Master’s Programme in Real Estate Economics
Elements of Social Sustainability in Real Estate
Case: Multi-User Business Campus Saara Raitaranta
Master’s Thesis 2021
Copyright ©2021 Saara Raitaranta
Aalto University, P.O. BOX 11000, 00076 AALTO www.aalto.fi Abstract of master's thesis
AuthorSaara Raitaranta
Title of thesis Elements of Social Sustainability in Real Estate – Case: Multi-User Business Campus
Master programme Real Estate Economics CodeENG24
Thesis supervisor Assistant professor, D.Sc. (Tech.) Saija Toivonen Thesis advisor(s) M.Sc. (Tech.) Atte Köykkä
Date 18.04.2021 Number of pages 100+8 Language English
Abstract
Sustainable development is a global megatrend. The built environment contributes significantly to all aspects of sustainability, which makes it one of the globally most potential sectors in achieving goals of sustainable development. Sustainability in the field of real estate has previously been researched especially considering the aspect of environmental sustainability. In recent years, research has also been concentrating on the social sustainability aspects. Previous research shows a lack of comprehensive and inclusive understanding of social sustainability in the field of real estate between different stakeholders. Researching and understanding different stakeholders’ views and preferences of social sustainability enables further commitment towards social sustainability measures from all stakeholders, which is important in order to achieve social sustainability in the long run.
The overall aim of this thesis is to gain understanding of the social sustainability preferences, needs and priorities of different stakeholders regarding commercial properties.
In order to achieve this, existing literature about social sustainability in different branches of real estate is reviewed and a framework for assessing the social sustainability of a commercial property is created. The created framework is then tested by conducting a case study where users and service providers of a multi-user business campus participate on a social sustainability survey formed based on the framework. The data from the surveys is analysed in order to determine which aspects of social sustainability are most important to different stakeholders and demographics. The survey results are also analysed in order to gain knowledge of how well different social sustainability factors are realised within the business campus studied in the case study.
The results show a significant weight being given to health, safety and well-being related as well as equity related social sustainability indicators. This can be seen both in existing literature and in the case study. The case study shows that the most important factors are also the ones that tend to be seen as being inadequately realised according to the users of the property. Overall, the thesis provides an overview on the social sustainability views of different demographics of users and service providers in an in-use commercial property.
This will hopefully enable further commitment towards social sustainability in the future.
Keywords social sustainability, sustainability assessment, real estate, commercial property, office
Aalto-yliopisto, PL 11000, 00076 AALTO www.aalto.fi Diplomityön tiivistelmä
TekijäSaara Raitaranta
Työn nimiSosiaalisen kestävyyden elementit kiinteistöissä – tapaus: usean käyttäjän yrityskampus
MaisteriohjelmaReal Estate Economics KoodiENG24
Työn valvoja Apulaisprofessori, tekniikan tohtori Saija Toivonen Työn ohjaaja(t) Diplomi-insinööri Atte Köykkä
Päivämäärä 18.04.2021 Sivumäärä 100+8 Kieli englanti Tiivistelmä
Kestävä kehitys on maailmanlaajuinen megatrendi, johon rakennetun ympäristön ja kiinteistöjen vaikutus on merkittävä. Siksi kiinteistöala on yksi merkittävimmistä mahdollisista kehityskohteista kestävän kehityksen saralla. Kiinteistöalalla on aiemmin tutkittu kestävyyttä erityisesti ympäristönäkökulmasta, mutta viime aikoina on alettu tutkia myös sosiaalista kestävyyttä kiinteistöissä. Olemassa olevat tutkimukset nostavat esiin puutteita sosiaalisen kestävyyden kattavassa ja yhtenäisessä määrittelyssä kiinteistöalan eri sidosryhmien välillä. Jotta kaikki sidosryhmät saadaan sitoutettua sosiaalisesti kestävän kehityksen tavoitteisiin, on tarpeellista tutkia eri tahojen näkemyksiä ja preferenssejä aiheesta. Kaikkien sidosryhmien sitouttaminen yhteisiin tavoitteisiin on tärkeää, jotta todellista sosiaalista kestävyyttä voidaan saavuttaa tulevaisuudessa.
