The World Economic Forum publishes an annual report of global economic risks designed for government officials, entrepreneurs, and CEOs of multinational companies. According to the current report, challenges confronting business mirror those confronting society—inflation, debt, cyber attacks, supply chain disruptions caused by war, climate transition disorder, and skills shortfalls, to name a few. What does this mean for architects/designers, their clients, and the built environment?
For most companies, economic activity has classically focused on increased production and cost-cutting—knowingly or unknowingly at the expense of environmental and labor standards. Although lucrative, this approach has generated unintended consequences, including resource depletion, waste generation, and increased CO2 released into the atmosphere, while creating multiple inequalities, all problems now challenging society. Through the years, architects and designers have contributed to this scheme and its risks to support client needs and further corporate growth.
In terms of waste generation, pollution, and ecosystem disruption, we now know that the construction industry imposes the greatest environmental and social impact on our planet, with construction contributing nearly 50% of annual global CO2 emissions. Greater awareness of this outsized impact, along with changing legislation, is driving a new approach focused on balancing growth with social and environmental responsibility. In some US cities, for example, at the risk of incurring massive financial penalties, buildings must achieve a 40% reduction in greenhouse emissions by 2030 (60% in the EU), with an 80% reduction by 2050.
To protect themselves against future penalties and volatility, companies must understand that their decisions impact countries, governments, cities, communities, and the environment. In terms of their real estate portfolios, this imperative is compelling a fundamental shift in the selection and use of materials, energy sources, and construction technology.
Traditionally, architects develop projects based on a client brief (or, in LEED parlance, an Owner’s Project Requirements ), which defines client needs and envisions successful outcomes. From project concept to completion, architects use that brief, which is now more important than ever, to design innovative and flexible spaces that meet client and board members’ expectations.
Today, the architect/design professional must also account for the environmental and social impact of a building’s development. Recycled materials and sustainable building systems and construction methods have to be used with an understanding of their impact on design and detailing. Coordination with planning authorities, citizen and city officials, and possibly landscape architects, transportation engineers, and parks and recreation officials, as well as community stakeholders, is critical.
Future planning legislation, the increased costs of virgin materials, supply-side difficulties, plus operational building costs and their relationship to meeting companies’ Environmental, Social and Governance (ESG) policies must be taken into account. A multifaceted approach is required to guide and facilitate complex projects that are not only profitable but benefit human occupancy, support wellbeing, and project a strong sense of local identity.
Although clients may not know exactly what their project requirements entail and lack a fully developed vision, they traditionally consider architects/designers best placed to communicate and lead a design that will achieve the desired outcomes. Yet a report by the Royal Institute of British Architects (RIBA) on 500 client relationships showed that architects need to listen more to client needs and increasingly collaborate with stakeholders throughout the project process to ensure outcomes provide real returns with respect to financials and company reputation. In essence, by providing comprehensive advice coordinated with multiple stakeholders, architects and designers must empower clients to make informed decisions throughout the project process.
How to reckon with the full range of stakeholders presents a challenge for clients and architect/design professionals. Furthermore, to create long-term value and compete in a changing global economy clients must focus on sustainability which is particularly important during economic downturns when resilience is a matter of maintaining performance and reputation.
A 15-year Kinsey Global Institute Study of 615 large and medium-sized companies concluded that organizations with a long-term view outperformed competitors in earnings, revenue, investment, and job growth. Corporations frame this as “Stakeholder Capitalism,” with long-term value oriented towards shareholders, customers, suppliers, employees, communities, and the environment. Value in this context means the creation of safe and healthy work environments, limiting the costs caused by high staff turnover, and improvement in employee productivity, a result of nurturing wellbeing, providing security, and inspiring loyalty. Within an organization, architects can support these objectives, designing spaces that support long-term health, psychological wellbeing, and include access to nature.
While providing for employees, workspaces can also offer positive opportunities and outcomes for the local community, contributing to a transparent company culture that is open-minded and able to adjust to new opportunities. A strong connection with broad societal factors builds resilience into the business model. Focusing only on stakeholder agendas to achieve earnings targets corrodes these values. And there is considerable overlap with community concerns since a project’s design must account for the company’s waste management, carbon footprint, land use, and consumption of natural resources.
