Analyst Reports
Environmental. Social. Governance. These three words combine to form a powerful concept (ESG) that has been buzzing through the corporate world. Many companies now produce ESG reports to tout the steps they are taking to promote environmental and societal improvements. And there are countless seminars, conferences, webinars and podcasts that focus on how to gain value from contributing to a sustainable, equitable and just future. In all of these settings, it’s the ‘E’ and the ‘S’ that get the most attention. That’s natural; they are the elements that drive improvement initiatives. But it’s the ‘G’ that may be the most important in actually making progress.
Governance is not a particularly sexy concept. It’s about setting rules, following processes, adhering to standards, and ensuring accountability: The things we strain against when we are aiming for innovation. But working within constraints often provides an ideal framework for innovation – those boundaries of governance ensure that we maintain structure and coherence in our efforts to do something new, so that those efforts can be comparable or repeatable.
Information systems provide the kinds of rules, processes and standards I am talking about. Not surprisingly, I’m thinking of Integrated Workplace Management Systems (IWMS) here. I want to suggest that an IWMS provides just the sort of framework that is needed to generate the best results from sustainability improvement efforts.
Why would that be so? IWMS systems are, among many things, tools of data governance. An IWMS will structure data (the database), ensure its integrity (data entry constraints), control its use and transformation (workflow) and as a result will yield consistent, accurate results (business intelligence). When organisations invest in IWMS systems, it is often those very qualities they are looking for in order to bring order to a scattered, disorganised operation.
The data typically collected and managed in an IWMS – physical, operational and financial details about buildings, spaces, assets, equipment, disposables, organisational units and people – are the very elements that would form the basis of any sustainability improvement effort. The fact that many organisations use an IWMS to ensure that this data is accurate, up-to-date and well-maintained, gives them a natural head start in making the kinds of improvements that we look for in sustainability initiatives.
To cite a simple example: A properly maintained air handler will run more efficiently and consume less energy than a poorly maintained unit that struggles to meet performance expectations. That’s a well-documented outcome that manufacturers as well as consumers have proven many times over. It’s also likely that a well-maintained unit will generate less heat, emit fewer harmful by-products, make less noise and run less risk of failure. All of these valuable outcomes are the goals of a well-run maintenance system, one of the key aspects of an IWMS. And it allows organisations to shift from purely reactive maintenance strategies to more effective preventive maintenance ones.
Similarly, organisations know that they are likely to have a smaller impact on the environment if they optimise their building operations, manage space requirements, and keep a real estate portfolio that matches their needs, is optimally occupied, and doesn’t require them to condition and service interior space that is marginally occupied and underutilised. Again, an IWMS allows an organisation to keep on top of its requirements and adjust the portfolio to match needs through carefully tracking maintenance, occupancy, utilisation, leasing options, etc. Processes like long-term planning, fleet management, move management, short-term space reservations and more provide avenues for organisations to monitor and improve the efficiency of their real estate portfolios and operations, which will have a direct impact on their environmental footprint.
Getting back to the original point, these are examples of the governance that is enabled through use of an IWMS. The IWMS provides an effective way to manage the data, enforce adherence to processes, and maintain standards of quality as well as operational excellence. In doing this, it also provides the necessary setting for establishing and executing improvement projects. For some organisations, it may be ambition enough to get all of their building equipment on a solid maintenance programme that results in a reduced environmental impact. Other organisations, that have already accomplished that, may set their sights on a systematic upgrade of equipment and building envelope to higher sustainability standards.
Whatever stage an organisation is at in monitoring its environmental impact, an IWMS can participate, in terms of understanding current performance, setting improvements goals, and then achieving them. The nature of an IWMS is to capture process and performance data. In cases like those described above, the effort may be packaged as ‘efficiency’ and ‘cost-savings’ rather than environmental impact, but ESG improvements come naturally as a result.
We tend to think of IWMS as operational systems rather than governance systems, but it is important to remember that the two concepts are intimately related. When we talk about ‘measurable results’ – a common theme in IWMS – we are talking about governance. The ‘G’ in ESG is a fundamental element in the use of an IWMS – and a great conversation starter for those looking to align their organisational goals around sustainability initiatives and facilities operations.