Tämän diplomityön tavoite on perehtyä yrityskampuksella toimivien sidosryhmien preferensseihin ja näkemyksiin sosiaalisesta kestävyydestä. Tavoite saavutetaan perehtymällä olemassa oleviin tutkimuksiin, jotka käsittelevät sosiaalista kestävyyttä eri kiinteistöliiketoiminnan osa-alueilla. Kirjallisuuskatsauksen perusteella kootaan viitekehys sosiaalisen kestävyyden arviointiin toimitilakiinteistöissä. Viitekehystä testataan toteuttamalla tapaustutkimus, jossa yrityskampuksen käyttäjät ja palveluntuottajat vastaavat viitekehyksen perusteella koottuun kyselyyn. Kyselytutkimuksen tuloksia analysoidaan pyrkimyksenä selvittää, mitkä sosiaalisen kestävyyden osa-alueet ovat tärkeitä käyttäjien ja palveluntuottajien eri demografisille ryhmille. Lisäksi kyselytutkimuksen tulokset tarjoavat tietoa siitä, miten sosiaalisen kestävyyden osa-alueet toteutuvat tapaustutkimukseen valikoituneella yrityskampuksella.
Tutkimuksen tulokset osoittavat terveyteen, turvallisuuteen ja hyvinvointiin sekä oikeudenmukaisuuteen ja tasa-arvoon liittyvien osa-alueiden olevan tärkeimpiä sosiaalisen kestävyyden osa-alueita. Tämä on nähtävissä sekä tapaustutkimuksen tuloksissa että aiemmissa tutkimuksissa. Tapaustutkimus osoittaa myös, että tärkeimmiksi koetut osa- alueet mielletään kiinteistön käyttäjien toimesta usein myös puutteellisimmin toteutuviksi.
Kaiken kaikkiaan tämä tutkimus tarjoaa yleiskuvan eri sidosryhmien näkemyksistä toimitilakiinteistön sosiaalisesta kestävyydestä. Tämän toivotaan mahdollistavan eri tahojen entistä vahvemman sitouttamisen sosiaalisen kestävyyden tavoitteiden saavuttamiseksi tulevaisuudessa.
Avainsanat sosiaalinen kestävyys, kestävyysarviointi, kiinteistö, toimitilakiinteistö, toimisto
Foreword
Finishing this thesis has been a long and winding road for me, but now it’s finally done and I can be proud of what I have accomplished. This thesis was conducted in co-operation with our client Conficap Oy, and I have especially my thesis advisor Atte Köykkä to thank for helping me come up with such an interesting topic to start researching. Thank you, Atte, also for the brainstorming sessions and feedback given during the past year and a half.
The process of writing the thesis has been a hard one, but also rewarding, as I found the topic genuinely very interesting to work on and it is always nice to see a big project coming to an end.
Special thanks to my thesis supervisor Saija Toivonen for being patient and encouraging with me and making time to discuss both the progression and problems of the thesis on multiple occasions during the process. Without Saija’s help and ideas, there might just not be a thesis to read at all.
I also want to thank all the colleagues, tenants and other people that took time to answer the survey, without you there would not have been data for me to analyse.
Lastly, a huge thank you to my friends and family for listening to me whine about the thesis for almost two years and still being there and staying positive. Big thanks to mom, who has possibly had the biggest impact on me actually finally finishing the thesis this spring. It turns out, that when mom starts planning your graduation party six months before you are even supposed to graduate, you really just want to get the job done and get the party started.
Helsinki, 19thof April 2021
Saara Raitaranta
Sisällysluettelo
Foreword ...5
1 Introduction...1
1.1 Background...1
1.2 Aim of the study and research questions ...3
1.3 Research methodology and sources...4
1.4 Scope ...4
1.5 Research structure...5
2 Social sustainability in real estate...7
2.1 Social sustainability across the field of real estate...7
2.2 Social sustainability in planning ...7
2.3 Social sustainability in sustainability reporting of real estate companies...10
2.4 Social sustainability in building projects ...12
2.5 Social sustainability in building certificates...15
2.6 Comparing the existing frameworks...18
2.7 Creating a framework...20
3 Data and results...33
3.1 Description of the case study – JUJU business campus ...33
3.2 Empirical research methods ...34
3.3 Data collection ...35
3.4 Results...44
3.4.1 Results for the user survey ...44
3.4.2 Results for the service provider survey ...69
3.5 Open feedback from the survey...85
4 Discussion and conclusions ...87
4.1 Key findings of the research ...87
4.2 Discussion ...89
4.3 Research quality and reliability ...93
4.4 Further research...94
4.5 Conclusions ...95
List of references ...96 Appendixes
1 Introduction
1.1 Background
Social sustainability is one of the elements of sustainable development. Sustainable development is a global mega trend (Sitra 2018, PwC 2019) which is defined as “globally, regionally and locally occurring continuous and supervised change, that aims to secure an opportunity for current and following generations to live well” (Ministry of the environment 2017). Sustainable development as a term became widely used after the publication of Report of the World Commission on Environment and Development: “Our Common Future”
where it is defined as “paths of human progress that meet the needs and aspirations of the present generation without compromising the ability of future generations to meet their needs” (Brundtland 1987).
