Whilst the Government is encouraging individuals to go back to their offices and workplaces, the general trend is for those workplaces to be occupied at a fraction of their full capacity, with individuals working there a couple of days a week when possible. For many people working in retail and manufacturing, this isn’t an option due to workplace management needing to accommodate additional risk control measures. Similarly, many in the FM sector have been working on site for many months as part of the necessary and critical roles that FM provides. But in the service sector, this leads to people–based challenges.
Working from home in the summer
For those working at home, the summer months have been challenging with temperatures hitting above 30ºC for many days. This has made the ability to concentrate for long periods of time difficult in a country where poor building design has led to overheating of homes and flats. This has corresponded with a massive increase in the number of air conditioning units being purchased for homes to provide some respite during these warmer days – representing an increase in energy use in these short periods.
The new challenges of winter
But the bigger challenge will come during the winter months stretching from November through to early spring. During these months, the temperatures will drop significantly. The requirement for heating increases and, with the majority of UK housing being poorly insulated and falling below the EPC C grade, this means a highly inefficient winter is approaching for those working from home. This doesn’t even incorporate the additional challenges of wellbeing, as the lower levels of sunlight are known to have psychological affects on individuals who will be working in isolation for longer periods of time.
The existing housing stock across the UK is known to be poor, with badly insulated properties requiring constant heating to maintain an operable temperature in which to work productively. Whilst the extremely warm weather is more difficult to predict but only lasts for a week or two at a time, the winter weather is more predictable and lasts for several months. The role of organisations to support their workforce is therefore critical and, if not managed, may lead to staff and morale issues that affect productivity. There are a range of challenges that individuals and organisations will face:
- Cost – Lower temperatures require more heating and higher energy bills. Whilst there is a cost saving from reduced travel, there is a question of how this is managed from the increased winter costs. For some, travel is a higher expense, but for others, energy will be.
- Wellbeing – Shorter days does have an impact on wellbeing and greater need for engagement. Closed windows may also affect air quality in the working environment. How does a company manage this?
- Governance – Working from home can no longer be considered a temporary emergency activity and a more considered approach to risk assessments and health and safety is required. Muscular/skeleton issues, sight issues, activity levels will all affect the individual and their productivity.
- Carbon – The increased level of gas heating predominantly will have a significant impact upon carbon emissions and should certainly be included within an organisations carbon footprint. It remains to be seen whether transport emissions savings offset heating savings in a carbon capacity.
What are organisations doing?
Organisations are taking different approaches. There are many real estate directors strategising the fate of their property portfolio over the coming year:
- Some companies, such as banks, are looking for staff to work in regional retail locations. This could help to re-engage corporate culture while offering potential to reduce health and safety travel risk.
- Others will be consolidating their portfolios over the years ahead, and will continue to encourage their teams to work from home permanently.
- Some have arranged rota systems within their portfolio to encourage team working and communication in a socially distanced environment.
- Forward-thinking organisations that have already identified risks of home working have invested in staff home offices with furniture upgrades for their teams.
There is a need for organisations to be more proactive and identify those individuals who are at risk from their chosen working environment during the coming months. Counter intuitively (at this moment in time), they may require some individuals to not work from home for health and wellbeing reasons as we consider health implications beyond the all-consuming risks of COVID19. Either way, open two-way communication lines with individuals that may suffer is needed to ensure that health from a physical perspective and a mental perspective is considered.
This is a complex issue that incorporates health and safety, wellbeing of individuals, productivity of a company, staff morale and corporate culture. A well thought out approach is needed as the winter draws in. Should you have any questions about the content of this post or any of our other services, please don’t hesitate to get in touch.
Read the first post in this series: Optimising Energy Performance in Buildings: An Introduction.
Employee engagement, investor pressures and business drivers such as carbon neutrality is encouraging many organisations to make bold commitments. Beyond these commitments is a need to better understand carbon emissions for an organisation and how to mainstream efficiencies and behaviours into the culture. This article will look at developing a strategy and plan from this business case to take the programme beyond a short-term initiative.
What is driving the change in corporate behaviour?
Let’s start by looking at the drivers affecting energy performance in buildings.
Employees are increasingly becoming a major driver, with corporate responsibility and putting purpose over profit necessitating the right culture to attract and retain talent. This starts at the recruitment phase, by attracting individuals who align with the values of the business.
Regulation has certainly played a major role in the past 15 years, raising awareness and providing data to enable informed decisions to be made. But a lack of enforcement and incentives for implementation has seen much of the early ambitions on savings fade away. Costs are also anticipated to increase significantly by up to 100% due to the rising cost of fuel together with the additional costs to maintain and upgrade the infrastructure. We are seeing this shift already in the proportion of energy bills related to consumption and to overhead charges.
