reduces the project development costs, because marshland construction are considerably cost intensive (Paris, Myatt & de Silva, 2017). In this regard, the project meets sustainable construction demands, while being significantly cost effective. Regardless of this fact, some companies still consider sustainable development an additional cost, especially because of innovation seed capital, which can take extended durations of time before yielding substantial results. Therefore, a considerable number of companies circumvent sustainable development practices, because of the false profitability dichotomy.
Most of the current construction projects either compromise the current needs or those of the future generation, because of intensified competition in the market. Despite sustainable construction possessing immense benefits, especially by improving innovativeness, a huge number of firms in the industry still consider it a source of additional costs. In this regard, to improve profitability, such companies circumvent sustainable construction practices, such as CSR. Moreover, a huge numbers of organizations either allocate a reduced amount of money on CSR, while some ignore sustainable construction regulations and standards to improve profitability. Another set of firms choose to modify their CSR initiatives to include their marketing agenda. Thus, the issue of sustainability is extremely challenging in the modern construction industry; because the significantly reduced focus it receives from relevant stakeholders. However, previous studies indicate that the conflict between environmentally friendliness and economic competitiveness of construction project is a false dichotomy. Through innovation, companies can implement sustainable projects without reducing their competitiveness at the market place. Therefore, with such facts, law enforcing authorities in the construction industry should focus on crafting and implementing effective and stringent sustainable construction regulations to ensure that firms do not compromise the needs of the current or the future generations.
Barnes, E., & Parrish, K. (2016). Small buildings, big impacts: The role of small commercial building energy efficiency case studies in 2030 Districts. Sustainable cities and society, 27, 210-221.
Epstein, M. J. (2018). Making sustainability work: Best practices in managing and measuring corporate social, environmental and economic impacts. Routledge.
Narayanaswami, S. (2017). Urban transportation: innovations in infrastructure planning and development. The International Journal of Logistics Management, 28(1), 150-171.
Ogunde, A., Olaolu, O., Afolabi, A. O., Owolabi, J., & Ojelabi, R. (2017). Challenges confronting construction project management system for sustainable construction in developing countries: Professionals perspectives (a case study of Nigeria). Journal of Building Performance, 8(1), 1-11.
Paris, R., Myatt, C., & de Silva, M. (2017, November). Crossrail project: environmental management during delivery of London’s Elizabeth line. In Proceedings of the Institution of Civil Engineers–Civil Engineering (Vol. 170, No. 6, pp. 49-55).