In Ireland, there is growing pressure on the construction industry to operate in a sustainable way to ensure net zero targets are met.

This pressure is linked, as highlighted by a KPMG report, to the fact that the construction industry in Ireland has a high carbon footprint and lags behind many other sectors when it comes to embracing many aspects of environmental, social and governance, making it a laggard on ESG.

With Project Ireland 2040 and EU reporting requirements such as the Corporate Sustainability Reporting Directive (CSRD) starting to push companies to consider sustainability through circular, low carbon projects, energy and resource efficiency, and social impact, the need to reconsider their operations and start making changes its unavoidable for construction companies.

However, this is easier said than done! This blog explores some of the challenges associated with ESG considerations for construction companies and also the practices they can adopt to make the transition easier.

Waste regulations

Excavated soil and stone accounts for approximately 80% of construction waste, representing a significant cost and lost value for the industry, which could be avoided.

The EEA have identified the main challenges that construction companies face when attempting to implement circularity:

1. New materials tend to be cheaper than secondary materials
2. There’s a lack of confidence in secondary materials
3. Secondary materials can contain hazardous substances
4. There’s a lack of sufficient data for decision-making
5. There can be a time delay between implementing circular initiatives and reaping the benefits

With these challenges in mind, The Waste Action Plan for a Circular Economy was developed as Ireland’s new roadmap for waste planning and management. This document outlines the steps businesses must start taking to rethink waste and create a circular economy in Ireland. For construction companies, the main priorities are:

Streamlining by-product notification and end-of-waste decision making processes. This means that contractors can more easily and quickly notify authorities about materials that should be classified as by-products rather than waste. However, it also requires conditions to be met by which a material that is recovered or recycled from waste can be classified as ‘no longer waste’, to ensure the material is intended for specific purposes.

Revision of the 2006 best practice guidelines for waste. The updated version was published in 2021, you can read it here.

Forming a working group to develop national end-of-waste applications for priority waste streams. This would involve a broad range of sectors to guide strategic thinking and decision making, in preparation for the next national waste policy that addresses challenges experienced across sectors.

Read our blog on waste and the risks of non-compliance here.

Emissions

‘Nearly Zero Energy Buildings (NZEB) are buildings that have a very high energy performance with the low amount of energy required provided largely from renewable sources. This includes renewably-sourced energy produced on site or nearby.

However, the EU Commission has proposed to revise the directive aligning energy performance requirement for new buildings to the longer term climate goals. This new proposal outlines the requirement for ‘Zero Emissions Buildings (ZEB), defined as having the very low amount of energy required fully covered by energy from renewable sources.

The ZEB requirement should apply as of 1^st January 2030 to all new buildings, and from 1^st January 2027 to all new buildings occupied or owned by public authorities.

Although the implementation dates of 2027 and 2030 for the Zero Emissions Buildings (ZEB) requirement may seem distant, it's crucial for construction companies to recognise that project timelines often span a number of years. Consequently, if you are involved in public sector projects, careful considerations must be made now regarding the ZEB directive to guarantee compliance with the 2027/2030 deadlines.

Read our blog on considering net zero in construction contracts here.

Social Value

With CSRD, many large and listed SMEs are required to report and disclose on their social value including issues such as human rights, equality, diversity and inclusion and community impacts.

Ultimately, construction companies will need to engage with and report on their social value to comply with these regulations. This may be a new area for some construction companies, so understanding the data you’ll need to collect to evidence your social value and how you can do that could be a challenge. It’s one many SustainIQ clients have asked for help with in the past.

Read about our client JP Corry and how they used SustainIQ to track community investment here.

We also have a blog on the importance of social value in winning work for construction companies which you can read here.

How can SustainIQ help address these challenges?

Implementing an ESG reporting software such as SustainIQ, can play a crucial role in helping construction companies address the challenges associated with sustainable practices and compliance.

For waste management you can track waste materials and their end of life use, you can track all your emissions data to ensure compliance with NZEB and ZEB, and for social value you can track both internal and external data on people associated with the business,

By having all your data on one centralised platform, it will allow you to track waste materials, and how they are disposed of, emissions data for projects and social value data. This along with the 150+ other different reporting categories, makes software such as SustainIQ, a valuable tool in simplifying the ESG reporting process for construction companies.

Why not request a demo to see how it could work for you?