Investors are also taking a keen view. The Task Force on Climate-related Financial Disclosures (TCFD) sets out requirements for financial disclosure of climate risks which all stock market listed businesses need to respond to. Property is one of the biggest risks to an organisation, with climate change negatively affecting the book value.
Many of the changes are coming top-down. Regulation will play a limited role if low enforcement continues, with investors, cost and employees placing pressure on larger organisations who cascade down the supply chain. The traditional barrier for most organisations has been the ability to translate these drivers into actions and then communicate the results. How to do this is via a strategy which has defined targets that align with the business.
Developing a Strategy
Building a strategy requires knowledge from a range of departments and activities within the organisation from operational management and implementation, strategic changes at an organisational level, procurement ethos and structure of contracts together with external factors such as client and market demands. Much of this will depend very much upon the culture of the business and its approach to both risk and returns, together with its maturity on the sustainability curve.
A critical output is the ability to measure, track and value the impact of sustainability activities on core business and financial metrics. To do this requires an understanding of the underlying drivers and provision of a single-measure performance indicator to communicate the value of these sustainability activities.
The first step towards developing a strategy is to perform a materiality review – looking at a matrix that links the importance of sustainability to both the business (e.g. delivering value) and external parties (e.g. managing risks). The process of understanding the business and stakeholders is often underestimated but can provide a very clear insight into how value can be generated in conjunction with improved sustainability performance. A starting point for the materiality review can be taken from the SFMI assessment which has defined 23 material issues for the FM sector, but which can also be used as a good starting point no matter what sector your business is in. Data will be required to support the review together with interviews to provide the supporting context.
Incorporating supply chain activities within the materiality review is important, helping to bring in the wider impacts of the operations and therefore the potential additional value – this will also mean understanding them as stakeholders with regards what can be achieved.
Plotting the matrix will essentially be a series of dots, with those in the top right quadrant typically identified as those which are important to stakeholders and will also deliver the greatest value to the organisation. That is the starting point, because each of these will need to be developed and implemented, with progress and value communicated through a series of actions or defined targets.
The resulting outputs of this review, the actions implemented, and the value captured will help to communicate to the senior management in a language that they understand.
Changing the Corporate Culture
Responding to market pressures such as carbon neutrality and removal of single-use plastics, without being part of a wider strategy, will not change the corporate culture, but will only reinforce the idea of task-based activities being the sole remit of the facilities management team.
The value and benefits of a company-wide strategic approach need to be communicated in a language which is understood and connects directly into the reporting measures. This doesn’t have to be about just costs, with employee engagement and investor pressures also significant – graduates raising the organisations sustainability performance at jobs fairs provides an evidence that can be captured, but needs discussion with HR.
In many cases, to achieve the value there will be shared responsibilities and outcomes which will help both parties – ‘what’s in it for me’. The move towards employee engagement programmes is a prime example of this, helping reduce turnover and improve satisfaction.
The imperative is not just internal or the remit of one particular department, but with the wider business including procurement and supply chain management, which will have a key role. It is this activity that our third article will focus upon.
Embracing Technology in the FM Sector
Technology is all around us and continues to encroach into our lives. Whether through the applications on various office appliances, voice-controlled tech at home, or the sensors used to measure and improve the space we live in. We have an enthused world where anything is possible with the use of technology. The role of technology and its disruptive influence is one of the three key themes that was identified in the RICS Responsible Business Forum. This article explores some of the challenges ahead with the impact of technology on the built environment. Is your business fully embracing technology?
Setting the Expectations
Data-enabled systems have become the standard operating approach for many. The potential opportunities to save costs and improve the workplace are widespread. But, cutting through the sales talk and communicating the benefits to your clients or your business is tougher.
The challenge with communicating the benefits is the balance between perception and what can be delivered today – which is very much about setting expectations. There is often a need to oversell the opportunities that can be achieved or underplay the integration costs. In part, this is led by misunderstandings by leaders on the role that technology can take, and a lack of experience on the ability to deliver and achieve results from data.
Simplifying what the technology is, how it is being used and the resulting data that can be utilised is fundamental for communicating the expectations. There are also lessons that older business leaders can learn from the younger generation in technology.
Getting Technology to do what we want it to do
So, what do we want the technology to do and how will it help us? We are all still the same people, but adding layers onto needs. Technology can help this and the interface is still important. In the built environment, we use technology to:
- optimise or reduce plant run times through AI,
- ensure space is optimised for user comfort,
- help teams to optimise condition-based maintenance programmes; and
- extend asset lifetimes.