Sustainable development consists of three deeply intertwined elements: the ecological, social and economic elements (Elkington 1997). While ecological aspects of sustainable development are often most emphasized, sustainable development by essence means realizing sustainability in all three aspects (Finnish institute for health and welfare 2018). In today’s political and business environment, social aspects of sustainable development are evermore present and growing. The meaningfulness of business and management is emphasised, economy is beginning to be evaluated by sustainability meters instead of purely growth and size, and the sustainability crisis is furthermore escalating (Sitra 2018). People feel the need in all aspects of life to participate in something more meaningful than a quest for profit, while the biggest challenge in resolving climate crisis is to do so without negatively affecting economic growth and social aspects such as perceived well-being (Sitra 2018).
Social responsibility in business used to be mostly a marketing strategy that often was not implemented in the actual business activity, but that is not the case anymore. In today’s society sustainability, and social responsibility as a part of it, is becoming a defining aspect in business. Sustainability is increasingly becoming “the lens through which a business is judged by its consumers, workforce, society and increasingly its investors”. (PwC 2019) Real estate and the built environment in its entirety makes a significant contribution to all three aspects of sustainability. The full lifecycle of built environment approximately contributes to around 40 percent of global energy consumption (Rakennettu ympäristö 2013) and to over 30 percent of all emissions (Rakennusteollisuus 2017), and also connects to the environmental dimension of sustainability through land use change, consumption of natural recourses, waste production and impacts on biological diversity (Forsberg & von Malmborg 2004). The built environment also has a close bond to economic aspects of sustainability, with private and national capital being tied to built environment and thus supporting economic growth and the national economy (ARUP 2016; EPRA 2016). Social sustainability in the built environment relates to supply of homes and business premises, social equality, quality of life, employment and health (Brandon et al. 2017; Hoesli & Gibb 2003).
The major contribution of the built environment in all sustainability aspects makes it one of the globally most potential sectors in achieving goals of sustainable development (IPCC 2014; Puppim De Oliveira et al. 2013). Sustainability aspects are increasingly considered in demands for the built environment (Toivonen 2011; Toivonen & Viitanen 2015; Yildiz &
Ozerim 2014). The demands are implemented in different forms, such as legal requirements
and institutional obligations, financial incentives and social and customer pressure (Rashidfarokhi 2019).
Sustainability in the field of real estate has been previously researched from multiple point of views, especially considering the aspect of environmental sustainability, which is also widely acknowledged in many building certifications such as LEED, BREAAM and DGNB.
Social sustainability in real estate has been researched especially from the point views of planning (Rashidfarokhi, 2018b), sustainability reporting (Rashidfarokhi 2018a) and building projects (Ahmad et al. 2017;Stender & Walter 2019).
Previous research has found that if different stakeholders in the sector of built environment understand and commit to approaches offered by the scientific community, great sustainability goals can be achieved (see, for example, Bal et al. 2013; Brandon & Lombardi 2010; Lombardi et al. 2009). Thus, by researching stakeholders’ requirements and preferences and priorities of social sustainability, existing sustainability frameworks and approaches can be further evaluated and improved to both meet the sustainability requirements set by legal and institutional governance and to create added value to stakeholders’ core business. Researching different stakeholders’ preferences on social sustainability also enables further commitment towards social sustainability from different stakeholders, such as users and service providers, which is crucial in order to achieving social sustainability in the long run.
1.2 Aim of the study and research questions
The overall purpose of this thesis is to research the essence and importance of social sustainability in real estate. The thesis aims to understand the social sustainability demands, requirements, preferences and priorities of different stakeholders by creating a social sustainability framework and assessing the social sustainability of an existing business campus using the created framework. The thesis is also trying to find relevant data for providing a social sustainability report for the owner of the business campus in question in order to help them to understand and meet the social sustainability demands of other stakeholders in the future.
