The challenges for sustainable development in the building industry building industry

It is since 1987, with the publication of the Brundtland Report (WCED 1987), that the global community has formally recognised the necessity of sustainable social, environmental and economic development. Since then, many efforts have been made to implement strategies to apply sustainability principles to many fields. Sustainability is conceived as the ability to produce balanced changes in the exploitation of the primary resources, in the economic models, in the direction of technological development and in the institutional development, and at the same time ensure the satisfaction of current and future human needs and aspirations. Such approach has triggered many changes within the building industry, as well as has opened a debate on the validity of the assumptions on which the innovation theory and the classic economic models were based on.

2.3.1 Paradoxes between concepts of economic growth, progress and innovation, and sustainable development

Higgin (2013) explained that the interest in the connection between economic growth and the limits of Earth’s natural resources had been lacking up until 1972,

when members of the Club of Rome (politics, business people, and scientist) published an alarming report regarding the potential collapse of physical growth on earth due to pollution, depletion of resources, and excessive population growth.

Since then, many authors explained that paradox exists between the concept of economic growth, progress and innovation, and the one of sustainable development (e.g., Higgin 2013; Gauvin 2011, Meadows, Meadows, and Randers 1972; Chomsky and Polk 2013; Haapanen, Liisa & Tapio, Petri, 2016). Haapanen, Liisa & Tapio, Petri (2016) categorized the critique to economic growth as:

phenomenon, institution and ideology. They explained that growth as phenomena is criticised for growing negative effects such as the impact on the environment, the lack of well-being increase, and the inability to decouple its positive effects from the those negatives. Moreover, growth as institution is conceived as a mutual dependency between consumer culture and societies, and this lead to the ‘dilemma of growth’ (Jackson 2009). Such dilemma is given by the fact that unsustainable growth can be due to its increasing negative effects while de-growth would lead to instability under present conditions (Haapanen, Liisa & Tapio, Petri, 2016). The last major critique is the conception of growth as ideology, and in particular in relation to the idea that growth is equal to well-being. The core of such critiques can be summarised in two concepts: the assumption of the existence of unlimited resources (Lewis 1954), and the idea that individuals would act according to rationale behaviour (Seaden 1996). This latter concept has been already criticized by a vast of behavioural economists, as well as discussed by Rosenberg (2004) arguing about the difficulties is anticipating the users’ response within markets and economic models in general. Moreover, Gauvin (2011) explained that it seems to be very difficult to establish the boundaries of the concept of satisfaction and therefore of limits of consumption. Whereas the concept of unlimited resources seem to be the key of the critiques to the dominant economic model.

Daly (2013) explained further that the Gross Domestic Products (GDP), which is the measuring system for growth of countries, does not take into account the concept of physical limits. This aspect increases the tension between the matter-energy relation, which Daly (2013) described as starting with depletion and ending with pollution. Moreover, Higgin (2013) explained that although the concept of growth is characterised by a number of benefits - such as the relation between business and nations profit and the individual availability of jobs, resources and quality of life – yet, it also feeds on natural resources, produces waste, pollutes the air, and put at risk the climate. Moreover, Higgin (2013) argues that such characteristics produce a reinforcing loop created by the constants call for technological advances and innovation that requires ruthlessly the consumption of resources leading to the progressive collapse of the economy, environment and society. Yet, Gauvin (2011) explains that at least three directions have been suggested to attempt overcoming such contrasts: 1) continues economic growth; 2) economic growth up to certain limits; and 3) economic growth reduction. The first approach is the one suggested by neoclassic economist (Solow 1993), which advocate for growth as the medium to solve poverty and trigger environmental productions. The second approach is the one of the steady state

economist (Georgescu-Roegen 1975; Daly 1993) which consider economies as limited by biophysical realties and that they should rather adjust to steady sates.