If the scope of the brief integrates the needs of the client, building users, and operators, as well as an understanding of how the community will benefit or bear the cost of waste generated by the building during its operation and at the end of its useful life, then the brief should meet client expectations, informing the architect/designer. To this end, working with all stakeholders is critical to ensuring their values are defined and translated into physical form, achieving the organization’s vision/goals in line with sustainability objectives and benefiting the community.
Identifying who the stakeholders are, how they define value, and how to ensure engagement between all parties means the process of stakeholder engagement begins well before pen is put to paper. Broadly, stakeholders fall into three categories: internal, external, and operations.
Internal stakeholders are employees, executives, the management board, and shareholders. This group is usually appointed by the client to ensure a balance of frontline and executive staff representation. Within this group it is important to note position and differences in age, gender, and ethnicity.
The second group are not employees but rather customers, suppliers, and investors. They buy the company’s products, meet its sustainability goals, and communicate confidence to industries and markets. An effective Environmental, Social, and Governance (ESG) policy will extend to primary suppliers as well as their subcontractors to ensure targets for sustainability are met, workers’ health and safety are considered, and supplier operations can decarbonized.
Finally, there are the outside entities responsible for affecting the company’s operations that include governments and local communities, as well as the natural environment required for needed materials and services. Operationally, a company’s globally consistent sustainability strategy can avoid the risk of regional regulatory changes (which may compromise up to a third of corporate profits). Investment and asset optimization in renewables, waste reduction, water use, and CO2 emissions will limit dependency on fossil fuels and the risk of unstable supplies and increasing energy costs.
Hosting a charette will allow architects/designers to leverage their position and knowledge, but more importantly to understand and account for the broad range of client-relevant stakeholder’s concerns that will affect the best outcomes.
Defined by a brief and with clear expectations of outcomes, a project starts to come alive.a
For core and shell projects, this requires understanding and accounting for the building site and design in terms of environmental impact (avoiding greenfield sites, land that has never been developed or built up), energy reduction potential, and maximum opportunities for natural sunlight. For interior fit-out projects this means surveying existing site conditions to consider reuse or sourcing repurposed recycled materials and the use of technology to reduce heating and cooling loads.
In this regard, major advances in energy-efficient technology must be deployed to reduce energy needs, especially during peak demand. From air quality sensors to delivering fresh air for meeting spaces only when needed, to networked ground-source heat pumps to utilizing energy-efficient geothermal energy—each location needs to exploit alternative locally available energy sources.
Any transition from the use of fossil fuel combustion in buildings would bring added social value, namely improved air quality and health benefits for local communities. Using technology to record these savings allows clients to communicate that message internally and externally and might avoid the need for carbon offsetting.
At various project phases, architects will want to return to the stakeholders, communicate the benefits of the design, verify their mandate from stakeholders and community leaders, and make sure suppliers understand their responsibilities in delivering against the project’s vision. For consistency of understanding and response, analytics tools offering a project specific or longer-term metric to assess project success will enable stakeholder engagement on a large scale more efficiently than relying on the conflicting schedules of face-to-face meetings. Such tools can include dashboards (a simple interface that enables stakeholders to monitor changes over time) or interactive formats that present a snapshot in time, for example, responses at different project phases or satisfaction surveys. With multiple stakeholders, these conveniences encourage audiences to click into individual data points and respond, providing a broader review of project success.
By gauging the social and environmental impact of a project against information provided by a wide range of stakeholders, companies will have a better baseline for creating successful outcomes, framed by an understanding of how various elements can translate into operational practices that are sustainable, human-centric, and profitable. In this scenario, the brief takes on new meaning as a highly defined roadmap that brings together all the sensitive and seemingly divergent needs of multiple agendas.
The emerging role of the modern architect is now intensely multifaceted. By engaging and mediating between stakeholders to establish goals, leveraging developments in technology to communicate project objectives and outcomes, and connecting sustainably with local ecosystems to reduce dependence on fossil fuels, architects and designers will help clients realize built environments that are productive, socially successful, and environmentally responsible.