The aim of the thesis is defined by the following research questions:
1. What are the known elements of social sustainability in real estate?
2. Which requirements and preferences do different stakeholders have for social sustainability and how do they realise within the case study business campus?
Within the first research question, the thesis tries to form an overall picture of the acknowledged elements of social sustainability by conducting a literature review of previous research on the field. The outcome of the literature review is a framework of social sustainability elements relevant to real estate. In addition, the first research question relates to the empirical research of the thesis, where surveys are conducted to define how the found elements of social sustainability are implemented in the business campus that the case study concentrates on.
The second research question is answered by the empirical research, where different stakeholders related to the real estate are surveyed about their demands, requirements, preferences and priorities of elements of social sustainability, as well as the perceived realisation of said elements within the business campus in the case study.
1.3 Research methodology and sources
The thesis consists of two parts, a literature review and empirical research.
The literature review firstly studies existing research on the topic focusing on finding different elements of social sustainability in real estate. Secondly, the literature review tries to find and create an applicable framework of the elements of social sustainability in real estate, against which the case study can be researched. This is done by studying existing research of social sustainability in different branches of real estate, planning, sustainability reporting, building projects and building certificates. The studies used as main sources in the literature review are from Finland, Denmark, Cyprus and Pakistan, and are relatively recent, being published between 2017 and 2019, while the sustainability certificates that were mostly used in the study are LEED and DGNB.
The empirical research part of the study includes a case study that concentrates on testing the framework created in the literature review by surveying users and service providers of the JUJU Business campus in Helsinki, Finland. In the empirical research, a survey is conducted in order to identify different stakeholders’ demands, requirements, preferences and priorities of the social sustainability elements found in the literature review. The survey serves a purpose for understanding users and service providers’ social sustainability needs and wishes on a larger scale, which in turn enables higher commitment to the causes from these stakeholders. The empirical research also provides information about how the existing social sustainability elements and aspects of the business campus in question are seen by users and service providers, by surveying different stakeholders. A survey has the means to be both a qualitative and quantitative research method and in the case of this study both aspects are represented with the survey having both closed and open ended questions.
However, the main body of information gathered from the survey falls under the quantitative method since the main emphasis of the survey is on the closed questions. The empirical research methods are described in more detail in subchapter 3.1. Empirical research methods The JUJU Business campus consists of five individual buildings located in the same area in Pitäjänmäki, Helsinki. The buildings have been built between 1967 and 1991 and have surface areas between 4290 and 15569 smq. A more detailed description of the individual buildings and the business campus is given in the data and results chapter.
1.4 Scope
The scope of this thesis covers the importance of social sustainability aspects in an existing in-use multi-user business campus, thus ruling out the planning process and development of real estate as well as other types of real estate such as housing, logistics property and retail property.
The scope covers two main stakeholders in an in-use business campus: users or tenants and service providers. The service providers include service providers working in maintenance, construction and lobby services. Public authorities, city planners, real estate developers, architects and builders, as well as other stakeholders relating to the planning or development process of real estate are excluded from this thesis.
Geographically, the scope of the thesis is strictly defined as just the Pitäjänmäki area in Helsinki, but it is believed that the results of the study and the created framework can be also widely applied to business campuses elsewhere in at least Finland and most of Europe.
1.5 Research structure
The structure of the thesis is presented in this sub-chapter.
In the first chapter, the topic of the thesis is introduced by providing background for why the topic is relevant and the research should be conducted. The aim and purpose of the study is presented followed by specifying the research questions. The used methodology and sources are showcased and the restrictions of the scope specified. Lastly, the introduction chapter exhibits the structure of the thesis.
The second chapter is where the literature review is conducted. In this chapter, a number of existing research is presented and summarised and an applicable framework is composed for the case study.
The third chapter presents the data and results of the empirical research, which in this thesis consists of the results of the stakeholders’ interviews as well as other data found relating to the case study.
In the fourth chapter, the data from the empirical research is reflected against the previous existing literature and the framework, and is presented in the second chapter. The findings of the empirical research are discussed based on the literature review and finally conclusions are drawn from the comparison to evaluate the elements of the framework based on stakeholders’ preferences. The fourth chapter also tries to provide social sustainability information for the real estate owner, concentrating on specifying the elements of social sustainability that are especially important for different stakeholders.