The last approach, called ‘the de-growth movement’ (Martinez-Alier, Pascual, Vivien, & Zaccai, 2010) suggest instead to embrace simpler life outside of the economy. Haapanen, Liisa & Tapio, Petri (2016) tried instead to overcome those positions by suggesting to shift the focus from the debate of increasing or describing growth, to the one of supporting human well-being and alleviate environmental degradation. Haapanen, Liisa & Tapio, Petri (2016) argued that:

‘…Positioning economic growth as a constituent of sustainable development unnecessarily and counterproductively narrows down the selection of means by which sustainability is pursued’.

2.3.2 Sustainability as trigger for changes and innovation generation

In the context of sustainable development, the challenges in the field of architecture and construction are widely discussed and influenced by the actions proposed in Agenda 21 of the United Nations Conference on Environment and Development in Rio de Janeiro in 1992 (UN, 1992a) to address a range of social, economic and environmental challenges (Cardonna, 2014; Hensel and Nilsson, 2016). The United Nations Framework on Climate Change in 1997 (UN, 1992b) and the subsequent Kyoto Protocol (UN, 1997) for reducing emissions of greenhouse gasses (GHG) in the countries which signed it, focused on reducing the causes of climate change. The Kyoto Protocol objectives were reiterated and extended in the Paris Agreement in 2015 (UN, 2015). As a result, many countries have developed frameworks and regulations with the aim of contributing to this environmental challenge. In 2013, the European Commission released the European Performance of Building Directive (EC, 2013), a legislative document that promotes the improvement of energy performance in buildings. The building sector is responsible for almost 40% of total primary energy consumption in developed countries (Berardi, 2017; Orme, 2011). This percentage includes energy demand for space heating and cooling, hot water production, lighting, cooking and other appliances. In addition, considering the global warming effect of a persistent increase of GHG emissions, the energy consumption for space cooling is rising in several countries (Givoni, 1994; Santamouris, 2007). Yet, building activities play a crucial role in the economic development of countries (Ruddock, 2009) by generating links on multiple levels: firstly, with the activities carried out around a specific building project; secondly, with other industries related or connected to these activities; and thirdly, with the economic environment in the long-term (Pearce, 2003; Turin, 1980). Pearce (2003) suggests that improving the built environment is critical to social sustainability and improving quality of life. Woodcraft et al. (2012) explain that there is a need for

‘… a process for creating successful places that promote wellbeing, by understanding what people need from the places they live and work. Social sustainability combines design of the physical realm with design of the social

world – infrastructure to support social and cultural life, social amenities, systems for citizen engagement and space for people and places to evolve’.

In response to these environmental, economic and social challenges, the actors involved in the building industry are producing innovative design solutions that convey the values of sustainability and aim to achieve related performance targets. The field of building has therefore faced a paradigmatic shift in many instances, from the proposals for new design strategies to the development of novel management systems for emerging social, environmental and economic challenges (Hensel and Nilsson, 2016; Kibert, 2016). This is due to the tight relation that the industry has both in its resources consumption and in its outputs.

The building industry is not only responsible for a significant percentage of countries’ GDP, but also is a vehicle of means and methods that connect economics, conceived as discipline to manage resources, and design organization meanings. Therefore, the call for sustainability and the debate with the economic principles that shapes most the countries activities had and is having a strong reflection on the practice on many levels. One of these level is the innovation management in design and delivery processes in buildings. Innovation is recognised as crucial to foster changes and stimulate progress (Latin: progressus - to advance, to go forward). Radical innovation, in particular, is recognised as a medium of advancement, a source of growth for economies and a trigger of progress (Sood and Tellis, 2005; Gambatese and Hallowell, 2011, Coccia, 2017).