Together this has significant benefits to the energy performance of the building, employee wellbeing and cost savings.
However, over-reliance on technology can mean we lose the ability to communicate with each other. People skills are vital in the FM sector, but with technology becoming the interface instead of the person, it promotes small changes in behaviour. For example, leaving a message instruction to another to close off an issue rather than seeing a problem through to the end. This encourages a loss of accountability for activities along with the loss of team working.
Rise of the Data Analyst in the Responsible Business
Technology can enable FM to be more customer-focused, but its advance requires new skills. For example, the ability to analyse the data that is being generated. Whilst AI tools are available, the dynamic approach of most organisations will require individuals who understand the data to translate it to a people/ business perspective.
Not only are employee skills sets changing, but the requirements on business is changing too. The level of data captured increasingly infringes on personal information. Therefore, disclosure and openness about what data is held is critical. Gaining confidence from workers on this subject will require communicating the reasons why data is held, and the benefits of holding the data. There will be kickback to this, and the use of opt-outs will help to provide a mechanism to act on this.
We are moving into a sphere where organisations are challenged about what they stand for. It is no longer about money, but increasingly about purpose, transparency and values. Those entering the workforce want to work for organisations that share their beliefs, which are becoming more altruistic. Commercials are good and an absolute necessity, but so too are the ethics – how do we get this mindset through to the FM sector?
Integrating Technology into FM
This provides a very different role for FM moving forwards. A role where technology is integrated into the service, and key skills revolve around customer service and data analytics. But being mindful of the disruptive influences that could be lurking on the horizon. Improvements in technology could easily lead to the ‘uberisation‘ of standard services – particularly maintenance and hospitality functions. Has the industry considered this though?
With new technology part and parcel of modern life, it is illogical for the FM sector not to embrace it. However, the integration of technology through the lens of a responsible business is necessary. Weighing the balance of environmental improvements with social and Governance costs is fundamental. Look out for the release of the RICS Responsible Business Leaders Forum Report at the end of the Summer 2019. We delve into these challenges further as we seek solutions for the sector.
For more information on the RICS Responsible Business Forum please visit the RICS website
Sunil Shah, Chair RICS Responsible Business Forum and Managing Director, Acclaro Advisory.
There is a new craze moving through sustainability teams. That craze is Social Value. It’s like the gold rush of the 19th Century. Ok, I admit, I greatly exaggerate. But observing the approach taken by procurers, corporate’s, service providers and NGOs is fascinating. Only instead of rushing for precious metals, there’s a rush for a perceived value that is generated from an elaborate spreadsheet.
A brief Catch-up
While Social Value came to notoriety in 2012 with the establishment of the Social Value Act, the regulation has made little impact. While generally well-intentioned, has lacked guidance, direction and proved somewhat confusing for all involved.
Occasional reappearances and drives progressing the Act have been made, but the tide truly turned for the masses in 2018. David Liddington provided a clear steer with his speech in June: “it is right that we use the government’s purchasing power to benefit society”. With this, the jockeying for position ramped up.
The Government has now released its consultation on its new approach to Social Value – it’s certainly an improvement. There is direction, and clarity. Read Acclaro’s account of the consultation. The short version is, more defined social value guidance for Central Government contracts, and a minimum weighting of 10% on contracts….
10%! – This now makes social value a competitive bid winner in a tender.
Current position – Measure my Social Value Now!
How do we measure Social Value seems to be the big question. Can we provide £800k in Social Value, or £1 million? Is this value larger than our competitors? Which tools should we use to calculate how much value we create? At Acclaro and the SFMI, we hear these questions frequently. We see a massive fixation on the numbers, and this is understandable, but not progressive.
But for a company to fixate on measuring their Social Value output without a fundamental approach to support the numbers means that risk awaits the unprepared. It is a dangerous tight rope to walk.
The Problem – Where Is The Substance To The Value?
With many trying to pull numbers from the sky using one of a multitude of tools, we are on the cusp of the new social version of greenwash. Social-wash (seems to fit). Tools are often based on what a company can provide in a theoretical sense.
X numbers of apprentices = £x’s of social Value.
But when a company bids, do they have the necessary narrative to back up their claims? In the short-term, it probably won’t matter. Companies will bid with their perceived Social Value number, and the highest will gain the points on the tender process.