2 Social sustainability in real estate
In this chapter, exiting literature and research on the topic of social sustainability across the different branches of real estate is referenced in order to form a comprehensive view of the vital social sustainability indicators that need to be considered in assessing the social sustainability of real estate. Finally, a framework is created based on these observations.
2.1 Social sustainability across the field of real estate
Social sustainability is a growing concern throughout the field of real estate. Still, a collective understanding of social sustainability in real estate is missing. Studies have mainly concentrated on analyzing social sustainability in processes connected to land use planning (see, for example, Darchen & Ladouceur 2013; González Martínez 2015; Johansson et al.
2016; Kahila-Tani et al. 2016; Maginn 2007; Staffans et al. 2010), retail planning policy (Yrjänä & al, 2018) and sustainability reporting in real estate companies (Rashidfarokhi &
al. 2018). Some studies have been made with a focus on social sustainability in construction projects and technical details such as building materials (Ahmad 2017; Park 2017) and some relating to social sustainability in residential buildings (Stender & Walter 2019). With the lack of collective framework to analyse social sustainability in buildings and building projects, a number of studies focus on analysing existing sustainability tools and certification systems and finding social sustainability indicators within them or adding new indicators to better the tool (Olakitan 2018; Stender & Walter 2019). Thus, this paper aims to create a framework to be used specifically in assessing the social sustainability of an existing commercial property by first drawing together information on existing studies of social sustainability in real estate and then testing that framework on an existing and in-use business campus to determine which social sustainability elements are most important to different stakeholders.
2.2 Social sustainability in planning
Social sustainability in planning processes have been studied rather widely and from different perspectives. Maginn in his 2007 study focused specifically on community participation and ethnography in planning processes, with the goal of providing a governance and methodological framework for promoting “inclusionary argumentation and consensus building” as well as helping stakeholders become more aware of their cultural practices, processes and relations, which helps in creating better community participation in the future (Maginn 2007). Similarly, Kahila-Tani et al. in their 2016 study focus on public participation with the viewpoint of using GIS tools to support the process of making the masterplan in Helsinki. Their results show that the GIS tools can have the ability to evolve into a more inclusive participatory planning support system (Kahila-Tani et al. 2016)
Johansson et al. (2016) in turn focused on the possibilities of visualising social sustainability data in a 3D map form, and considered in their study four main aspects of social sustainability: social inclusion, built environment, public services in the municipality and personal finances (Johansson et al. 2016). González Martínez in her 2015 thesis studied social sustainability in a land use planning process of a Colombian city and focused on six main parameters of social sustainability: “citizen participation and empowerment, sense of
belonging, social inclusion, social cohesion, social capital and social mixing” (González Martínez 2015).
However, for the purpose of this thesis the above-mentioned studies are not used as widely for further reference as they have a more focused scope in terms of the social sustainability aspects that are studied. The studies by Yrjänä et al. (2018) and Rashidfarokhi et al. (2018b), which are presented in the next paragraphs, offer a wider view of social sustainability parameters related to planning, which better suits the purpose of creating a new comprehensive social sustainability framework.
Yrjänä et al. (2018) focused their study in analysing retail planning policy discourse in Finland from a sustainability point of view. They collected material from newspaper articles and other media sources published between 1990 and 2015, and used critical discourse analysis to identify social sustainability policy issues discussed in the media and how their weights change throughout the studied era. (Yrjänä et al. 2018)
A holistic sustainability framework was developed to categorize the found issues. Their framework presents six categories related to social sustainability; Social inclusion, Quality of life, Safety, Sense of community, Equity and Local employment. (Yrjänä et al. 2018) Of these six categories, four were found having significant weight in media discourse in the 1990s (Social inclusion, Quality of life, Equity and Local employment), where as in the 2000s only two categories (social inclusion and quality of life) were of significant weight.
This signals a decline in the overall weight of social sustainability compared to economic and environmental sustainability between 1990 and 2015 from 35% to 23% respectively, with environmental sustainability gaining weight by climate change becoming a pressing topic. (Yrjänä et al. 2018)
Yrjänä et al. (2018) conclude, that environmental sustainability aspects have gained more weight in the 2000s compared to the 1990s and that increased control of retail planning is seen in the discourse as the main solution for controlling the problems that are related to the retail planning. Especially preventing the spread of retailing outside of towns and cities to the outskirts into so called car markets was seen as an important sustainability measure, which would both increase accessibility of retail for all people regardless of if they own a car, and also increase or preserve the livelihood of city centers. Yrjänä et al. also note, that the reliability of the empirical findings need to be considered with the knowledge that policy discourse in the media is likely always affected by the reporters and stakeholders bias or power relations.(Yrjänä et al. 2018)
Rashidfarokhi et al. (2018b) studied social sustainability in planning by covering scientific literature and sustainability assessment tools in order to create a tool for assessing social sustainability in land use planning processes and assessed the created tool with a case study.
