Spring is Sprung and Flowers are Popping Up Everywhere
In May I’ll be attending a workshop to explore harmonization of methodologies to assess the environmental, social and economic impacts of an investment. Hosted by Lise Laurin, CEO, of EarthShift Global, LLC, Lise has been trying for several years to gather decision makers and pioneers in the areas of value-based Sustainable Return on Investment (SROI), Multiple-criteria decision analysis (MCDA), Sustainability ROI, Social ROI and others for a workshop to explore what we have in common. The goal is to begin speaking with more of a single voice; helping those who would like to look into this further the understanding that there is consensus on many of the aspects of these assessments.
The workshop will be held in conjunction with the ISSST 2016 conference – International Symposium on Sustainable Systems and Technology. Below is the abstract from a paper by John Williams and I. I’ll post a link to the whole paper after the conference.
Standards engender productivity. They reduce waste, improve communication, and reduce risks. By not counting the full social, environmental and financial cost of their projects, the engineering and architecture community is unnecessarily increasing the financial risk of their firms and of their, and their clients’, infrastructure projects. This paper describes how making comprehensive cost benefit analysis (CBA) part of infrastructure planning exposes environmental and societal risks that may become financial risks. To do this CBA has to be standardized and embedded into engineering, architecture and design processes such as Building Information modelling (BIM).
Many of the intangible costs and benefits encountered during infrastructure projects are related to sustainability. Project delays can be caused by not anticipating risks, regulatory delays, or stakeholders’ perceived negative consequences. If an Architecture, Engineering and Consulting (AEC) firm is designing an infrastructure project and has not developed a plan to deal with wetland loss it may have angry birders on its case. When peoples’ hackles are raised, environmental and social risks can quickly become project and financial risks with real dollar impacts. This is why so many companies in industries with active opponents or sensitive stakeholders are using CBA to put prices on non-market goods and services.
Infrastructure projects should take responsibility for their externalities. The demands to plan, build and operate responsibly are dramatically increasing. Standardization of the data, methodologies, and output from CBA is required to make it accessible to AEC firms in their familiar planning, design, and construction processes. A standardized cost benefit framework that monetizes externalities allows AEC firms to respond rationally and in ways that are simultaneously defensible and transparent to all stakeholders. Using non-market or shadow prices, internalizing externalities, or valuing the environmental, social as well as the financial risks are all ways for AEC firms to address the obligation to fully assess the impacts and returns associated with their infrastructure projects.
Proceedings of the International Symposium on Sustainable Systems and Technologies(ISSN 2329-9169) is published annually by the Sustainable Conoscente Network. Jun-Ki Choi and Annick Anctil, co-editors 2016. ISSSTNetwork@gmail.com.
Copyright © 2016 by John C. Parker, John F. Williams Licensed under CC-BY 3.0.