The theme for this year’s Constructing Excellence conference was ‘Delivering Excellence: Better for the Planet, Better for Society, Better for the Bottom Line’. Attendees heard from a range of panelists, and the event was filled with insightful discussions. Some of the key takeaways are set out below. 

Delivering Excellence

In the ever-evolving construction landscape, the Value Toolkit (developed by the Construction Innovation Hub with input from over 200 partners across industry and government) stands out as a pivotal resource and process tool which can help clients and policymakers to make value-based contract and procurement decisions to drive better social, environmental and economic outcomes. This open and free tool is designed to be applied as early as possible in a project lifecycle. By leveraging this resource from the outset, together with frank conversations around the desired outcomes and metrics for measuring them, project teams can test their efficacy and ensure they are on the right track.

Whilst meeting targets is important, aiming higher and keeping an eye on the end goal can drive greater success. This mindset encourages teams to strive for excellence and not simply settle for the minimum requirements. When evaluating value, clients need to consider a broader range of metrics than just cost. Value must also consider wider whole-life considerations including social, economic and environmental factors – and consider them across the full investment lifecycle. A cheaper asset may not necessarily offer the best lifecycle cost nor improve productivity of industry, net-zero or social value. By considering whole-life value at the outset, clients can make more informed decisions that drive better outcomes in design, delivery and operation.

Better for the Planet

Clients play a pivotal role in driving sustainability. When clients demand sustainable practices, it sets a precedent that ripples through the entire industry. Clients need to use the procurement process to put sustainability at the heart of their strategy and include evaluation criteria that looks to flush out, at an early stage, how well contractors and supply chain would manage and enhance sustainability and reduce environmental impact. Clients should be looking to the Construction Playbook and Constructing the Gold Standard (see below) for guidance on best practice in procurement to drive greener construction. 

Industry will be in different states of readiness to meet sustainability goals and if strict environmental targets are made mandatory too early, this could result in excluding all or some (particularly local) suppliers and/or in unbudgeted price increases. It is therefore important to get the balance right. Currently, industry standard contracts like the JCT and NEC include optional clauses that encourage clients to incorporate climate change requirements. The Chancery Lane Project has also produced standard climate change clauses which can be used by any parties to a construction contract. However, these clauses are not mandatory, and supply chains often hesitate to commit to absolute obligations because so much can change – for example, recycled materials not being available/not being appropriate for works. Another example relates to operational energy - should the limit set at day one of the development period be maintained for the whole life cycle of the building? Energy use intensity will be dependent on the user/tenant fit-outs. There’s also the question of what the penalty should be if a target is not met. It could be difficult for a loss to actually be established, and contractors are unlikely to agree LADs for not meeting targets. For now, promoting the use of aspirational targets is a step in the right direction. As sustainability requirements become more standardised, the industry can gradually transition to stricter requirements.

In order for clients to make informed decisions, the industry needs a more robust dataset. Specifying use of BIM or other digital technologies to collate data in an intelligent way to improve sustainability over the whole life of built assets must be something we start seeing as standard. We need to standardise data generation, classification, security and exchange and retain and proactively manage a golden thread of building information (perhaps in the same way that is now required on higher-risk buildings for the purposes of the building safety regime). Ensuring the ongoing sustainability of a building relies to a large extent on users and by integrating the information management systems of clients and supply chain and handing that over to users on completion of construction with clear sustainability-specific user manuals, we’d be off to a good start.

The panel agreed that government policy and legislation is crucial in driving sustainable practices, ensuring everyone is held accountable and that sustainability is not just a choice but a requirement for the industry. 

Better for Society

Transparency is key to building trust within the construction sector. By being open about project outcomes, processes, and challenges, the industry can foster a culture of trust, and accountability. This transparency not only builds confidence among clients and stakeholders but also attracts individuals who value honesty and integrity in their workplace.

Social value initiatives should be a priority for the construction industry - by focusing on projects that benefit communities and contribute to social wellbeing, the industry can demonstrate its commitment to making a positive difference. This approach not only enhances the industry's reputation but also aligns with the values of the next generation.

Better for the Bottom Line

The panel discussed ‘Constructing the Gold Standard’, an independent review of public sector construction frameworks which sets out an integrated and collaborative approach to the procurement, contracting and management of frameworks and framework alliances. As explained in Burges Salmon's previous article which looks at the aims and outcomes of Constructing the Gold Standard, the Constructing the Gold Standard sets out 24 recommendations to help clients identify what questions they should ask when creating and implementing construction frameworks, what answers they should expect and how they can make informed decisions. The goal is to ensure that frameworks drive continuous improvement and the delivery of better, safer, faster and greener project outcomes; that frameworks drive ESG objectives, risk mitigation, collaborative management and responsibility to promote holistic best practices. 

Effective frameworks aggregate demand, approach the marketplace strategically, and create a pipeline of projects. They are more than just a route to market or a call-off system; they streamline administrative processes and encourage collaboration among Tier 1 contractors and key supply chain members. This collaborative approach is essential for maximising the benefits of frameworks beyond cost considerations.

Conclusion

The early application of instruments like the Value Toolkit and Constructing the Gold Standard, prioritising outcomes, promoting holistic value (rather than price), aiming higher, considering whole life costs, and embracing change with a data-driven approach are all essential strategies for maximising project value – for the planet, for society and for the bottom line. 

By integrating the practices outlined in the conference, supported by rigorous verification and active government involvement, the industry can set a new benchmark for constructing excellence.

Burges Salmon’s Built Environment team, consisting of construction and engineering and regulated procurement lawyers, together with specialists in energy and net-zero, technology, employment, pensions and other disciplines, have successfully delivered some of the most challenging requirements in recent years working as ‘one team’ in collaboration with our clients and their other advisers. We can help you navigate key commercial risks and mitigations during tendering, as well as supporting throughout negotiation and delivery. Please do get in touch if you’d like to discuss any of the points set out in this article and how we might be able to assist you.

This article was written by Nia Stewart, Owen Watkins, and Carys Sherwood