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The social impact of the built environment The built environment is responsible for 37% of global carbon emissions, representing a huge sectoral contribution to climate change. 2 Whilst often considered a purely environmental challenge, the climate crisis that we face is also, inherently, a social challenge too – already affecting 85% of the world’s population. 3 The definition of sustainability, and the corresponding growth of the environmental, social and governance (ESG) movement, is fundamentally balanced around the nexus of environmental and social priorities. Sustainable development cannot be achieved without focusing on social impact. In the past decade we have seen sustainability move increasingly into the mainstream, with over 90% of S&P 500 companies now publishing ESG reports on an annual basis. 4 The European Union’s Corporate Sustainability Reporting Directive (CSRD) has extended the ESG requirements for organisations’ sustainability reporting – both in breadth of requirements and eligibility of compliance. 5 Despite this significant development, there remains a notable deficit in prioritising the social aspect of sustainability – or the ‘S’ in ESG – meaning that action to improve the human rights and experience of people is not being pursued in an aligned and impactful manner. 6,7 Our built environment generates social impacts across a broad spectrum of areas which can significantly influence the quality of life, health and opportunities available to individuals and communities. The green buildings industry alone offers huge socio-economic opportunity – representing nearly $25 trillion of investment potential by 2030. Additionally, the sector is a source of employment for 7% of the world’s population so has substantial responsibility, with both economic and social implications, on the lives of many millions of people. 8 Climate and wider system stresses are experienced by people within their own homes, communities and cities. 9 For example, with over 970 cities expected to experience the effects of extreme heat by 2050, social issues around health and human rights must be a major factor of the resilience and adaptation measures. 10 Equally, it is important to not only focus on ‘creating’ social impact, but rather to recognise and uphold the social value, equity and justice that may already exist in communities. 4 Social Impact across the Built Environment 4
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Defining social impact for the built environment In recent years, the topic of social sustainability has rightly received increased attention within the building and construction sector with particular prevalence towards the themes of social equity and justice across the development life cycle. In this position paper, these themes have been incorporated within the broader ‘umbrella’ term of social impacts, which must also be considered in alignment with environmental justice. Action to improve the human rights and experience of people is not being pursued in an aligned and impactful manner Definitions of social sustainability terminology, as it relates to the built environment sector: Social impact: The effects of built environment-related action or activity on people and communities, which can be positive or negative. Social value: A cumulative benefit of all social impacts from the built environment to individuals, communities and businesses, measured through added financial and wider non-financial metrics. Social equity: Recognising that each person has different circumstances and providing the equitable access for all people to resources and opportunities and full participation in the social and cultural life, regardless of background. Social justice: The pursuit of a system that recognises fairness for all, in which everyone deserves equal economic, political and social rights and opportunities. Measuring social impact against human rights outcomes can provide a clear and tangible framework. Encompassing this full scope of social impact is key to making environmental sustainability efforts more effective and inclusive as it contributes to the realisation of human rights, ensuring a more just, resilient, and climate-positive future for all that ‘leaves no one behind’. Through this work, WorldGBC aims to increase awareness of the responsibility and accountability of the sector to reduce negative social impacts at all stages of the building and construction life cycle – and consequently increase engagement, reporting and action around the ‘S’ in ESG. 5