(Rashidfarokhi et al. 2018b)
They collected and reviewed academic literature and assessment tools and in the first state identified 120 social sustainability elements by the means of content analysis. Secondly, they combined elements with similar content or mutual definitions to reduce the number of elements to 45. In the third stage, they eliminated elements that were not relevant for the scope of the study and thus not elements of land use planning processes. Elements were deemed irrelevant by three conditions; “they were related to the physical world, their
realisation was subject to the fulfilment of other social sustainability elements or they were the objectives of land use planning and not elements of the planning project”. With this elimination, they ended up with a set of 26 elements. Lastly, they grouped the found 26 relevant elements into six general themes in order to make the tool easier to use and understand. (Rashidfarokhi et al. 2018b)
The final six general themes are Equity, Social inclusion, Social cohesion, Social capital, Community participation and Safety.The final 26 elements of social sustainability in land use planning processes under the six general themes are presented in Table 2. (Rashidfarokhi et al. 2018b)
Table 2 Six general themes and the related social sustainability elements (Rashidfarokhi et al. 2018b)
General themes Social sustainability elements
Equity Equal opportunities and access to resources; Inter and intra-generational equity; Gender equity; Equity for minorities and disadvantaged groups
Social inclusion Diversity; Arts and culture; Social integration;
Social mixing; Conflicts mitigation
Social cohesion Community vitality; Active community
organizations; Accessibility to institutions;
Innovation and process; Citizen perception of government performance; Social solidarity; Civic engagement and volunteerism
Social capital Social norms; Social values; Social/civic networks;
Trust and optimism; Access to civic and public spaces
Community participation Knowledge management; Community
empowerment; Partnership and collaboration
Safety Security; Freedom; Resilience
In the second phase of their study, Rashidfarokhi et al. (2018) used the assessment tool to analyse a case study of a land use planning process in the Finnish city of Lappeenranta.
Additional details were provided for every theme of the tool, as well as practical examples of measures that would need to be taken in the planning process to cover the elements. They then used the detailed tool to assess related current legislation and the practical process of the planning. (Rashidfarokhi et al. 2018)
Several shortcomings in social sustainability were found in the legislation as well as the planning process. The legislation was found to lack guidelines and strategies for providing equal opportunity of participation to vulnerable social groups, and for ensuring the inclusion of all interest parties in the planning process. The legislation also lacks “instruments for promoting mutual understanding and a sense of community in public–private–people partnerships” as well as “promotion of the creation of permanent settings for continuous
learning on the changing social environment”. Community participation and safety are considered a part of the legislation, but the legislation fails to specify how much influence people should have in the process and how safety should be addressed in the planning process. (Rashidfarokhi et al. 2018b)
The planning process in question also had a substantial amount of shortcomings in light of the social sustainability tool. Main problems in the process were that the published material and information was only available in Finnish and it was published only in a minimal number of channels, making the information unavailable for many social groups. Three public meetings were held at the town hall to address social capital, community participation and safety. In these meetings, the public was allowed to raise questions and express their opinions in written form with their names required. This raises questions about the actual safety of participants in the process, and can be seen as an inadequate means of tackling these issues. (Rashidfarokhi et al. 2018b)
Overall, results of the study highlight community participation as the main approach to social sustainability. However, despite existing guidelines for the participation process, it was unclear how much influence people can actually have in the decision-making process.
Shortcomings were most significant in the areas of equity and social inclusion, which was seen as problems in the information flow, language and addressing of special needs.
(Rashidfarokhi et al. 2018b)
2.3 Social sustainability in sustainability reporting of real estate companies
The real estate sector as a whole has a significant impact on the environment, economy and society. Thus, sustainability is a growing concern among the sector and sustainability reporting has emerged as a widely used tool and a standard practice among larger companies working in the real estate sector (KPMG 2015). Corporate Social Responsibility, CSR, is described by Tsoutsoura (2004) as “policies, practices and programs that integrate into business processes in a company and usually embrace a number of issues, traditionally framed as business ethics, community investment, environmental concerns, corporate governance, human rights, and the marketplace and workplace”.
