SUSTAINABILITY

Sustainability

Sustainability

Corporate Governance is the use of specific social and environmental criteria, in addition to traditional financial criteria, to make investment decisions. Most Corporate Governance is done by mutual funds and institutional investors who buy and sell shares of publicly traded corporations. In the past, Corporate Governance has generally been about avoiding undesirable sectors such as tobacco, nuclear power, gambling, etc. This is called negative screening in Corporate Governance. But in the last few years Corporate Governance has changed to a positive approach of looking for the best practices among competitors. Corporate Governance funds that use positive screening have criteria for Sustainability or Corporate Social Responsibility (CSR), a more traditional term) to evaluate companies. These Sustainability / CSR criteria cover a wide range of topics, including health and safety, corporate governance, pollution prevention, labor relations, indigeneous peoples and more.

The Corporate Governance market has become quite developed. There are market indexes that list “responsible” or “sustainable” companies, and numerous research firms selling information about sustainability of various companies. Their customers include a full range of financial market institutions, and they are all supported by information providers and advocacy groups. Figure 1 shows the structure of the Corporate Governance market.

Competencies and Opportunities

The concept of capabilities is not new. Experts coined the notion of distinctive competence as "the capacity of the firm to better allocate and use resources to gain economic rent." Capabilities are considered to be complex bundles of skills and accumulated knowledge exercised through organizational processes that enable firms to coordinate activities and make use of their assets. Experts indicated that capabilities are formed through the coordination and integration of activities and processes, and are the product of the collective learning of individual assets. They define capabilities as "the ability to make use of resources to perform some task or activity."

The core competence or core capability of a firm is the firm-specific knowledge system that exerts competitive advantage, which may pertain to a knowledge base, a technological system, a managerial system, and/or a norm and value system. In addition, capabilities are characterized by significant barriers to duplication, whether these are in the tacitness inherent in the skills of individuals or groups or in the complexity and specificity of organizational routines. Expertsdicated that capabilities are an important source of advantage.

Opportunities

It is not always possible to fully accommodate sustainability measures in buildings, whether it is for lack of willingness on the part of clients, or an inability to reliably integrate proposed designs in a workable fashion. There remain a number of opportunities to cost-effectively lessen the environmental impacts of building while improving the health and well being of the occupants, and their community. In order to realize these opportunities, it is necessary to acknowledge the value of design versus the application of building conventions.

"Factoring all this in we found that in the U.K., engineers have three times as many hours to design than they do in the U.S. In the U.K., people have more time to do research while they're practising, which ...