But… what happens when a company is held account to that number? Can they be held to account through a contract if claimed that they can contribute £x million of social value? Probably, Yes. If not then it can be forgotten. Mobilisation of a contract will no doubt result in the 15 claimed apprentices turning to 5, or even zero. Also, will those apprentices be targeted groups of people that generate real value for the needs of the community? That will depend on the ethics and culture of the business making promises. I predict that the short term will become a period of Social Value without accountability. But things will change, and it will be the responsible business leaders that prosper.
Enter the True Leaders
There are real leaders in this space in the FM industry. The SFMI assesses FM companies annually. For example, in our annual assessment, we can state clearly that Vinci Facilities and Engie are ahead of the game on Social Value. There are others who are making progress as well because they see the long term value.
So now is the time for leaders to shine. Those companies who have a solid strategic base of social value embedded into their company culture will be able to provide their numbers alongside the important narrative that validates their claim. They can give past performance to instil confidence, and they can give systems and strategies on the way that Social Value is generated with their clients.
It is for this reason, that Acclaro and the SFMI are measurement agnostic. We have developed the Acclaro Social Value Programme that is tailored to developing leadership in this space, and to give a meaningful substance to the numbers.
We are not about the numbers first. Numbers are the product at the end, but so many are seeing the numbers as the beginning and the endgame. We help a company to develop a structured approach to drive social value to truly benefit society based on the needs of the community. We follow a specified approach summarised below
Our approach is to base the numbers on a solid strategic foundation of generating Social Value at both the corporate and contractual level. If a bid contains a 15% weighting of social value, it is a natural progression to require validation of those numbers. Therefore in time, half of that 15% is the measured output number, and half will be the narrative, strategy and validation of those numbers.
This is where the Acclaro Social Value Programme is aimed at. In the Acclaro approach, we; assess, engage, define, execute and operate Social Value in a fit that is right for your company. You can be a company looking to create value for your clients, or you could be a client that is looking to generate social value from procurement. Our approach follows a similar approach with different detail. We build purpose driven leaders.
Acclaro helps you to plan for the long term and develop your approach to Social Value. We give you confidence in your numbers whether bidding for contracts, or procuring for services. Contact us to discuss further
Social Value – Where we were:
Almost 9 years since the Public Services (Social Value) Act was introduced it has become widely discussed, however, there are still issues in implementation. Despite a number of updates, the Act remained underutilised as procurement and procuring organisations were confused about its scope and application. Some viewed it as a replacement for CSR; some as additional.
The term “Social Value” steered many people away from its application in environmental improvements, though these too have social impacts. As industry and public bodies alike have been building knowledge bases on social value the understanding of its benefits has grown – along with knowledge of its complexity.
The Act so far has been adopted both in the public and private sectors. The UK Government has put out to consultation a new model for Social Value in Procurement. Although focused on government procurement, this model, as the initial Act, could be utilised across industries to inform social value approaches.
Acclaro’s opinion on the consultation:
The consultation out now proposes a “light touch” approach using a new model. It also provides high level and detailed guidance and links to relevant policy information that can support social value efforts. The model is split out into 5 high-level themes, 2 relating specifically to supply chains (Diverse Supply Chains; Safe Supply Chains), 2 involving staff (Skills and Employment; Inclusion, Mental Health and Well-being) and 1 on environmental sustainability. There are suggestions for each theme, in varying detail, of award criteria and measurement metrics to guide increased reporting. This would have a significant positive impact, encouraging accountability and long-term monitoring.
The additional detail will go a long way to expanding uptake of social value beyond large public sector projects as the concept becomes easier to understand, implement and report on. With the concept and practical application of social value still a maze to many the direction from government to other specific policy documents (including: Post-16 Skills Strategy; Integrated Communities Green Paper; Greening Government Commitments) and external guidance (e.g. Business in the Community’s Race at Work Charter) will prove a welcome new structure.
What’s still missing:
The mandatory 10% social value weighting in contract tenders is good – though not a new or ambitious strategy. Other larger weightings for social value have already been implemented within some tenders. Issues with current social value measurement systems – their inconsistency, lack of accountability, and corruptibility – mean this would need to include both numbers and discussion for credibility. However, this takes time that many public sector teams do not have. Thus over-reliance on untrustworthy figures alone is likely to continue.
Though environmental improvements are explicitly mentioned and categorised in the model they are limited compared with others. Some of the additional detail will be effective, however, the policy outcome of “environmental impacts are reduced” is unlikely to provide much guidance to those looking to implement. They will need to rely heavily on the 25 Year Environmental Plan – which does not use the terms “social value” or “social impact” once. The connection between environmental and social value remains undefined in this guidance.
Although under consultation and therefore liable to change, this document provides a major improvement in structure and guidance for everyone implementing social value. It will be important to keep monitoring and improving on the process as it is implemented and continue to update the system as the landscape changes.