Reporting on sustainability issues by the means of CSR is shown by studies to increase transparency (Glass 2012), lower economical or material risks (Elkington, 2004) and to provide reputational capital (Crowther 2003) and competitive advantage (Jones et al., 2015).
The European Union has also strongly promoted CSR reporting (Yildiz & Ozerim 2014), but the practice is still voluntary in most European countries (Carrots & Sticks 2016).
Because sustainability reporting is still mainly a voluntary process for companies and sustainability as a concept itself lacks a unified and comprehensive definition (Byrch et al.
2007), there is a lack of common global standard for sustainability reporting for companies.
In order to unify reporting practices among companies, some organisations have created voluntary standard frameworks for CSR reporting. Such organisations include for example Global Reporting Initiative (GRI), International Integrated Reporting Council (GRESB), and European Public Real Estate Association (EPRA). The European Union has also since 2017,
required certain large public-interest corporations to issue sustainability reporting (European Commission 2016).
To fill in the gap of missing research and unified and comparable reporting practices, Rashidfarokhi et al. (2018a) studied the practice of sustainability reporting in eight Nordic real estate investment and construction companies. Their goal was to identify the strengths and weaknesses of sustainability reporting practices in the real estate sector.
Their research based on content analysis of the sustainability reports issued by the studied group of companies. The selected eight real estate investment and construction companies are the ones that are listed in either the Helsinki stock exchange or the Stockholm stock exchange and publish sustainability reports on yearly bases. They studied both the quantity and quality of content in the collected documents dated between 2013 and 2014. By the means of content analysis, they were able to code and analyse all content of the documents based on the quantity of information and the quality of information. The quantity was measured by analysis of how often the three different subsections of sustainability, economic, environmental and social were mentioned in the text. The quality was measured by analysing how the given information was distributed between three information types;
sustainability aims and values, sustainability measures and practices and sustainability performance data. (Rashidfarokhi et al. 2018a)
Their findings show, that there is still not a universally consistent approach to sustainability reporting among the sample companies. Most of the companies chose to publish their sustainability reporting as a part of their annual reports as opposed to publishing them as independent publications. Even though majority of the companies’ sustainability reporting complied with the CRI CRESS index, none of the companies managed to address all of the recommended codes of the index. All of the sample companies failed to report all three information types for all codes of the CRESS index. Materiality and external assurance of the reports was also seen as a shortcoming for most of the sample companies. Some companies used a proposed materiality matrix, but only for the business critical parts of their reporting. (Rashidfarokhi et al. 2018a)
Rashidfarokhi et al. (2018a) also found that of their eight sample companies, the real estate investment companies had a more systematic approach to sustainability reporting compared to the construction companies. This might be due to the fact that all sample real estate investment companies are a part of EPRA. EPRA has clear guidelines for CRESS and requires its members to follow them. This might be a wider scale indicator of companies focusing their sustainability reporting on subjects, that are somehow mandatory or required of them, or that are of internal importance to the company. These requirements might be such as legal requirements or requirements of an outside organization such as EPRA or the Stock Exchange, while internally important subjects can include subjects that need reporting in order to minimize financial risk. The results also indicate that companies might be reporting extensively only on the issues they were best succeeding in and only superficially covering issues where there was a lack of existing data of good sustainability performance.
Rashidfarokhi et al.’s (2018a) findings show that social responsibility was the most reported theme of sustainability in the reports, with 36% of sustainability information relating to social sustainability. Environmental sustainability was the second most reported theme with 34% coverage and economical sustainability came third with 30% coverage. Overall, all three themes were quite equally mentioned in the reports. However, the information types
reported under each theme differed quite drastically. The economic theme was mostly covered with information type 2, meaning sustainability measures and practice, which is likely due to the Finnish legislation concerning returns and actions of businesses, called the Accounting Act, which requires companies to provide detailed information for taxation. In addition, most of the information related to environmental sustainability was type 2 information, sustainability measures and practice. This is most likely due to the environmental pressure caused by real estate’s effect on climate change and the environment, which makes companies pay closer attention to their performance in environmental sustainability. The most reported information type for social sustainability related information was information type 3, meaning qualitative and quantitative sustainability performance data. However, a vast majority of social sustainability information was under the sub-theme occupational safety and health, which is a category strongly regulated under the Occupational Safety and Health Act (738/2002). (Rashidfarokhi et al. 2018a)
All in all the results show a clear tendency in reporting mainly in themes that are required by law or that can result in monetary gain for the companies. Reporting in subjects not regulated by outside powers tends to be more vague and poor in qualitative and quantitative content. It is clear by looking at the results of Rashidfarokhi et al. (2018a) that companies have not yet fully understood the potential reputational gain and stakeholder engagement that comprehensive sustainability reporting is capable of producing for them. (
2.4 Social sustainability in building projects
Social sustainability in building projects and existing residential buildings has been studied by a few different authors, such as Ahmad et al. (2017) and Stender and Walter (2019). As in other social sustainability studies in the field of real estate, a clear gap exists in holistic and unified assessments for social sustainability in building projects and existing buildings.
