We have all been thinking about the "E" in ESG following COP26. According to the UK Green Building Council, 25% of the UK's total carbon emissions derive from buildings and infrastructure, and that figure rises to 42% if surface transportation in the built environment is included. Globally, 40% of carbon emissions are considered to emanate from the built environment, and the world continues to urbanise fast. By 2050 it is estimated that 68% of the world's population will live in urban environments, equating to seven billion people. This position of course contrasts with the huge swathe of human history during which the vast majority of the world's population lived in very low-density rural environments.
Until recently, much of the focus of the construction sector in carbon terms has been on operational emissions. This is a relative success story as over the last two decades, initiatives in this area have seen overall emissions reduce by circa 30%. Now however, the focus in the construction and infrastructure sectors is rightly shifting to embodied carbon. As Alan Muse, Head of Construction Standards at RICS has pointed out "if cement were a country it would be the third largest emitter of carbon in the world" (after the USA and China).
So we know we need to de-carbonise construction to get to net zero by 2050. We know that needs to be about both operational carbon but also embodied carbon. But we also need an agreed way of measuring progress made in that regard, and comparing that progress on an international basis. That is why a development this week is of particular strategic significance, namely the launch yesterday of the International Cost Management Standard version 3 – or ICMS3 – by a remarkable collaboration of 49 international public benefit bodies, led by RICS in partnership with the UK's BRE, CIOB, CIBSE, UKGBC, ICE, IStructE, RIBA and The Carbon Trust.
For the first time, these bodies have included within their international standard a detailed methodology for construction professionals and developers to account for the amount of embodied carbon their projects create, across multiple different built environment and infrastructure sectors. ICMS3 also facilitates evaluation of the full life cycle, cost and carbon impacts of a building or piece of infrastructure on a whole life basis.
This new ICMS3 standard deserves widespread UK construction sector and international support if we are to be serious about tracking the progress to net zero that needs to be made. As others have pointed our "multiple standards means no standard at all". Without a common data collection and evaluation standard, carbon comparisons will at best be superficial and, at worst, meaningless.
Reaching consensus - domestically and internationally - on how to measure and report on Whole Life Carbon will become increasingly important if and when mandatory measurement is introduced into the UK Building Regulations. The UK Green Building Council's recently published "Net Zero Whole Life Carbon Roadmap" (November 2021) shows this development as its first item on the "2020s" timeline (see page 9 of that report).
There are of course complex trade offs to be considered in the journey to net zero, but by placing a common evaluative process and standard around both cost and carbon ICMS3 is signposting an end to the old world sterile "cost v. carbon" debate and focusing us instead on how cost and carbon need to be aligned in the new economy, and managed and reported on independently and professionally.
And who will be the auditors of this new carbon economy? So far as the built environment space is concerned, it surely has to be the chartered surveyors who are best placed to take on this role? They can use their centuries old experience of measurement, standardisation and cost control to adapt to the new economy of carbon measurement and reporting. Lawyers will play their role in translating new standards and reporting obligations into contracts, but the surveyors will be the "carbon contract administrators".
If you have any questions about ESG and the road to net zero, or would like to know more about our construction services, please contact David or your usual Charles Russell Speechlys contact.
"If cement were a country it would be the third largest emitter of carbon in the world and so action to de-carbonise construction is required now." Alan Muse, Head of Construction Standards at RICS and ICMS lead