We welcome discussion
We will be writing to necessary consortiums and bodies to provide our opinion and discuss further. If you are interested in discussing the consultation with us, please do get in contacts. Cara.firstname.lastname@example.org
Implementing meaningful sustainability
Implementing meaningful responsible business attributes within the built environment requires engagement of all levels of the chain – the developer, constructor and operators of facilities. Increasing complexities of roles and knowledge involved means this is no longer possible through a single body or simplified framework across the property lifecycle.
Acclaro Advisory and the SFMI (Sustainable Facilities Management Index) are delighted to be a major contributor to a collaborative approach in partnership with RICS. The aim is to create the new model necessary to transfer knowledge of sustainability through the property lifecycle. Sunil Shah, MD of Acclaro Advisory will be chairing a series of discussions across the globe, with the SFMI team developing and building upon the necessary discussions to develop a single approach for the industry.
For a long time, collaboration has been key for organisations to deliver sustainability; it has been the subject of many reviews within the property sector from the Latham Review in 1994 through to the present discussions from the Hackett Review. We have experienced a rise in dialogue develop between a client and their major suppliers, together with a governance system between the two stakeholders. Much of this is measured in more complex projects to improve performance and outcomes – great news for the parties involved!
Professional bodies, on the other hand, are showing a different approach to advancing the sustainability agenda. An increasing number of groups are jostling for position and funding. They are focussing on what separates or differentiates themselves from their peers. However this doesn’t promote a sector or an industry in a cohesive way, nor does it show leadership internally or externally. Discussions are blighted by arguments over semantics (the most recent is that experienced on the definition of Social Value), and with so many opinions there is little room to tackle key areas that would give consistency and a common approach for the good of the sector.
What we need is a more joined up structure
RICS have been taking a lead on one area related to Responsible Business. As the appointed Chair of the Forum, I (and our partners at RICS) see the importance of collaboration across the delivery lifecycle for two main reasons. First, is to ensure that as a collective we are working together and that multiple points will drive changes in behaviour and the need to comply. Secondly, simply, is that no organisation knows everything and that to build a practical response spreading over the lifecycle of a property requires a number of actors knitting their specialisms together.
The journey that we have been on in the sustainability sphere has promoted environmental specialisms including energy, waste and water, largely because they were easy to measure and understand. Social aspects have been considered by organisations for a long time, slowly becoming more widespread. For example, it formed a fundamental part of the London Olympics legacy programme.
In fact, volunteering and philanthropy have been easy wins for businesses to prove corporate responsibility with minimal strategic considerations. However, we haven’t had a structured approach. Since 2010, there has been a step change in the role of society within the sustainability framework.
Regulation in supply chain management (through Modern Slavery and Social Value ), the conceptualisation of wellbeing (through mental health awareness and workplace productivity), and increased competition for talent have driven employee development up the agenda.
Looking into the future, we can see the increasing trajectory of societal and community needs as part of the built environment dovetailed into environmental requirements. Assessments of place and occupier services will be based upon the provision of these services and engagement with the community to drive improved satisfaction, a safer environment and a location where people want to work.
Technology will play a significant role in this. The deployment of technology is driving the collection and use of data, but we have yet to answer the question of who owns this data. We are entering into space where knowledge is being captured that can denote the behavioural characteristics of individuals to help provide a tailored working environment. Should individuals be made aware of the data held and how it is used? Protocols are necessary –technology and data are a vital part of our necessary progress. – but a negative perception can damage the brand of an organisation quickly.
The Solution – The Responsible Business Forum
So, RICS has been working with Acclaro Advisory, UKGBC, Arup, Business Services Association and others to capture insight and identify solutions required for a responsible business to operate property assets. This work aims to influence the corporate culture, operational level and interaction with the supply chain to ensure the long-term sustainability of the built environment. See here our opening discussion in the UK, and the finding that we took home from a business leaders roundtable event.
Utilising partners, frameworks, tools and events from across the world, we will look to capture the knowledge, benefits, challenges and risks that will affect the management of property and integrate responsible business practices that will improve society and the environment that we live in.
RICS is calling on strategic thinkers and decision makers across the supply chain who have a desire to embed responsible corporate values in their business, to join the conversation. Together we can deal with challenges and look to shape clear solutions and drive responsible business leadership.
Visit the RICS website and download the RICS Responsible Business Leaders Forum summary report to gain further insight
To get involved in these discussions and for further information on what RICS is doing in this area, contact us or get in touch with Ana Bajri, Property Standards Project Manager, RICS
Article Image : RICS
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