Monday, December 25, 2006

Making Money with Green Design

It was good to see financial publications publishing articles about sustainability and pointing out that green buildings are good for Corporate America. I congratulate Barron's for publishing an article by Charles Lockwood in Dec. 25, 2006 issue ( page 37). This is a well written article stating facts and dispelling the misinformation that green buildings cost more. The truth is that they cost less over the life time of the structure and will hold investment value.

Imagine the majority of real estate holders with old building concerned about future value of their investment when newer buildings are GREEN and customers prefer them. The choice is very simple. Rehabilitate the old buildings and make them as Green as practical. Energy cost reduction will bring immediate benefit to the owners and occupants, and the value will be retained.

Helping fight the global warming and control the climate change are added benefits.

Saturday, December 23, 2006

Green buildings enhance ROI on Human Capital

It is well known that human capital or " people" in any organization are key to its success and can provide critical competitive edge for sustainability and growth.

I recently read an article describing the importance of this fact and suggesting a multi dimension role for Human Resources (HR) departments including; training, risk management,productivity enhancement,and routine benefit management. This article made me think about the relationship of Facilities with "people" or Human Capital. How does a green building relate to corporate bottom line? How the buildings where we work or shop or learn help enhance our performance or productivity?

The secret lies in the fact that we are humans and have natural intelligences and our thoughts and actions are affected by our environment. Think about our jails where we put criminals. The worst ones are kept in solitary confinement where a small dark room is what they get for their deed as punishment. Obviously such an environment is used to punish them and the offer to be able to live in a room with windows and other people is a reward for good behavior. Such conditions are not limited to jails. Unfortunately we have normal work conditions for many workers who work in windowless basement office cubicles and the management expects great results. Give these folks a naturally lit room and connectivity to nature and then do not be surprised if they start performing better. Our sense when exposed to nature inspires us subconsciously, we feel better and then we perform better.

This is what a green building creates for people in office buildings, shopping centers, and class rooms. Any living organism needs the natural healthy environment to grow as we observe plants near the windows versus the location with no natural light. So should we build the cheapest building or factory, office building, schools and shopping centers with no regard to the most precious content - "The Human Capital"? Green buildings do not cost more over the life cycle of the facility. They save money with lower operating costs and increased productivity which directly benefits the bottom line.

In summary, there is a very important link to the space where we live, work or do other functions affecting our performance. The leaders managing the public and private organizations should follow the examples of companies such as Toyota, Wal-Mart, GE, PNC Bank, and Herman Miller. These companies have adopted a sustainable green philosophy to reduce their energy costs and help in environmental preservation. These efforts also resulted in giving the best possible environment to their people and increasing the profits. Similarly, college campuses at Univ. of Maryland, Harvard, Stanford, and Yale are also leading the way in using green buildings to reduce life cycle costs and have also observed the added benefit of improving learning and student satisfaction.

Every organization wants positive results and their leaders must understand the relationship of the building envelop with performance of people occupying the space. The most valuable benefit is to help fight global warming and control climate change with an added bonus of achieving higher return from the investment in Human Capital.