Green buildings are better for business

Sustainable green buildings are not only good, better for people, reduce 30% of greenhouse gas emissions at no net cost but are also a very good business opportunity.

Historically, business drivers for sustainable buildings was to lower cost but research has shown that the value of green buildings have been underestimated.

Business Drivers

  • LOW VALUE: Lower costs from energy and resources both in construction and ongoing maintenance
  • MEDIUM VALUE: Brand value from corporate social responsibility agenda
  • HIGH VALUE: Better health and productivity from good indoor environment quality

Benefits for commercial business

Higher property value and rental premiums for sustainable buildings

  • 5 star NABERS delivers 9% green premium value and 3-4.5 star only delivers 2-3% (Australian Property Institute)
  • Major discounts in value for less than 3 star NABERS for Sydney CBD (10%) and Canberra (13%)
  • 5 star NABERS showed green premium in rents (3%), while major discounts in rents for lower NABERS energy ratings – 9% in Sydney CBD
  • Optimise life cycle economic performance

Higher productivity and health benefits for sustainable buildings

  • Gains estimated for Australia at $12 billion (CSIRO) and up to $235 billion in USA
  • Boost productivity by up to 15%
  • Enhance occupant comfort and health – improve quality of life
  • Heighten aesthetic qualities

Reduction in business costs for sustainable buildings

  • Tangible cost savings from reduced sick leave and insurance premiums
  • Intangible benefits such as improved employee attitude, staff loyalty, high performance culture and reduction in distractions
  • Externalities such as reduced general health care and burden on the public health system
  • Consume up to less energy than the average commercial building
  • Consume less potable water than buildings built to meet minimum industry requirements
  • Reduce risk and ‘future proof’ investments
  • According to CCH Australia, a leading publisher of human resources and industrial relations publications, unscheduled worker absences cost Australian businesses $7 billion a year. After moving into their green office, the legal firm at the 5 Star Green Star rated 500 Collins Street in Melbourne reduced their sick leave by 39% – well below the national average. Sick leave costs fell by 44%.

Demonstrating Corporate Social Responsibility

  • Deliver a competitive edge in a crowed marketplace
  • Produce 62% fewer greenhouse gas emissions than average Australian buildings (GBCA)
  • Good for the environment, good for business. Green initiatives “are good for customers, good for the environment and good business” as it enhances corporate branding and prestige. Operating from green facilities can attract new customers.
  • Create, expand, and shape markets for green product and services
  • Enhance and protect biodiversity and ecosystems
  • Improve air quality and water quality
  • Reduce waste
  • Conserve and restore natural resources


  • Speed up recovery time for hospital patients
  • Green schools are also more productive and engaging places to work and learn. The Heschong Mahone Daylighting Study(1999) of more than 21,000 US students found a dramatic correlation between daylit school environments and student performance, including: (GBCA)
    • 20% faster progression in maths
    • 26% faster progression in reading
    • Up to 10% increased performance simply


There may be trade-offs between healthy buildings and costs. For example, ventilation conflicts with energy efficiency. Hence, the goal is to optimise buildings across an integrated bottom line, covering worker amenity, environmental, economic, technical and staff motivational issues. Try to use common sense to balance the trade-offs. Countless examples of the benefits derived from businesses in achieving social and environmental goals that have resulted in a sustainable financial return on businesses’ investment.


Measuring productivity and indoor environment quality  

  • Qualitative: Pre- and post- staff questionnaires, perceptions of work, serious illness, stress, concentration levels, work relationships and self-assessed productivity
  • Quantitative: Keyboard typing speed, business metrics, leave records, absenteeism, general motivation and staff morale
  • Physical: Air quality, lighting, thermal comfort, humidity, ambient temperature, carbon dioxide levels

Generally, there is a good correlation between improvements in thermal comfort, air quality and lighting matched staff perceptions. Giving individuals as much control of their micro-environment as possible. The indoor environment is linked to ‘getting the best out of staff and resources’.


Case Study – Green Star

The Value of Green Star: A decade of environmental benefits report analysed data from 428 Green Star-rated buildings and fit outs. The report compares data from the Green Star-rated buildings with minimum practice benchmarks. Green Star-rated buildings produce around a third of the emissions and use about a third of the electricity compared to the average Australian building, according to a new report by the Green Building Council of Australia.

The impact of Green Star on greenhouse gas emissions, operational energy and water consumption, and construction and demolition waste has been found to include:

  • On average, Green Star-rated buildings produce 62% fewer greenhouse gas emissions and use 66% less electricity than average’ Australian buildings.
  • Green Star-rated buildings produce 45% fewer greenhouse gas emissions and consume 50 percent less electricity than new buildings designed and constructed to meet construction code requirements.
  • Up to 51% less potable water than buildings built to meet minimum industry requirements (GBCA)
  • Together, the 428 Green Star-rated buildings in the study have reduced electricity consumption by 580,000 megawatt hours or 2,088,00 gigajoules per annum.
  • The cumulative greenhouse gas savings from the Green Star-rated buildings surveyed, when compared to the average, totals 625,000 tonnes of carbon dioxide per annum.

Example of Green Star Building: Melbourne Convention Centre



Source: Australian Property Institute ‘Building Better Returns Report, GBCA ‘Why choose Green Star’

One thought on “Green buildings are better for business

  1. Pingback: Indoor Environment Quality | Energy Systems & Sustainable Living

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