May 20, 2010

Construction companies not adapting to climate change: University of Western Ontario study

PETER KENTER

correspondent

While many Canadian construction companies are mindful of reducing their environmental footprint, few are making efforts to adapt their businesses to climate change itself.

That’s the conclusion of Business Adaptation to Climate Change, a sector-by-sector study commissioned by the University of Western Ontario’s Network for Business Sustainability.

The study was conducted by David Nitkin, President of EthicScan Canada Ltd., a Canadian-based consultancy specializing in corporate ethics, and two researchers from York University.

“What we learned from looking at the literature of these companies is that in many cases they have a conviction that they need to change the way they are operating, but they often seem to confuse climate mitigation through reduction in greenhouse gas emissions, with adaptation to climate change,” says Nitkin. “Companies in the sector have low perceived vulnerability to climate change, despite the exposure and risks the sector will face. Forget about whether you believe that human activity is changing the climate. This study looks at how businesses are adapting to the climate.

What are the strategies that will help your construction company adapt to 100-year storm events if they now occur every two years? What effect will future climate have on a building designed to last up to 100 years?”

Nitkin notes that if the world’s climate changes significantly, then Canada is the country most likely to be affected by it. While some sectors, such as agriculture, might benefit from a warmer climate, the construction sector would see few explicit opportunities beyond a longer building season in northern climates, and a potential abundance of retrofitting projects designed to meet either energy efficiency regulations or new hazard codes.

However, companies who ignore climate change may find themselves losing competitive advantage to those who are. Looking ahead can also be advantageous to smaller companies who may not have the financial capacity to change their business models on short notice.

“We have some construction companies reporting on winter roads that serve native communities, mining projects and oil developments,” says Nitkin. “Where the permafrost is melting we have reports of equipment getting stranded or sinking into bogs. Will your company be better off delivering construction materials or equipment through the elusive Northwest Passage instead?”

Nitkin says that companies can either ignore climate change, take a “wait and see attitude” and monitor various geographies and business sectors to see if there’s any business impact, or act to adapt. That can be a little more daunting for the construction sector, which is often driven by government regulations and building codes. While some construction companies have stepped up to the plate, the sector as a whole lags behind such early adapters as the insurance sector, which has rapidly accommodated its business to changing climate patterns.

Adaptation strategies in the construction sector include risk avoidance, redesign, and technological developments. For example, avoiding construction in high-risk areas such as flood plains, or changing building locations will minimize the risks future projects might face as climate changes.

Redesign measures include accounting for flood risks, and building flood-proof foundations, integrating natural defenses into site design, and specifying building materials for warmer weather. Technological developments in energy efficiency, new windstorm resistant roofing, and improved supply chain management, for example, may also protect the sector from some of these risks.

Nitkin notes that there’s no magic strategy that will help companies to adapt.

“Nobody will be able to look back from the year 2031 and say that a construction company in 2011 absolutely did the right thing,” he says. “But the way in which a business behaves matters, and those who are diligent are more likely to profit.”

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