Reimagining Sustainable Buildings: From Materials to Practices

Executive summary:

• The construction industry is resource-intensive, contributing to 39% of global carbon emissions.
• Limited visibility of raw material origin leads to the use of environmentally unfriendly materials. However, innovative sustainable materials and waste minimization strategies can help.
• There is a disparity between project owners and construction firms on ESG trends, with owners prioritising emissions reduction and contractors focusing on social factors.
• Scope 3 regulations will demand transparency on embodied and operational carbon.
• KPMG Origins revolutionizes carbon reporting and offers trust and visibility in the supply chain. Sustainability is crucial in construction, with economic and environmental benefits.

We understand the importance of sustainability and reducing embodied carbon in the construction industry. Construction is one of the most resource-intensive industries in the world, using a lot of energy and creating a lot of waste.¹ In fact, according to the World Green Building Council, the construction industry is responsible for an estimated 39% of global carbon emissions.²

Unfortunately, numerous environmentally unfriendly construction materials continue to be used frequently in today's construction projects. The continued use of these materials can be attributed, in part, to a limited visibility of the origin of raw materials. For instance, a mere 55% of engineering and construction companies possess substantial or thorough visibility into their own operational procedures, and only 16% have equivalent insight into their suppliers' processes.²

Moreover, forward-thinking companies have been at the forefront of developing sustainable building materials that not only emit lower levels of carbon but also have the remarkable ability to absorb carbon dioxide from the environment.² In addition to these groundbreaking innovations, there are practical measures that can be implemented to minimise waste in construction projects. These include reducing the use of virgin materials, incorporating the reuse of existing building materials, implementing effective recycling practices for materials that cannot be reused, and adopting sustainable waste management strategies.³

According to the findings of KPMG Australia's 2023 Global Construction Survey, there is a notable disparity in the perspectives of project owners and engineering and construction firms when it comes to the most critical environmental, social, and governance (ESG) trends. While project owners place a high priority on reducing greenhouse gas emissions and developing renewable energy facilities, contractors are more focused on social factors such as diversity, equity, and inclusion (DEI) and meeting government regulations. This divergence can be attributed to the fact that owners are currently being evaluated based on the emissions of their facilities (Scope 1 and Scope 2), while service providers can gain a competitive advantage by improving their DEI performance and compliance with regulations.⁴

With the growing prevalence of Scope 3 regulations worldwide, owners are expected to demand transparency from service providers regarding both embodied and operational carbon. This shift will refocus the industry's attention on total lifetime greenhouse gas (GHG) emissions. Decarbonisation has now become an essential element of every construction project, with respondents highlighting energy efficiency, reduction of construction waste, and more effective utilisation of materials as the top three crucial practices.⁴

At KPMG Origins, we empower ecosystems to flourish by harnessing the power of reliable data. Our cutting-edge platform fosters seamless collaborations between organisations, industries, and across borders to tackle global sustainability challenges head-on. With KPMG Origins Asset Impact, we accurately measure the embodied carbon of construction projects, revolutionising carbon reporting for stakeholders and regulators. Not only do we track carbon emissions, but our groundbreaking digital solution, Asset Traceability, enables trading partners to establish unwavering trust while offering unmatched visibility and control over the entire supply chain, from sourcing raw materials to the final sale. Additionally, our Building Trustworthy Indicator places data at the heart of the building lifecycle, enhancing transparency and fostering trust within the property industry.

In an era where unsustainable building materials are still prevalent, it is crucial to take proactive measures to minimise waste and enhance sustainability in construction projects. At KPMG Origins, we specialise in assisting construction companies in measuring and monitoring the reliability of materials, as well as tracking embodied carbon emissions.

With the increasing awareness of environmental issues, sustainability has become a crucial focus across all industries. Sustainable buildings not only contribute to the reduction of carbon emissions and resource consumption, but they also bring economic benefits and create healthier living environments. In this blog post, we delve into the significant challenges that the construction industry faces in terms of sustainability and provide effective strategies to overcome them. From embracing innovative materials and implementing better waste management practices to adopting energy-efficient solutions and enhancing building techniques, we explore the path towards a more sustainable construction sector.

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¹ BuilderSpace, 8 Unsistainable Building Materials Still Being Used [https://www.builderspace.com/8-unsustainable-building-materials-still-being-used]

² Forbes, 2021, The Construction Industry Is Getting Greener: Why, How, And What's Changing? [https://www.forbes.com/sites/sap/2021/08/25/the-construction-industry-is-getting-greener-why-how-and-whats-changing/?sh=65ebd0a52bc7]

³Inside Construction, 2023, How to reduce the environmental impact of construction projects [https://www.insideconstruction.com.au/section/demolition-recycling/how-to-reduce-the-environmental-impact-of-construction-projects/]

⁴ KPMG, 2023, 2023 Global Construction Survey [https://kpmg.com/au/en/home/insights/2023/06/global-construction-survey-trends-2023.html]