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How we use ESG as a framework for the indoor environment

I would like to take up the topic of ESG as it is making the rounds everywhere, and maybe shine a light on it through my own perspective on the indoor environmental quality.

There are a few definitions of ESG (Environmental, Social, and Governance) depending on which viewpoint you have, but generally speaking it is an investing principle for impact investing, for making better returns over time as factors for long term sustainable profits are identifiable as having an Environmental, Social, and Governance aspect.

In our work we can view it as a framework to make sense of why you should invest in the indoor environmental quality. The ESG framework is supposed to take into account all factors of long term sustainable returns, that means every commercial product should strive to touch on at least one category.

Sometimes we stick too strictly to one developed framework by a specific organisation and forget that these have developed somewhat organically over time. ESG in itself is not a complete technical framework, but as mentioned initially, a principle that still leaves some room for interpretation.

In our company, from the very start it has been important to do something which makes a lasting impact on the world. We wanted to work with people who also want to make a difference beyond commercial success. For us, the framework of ESG has always been a natural way to view the impact of our solution on both our customers and adjacent communities.

Air Quality, Facilities, and the Environment

I like to ask the question “why does a building consume energy” and it pretty soon leads to the discussion of thermal comfort and air quality. Energy consumption in most buildings is mainly to maintain breathable air and a fair thermal comfort, so why would we start anywhere other than by determining what the delta is between a good indoor environment and energy efficiency?

I would have a hard time finding a real estate actor not looking to save on energy costs, but it usually starts with the simple question “where can I save energy?” without the more important first step of “what is the optimal temperature I can have in these buildings in terms of both energy and comfort”. Unfortunately we usually have to have quite a long discussion to even arrive at the second question.

What about the answer to that question? 

It depends. Any other answer than that would be too simple, and yes, that other answer is: “21.5°C”.

Otherwise… it depends. Is it a care facility or a school? What is the outdoor temperature? (it matters independent of the indoor temperature or humidity) We can ask those and a few more questions, then apply the PMV/PPD model to get the answer. We can certainly argue about if that model is outdated or not, and I would probably win that debate simply by exhausting you by the fact that I have no strong opinion on the matter.

Rightsizing resources!

Yes, it can be a very complicated matter, and we are only at “E” and touching only on four of the seven factors affecting thermal comfort (bonus points for whoever can say which those are).

The point is, for an environmental impact we need to rightsize resources, we can not just save blindly on energy, and we also should not use personnel resources to make unnecessary adjustments. Data gives us all we need to conserve energy without draining resources.

Can social awareness simply mean well-being?

Social responsibility can mean a lot of things, to someone specialising in indoor environmental quality it means making sure we optimise for people’s health and well-being. 

Air quality in itself is very boring. What it does to our health, collectively, is interesting. What would we trade for an average particulate matter concentration that is just 1µg/m3 lower than our current one? Well, there is math on how much it increases the burden of disease and decreases our disability adjusted life years. In turn, we just have to know what investment is worth it?

Turns out, if you have no idea what the data says in the first place, it does not matter. It also turns out, if you do not have any relative comparison for that data, it also does not matter. All we can really determine with temporary measurements: Is it above World Health Organization or any regional guidelines? Turns out that’s not enough to know if you could save life years though lower ventilation rates… yes, by saving energy, you could decrease particulate matter. But only through actually measuring and analysing.

Governance means a lot of things

You can surely put a rigid and very imaginary set of traffic cones around your well crafted definition of Governance in this context. Meaning: We have followed the law and written our reports.

If you take the yellow vest off for a while and look at the term governance as the overlords at BlackRock intended, good governance could be synonymous with good leadership. We see Governance as part of performance, providing a balance to energy efficiency and well-being by completing it with performance and accountability.

You should report on the indoor air quality regularly, you should give access to the data widely enough to specific stakeholders (maintenance, property management) and you should focus on the indoor environmental quality being as productive as possible, in addition to being healthy and environmentally friendly.

In the end ESG is not just about compliance, but about creating a holistic approach that benefits people, the planet, and business.

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