Often, this type of innovation is linked with technological advancement, disruptive phenomena and the creation of new systems and dynamics (Tellis, Prabhu, Chandy, 2009; Winch, 1998). Ahlstrom (2010) associates radical innovation and deconstruction of existing systems in favour of technological advancement with development models based on unlimited growth and resource exploitation (Ahlstrom, 2010). The awareness of the limits of growth, raised in the

‘70s by Meadows, D., Meadows, D., Randers, J. and Behrens, W. (1972), is influencing approaches to innovation which consider resources as limited (Becker, 2013) and require types of innovation which contribute to sustainable development. The number of design approaches proposed in the field has progressively increased. Guy and Farmer (2001) identified at least six approaches to sustainability in architecture: technic, centric, aesthetic, eco-cultural, eco-medical, and eco-social. Lee (2011) highlighted at least twenty-five approaches to design changes required in the context of sustainable architecture.

Each of these approaches proposed design changes (innovation) in different categories of the projects and processes, resulting in often non-uniform design solutions and leading to the discussion and definition of debated positions on design changes and approaches to the design of sustainable architecture (Hosey, 2012). For instance, Hosey (2012) points out that the aesthetics of sustainability – defined here as a set of principles conveying the idea of sustainability - is not easily definable within purely design boundaries. This seems to be due to a number of reasons: the complexity and multi-disciplinarity of the concept of sustainability; the plurality and fragmentation of design approaches; contradicting political views on sustainability itself; and challenges in re-organising and

evolving the practice around the stimulus that sustainability generates (Hensel and Nilsson, 2016; Kibert, 2016). Yet, the production of successful innovative and sustainable buildings can contribute in improving the existing built environment, by: 1) improving sustainable technical efficiency and aesthetic of the environment, 2) accommodating social changes throughout time, improving life quality, and 3) produce economic expansion and positive results (Pearce 2003).

2.3.3 State of art on sustainable innovation in the building industry

Bossink (2011) explained that the importance of sustainability has triggered a shift of paradigm among the industry. In line with this position, Huovila and Koskela (1998) explained that: ‘…while traditional design and construction focuses on cost, performance and quality objectives, sustainable design and construction adds to these criteria minimization of resource depletion, minimization of environmental degradation, and creating a healthy built environment (Kibert 1994). The shift to sustainability can be seen as a new paradigm (Vanegas et al. 1996) where sustainable objectives are within the building design and construction industry considered for decision making at all stages of the life cycle of the facility… However, it must be said that a solid methodology for implementing sustainable construction still lacks’. Such gap also exist in the literature about sustainable innovation management. While on one side the innovation studies are characterised by the complexity of the sector itself, on the other side the role of sustainability seems to make the ability to researching the topic even more complex and complicated. Yet, Bossink (2011) and Kajander (2016) identified at least three research streams that explore sustainable innovation management in the construction industry. The first one is concerned with role of government in fostering sustainable innovation in buildings. Such role is found to be covered by different strategies, such as: the implementation of national environmental policy plans; the issue of laws and regulations; the negotiation of sustainability with the firms in the industry; the financial incentives and pressure; and the use of project as demonstration or best practice. The second stream of studies focuses on the role of firms, which may not await for the government intervention, rather they trigger sustainable processes. This might be due to a number of reasons, such as conceiving sustainability as a business opportunity for new cost-effective services and products (McKinsey & Co., 2009), or the results of the emergence of a number of sustainability assessment tools to assist the practice such as LEED, Greenstar, BREAM, NABER, and many other (Kibert 2006; Cole 2000; Toss et al. 2001). Also the emergence of environmental management system seems to support firms in integrating sustainability within their corporate strategies, core business, or market strategies (Bryson and Lombardi 2009). For instance, Kajander (2016) highlithed that investors and developers benefit from buildings with environmental certification due to additional occupier benefits, increased rental income of about 3%

(Eichholtz et al. 2009; Kajander 2016). A third stream of research focuses on the

cooperation between private and public entities. Bossink (2011) explained that great degree of participation processes characterises these endeavours, as well as they allow organisations to acquire competitive advantage in the field of sustainability, and to shape market niche for environmental aware customers.