To fill this gab, Ahmad et al. (2017) researched social sustainability in residential buildings and based on their literary research as well as surveys and interviews, compiled a framework with weighed attributes for social sustainability. The qualitative framework takes quantitative attributes as inputs in order to assess an existing buildings social sustainability.
They argue that sustainability assessments hold a key role in realising sustainable buildings.
There are hundreds of assessment frameworks for sustainability in buildings, but there is a clear lack of tools concentrating on specifically social sustainability, compared to tools for environmental and economic sustainability. For the life cycle assessment of buildings, social sustainability is also an important aspect, which cannot be overlooked. (Ahmad et al. 2017) The goal of Ahmad et al. in their 2017 study is to compile a clear and comprehensive framework for assessing specifically the social sustainability of residential buildings. In order to achieve this they collect data from international surveys and interviews in order to assign weights for the different social sustainability indicators, parameters and sub- indicators in the study. In their literature review, they find eight sustainability indicators that are commonly addressed and recognized in relevant research: health, participation, safety, security, accessibility, education and identity. They notify that social sustainability indicators are hard to identify, select and measure, due to the ambiguity and variety in stakeholder priorities and views. (Ahmad et al. 2017)
Ahmad et al. (2017) argue that a buildings sustainability cannot be assessed without taking into consideration its surroundings, such as its proximity to community and transport services like schools and public transport. Thus, in their proposed framework they also consider the relation of a building with its immediate surroundings as well as the whole city.
They use published studies as a basis for identifying social sustainability indicators with a generic standing for the framework. They then divide the indicators to parameters and further down to sub-indicators, which are either purely subjective or purely objective in nature and also only either represent the building or its surroundings, never both. This makes the sub- indicators the most unambiguous and clearest set of data for forming a comprehensive framework. (ahmad et al. 2017)
They assign relative weights for the sub-indicators by conducting international surveys and interviews among professionals in the real estate sector. In the surveys, the respondents gave weights to indicators and parameters, and in the structured interviews they were asked to give priorities to each sub-indicator. They included both commercial and residential buildings in their survey. They also asked the interviewees to depict the characteristics of good sub-indicators. (Ahmad et al. 2017)
As a result, Ahmad et al. (2017) came up with a framework for assigning social sustainability measurements for buildings. The final ten parameters in the order of importance or relative weight in the framework are usability, functionality and aesthetic aspects; architectural considerations, integration of cultural heritage and level of compatibility with local heritage values; innovation and design process; indoor environmental quality; health and well-being;
safety; open space availability; number of facility users; accessibility and community amenities provision. (Ahmad et al. 2017)
Stender & Walter (2019) in their study, “The role of social sustainability in building assessment”, consider the possibilities of measuring social sustainability in refurbishment or construction projects. As a basis, they use multiple case studies of construction and refurbishment projects of Danish housing and the DGNB (Deutsche Gesellschaft für Nachhaltiges Bauen) certification system. They especially concentrate on two case studies relating to social housing in the Copenhagen area, one where an existing estate was entirely refurbished, and one where a completely new housing area was built. (Stender & Water 2019)
They approach the concept of social sustainability mainly from the perspective of social sciences in their literature review. They question if a building can ever be viewed as socially sustainable as itself, or if it can only become socially sustainable through time and use. It is also argued, that the social sustainability of a building cannot be assessed on its own, but the wider urban neighborhood and the city must also be considered when assessing a building’s social sustainability. They also claim that there is no clear consensus of the criteria that a building or an area must fulfill in order to be socially sustainable. (Stender & Walter 2019) Stender & Walter (2019) emphasise that while social sustainability is a part of the broader concept of sustainability, the three different categories of sustainability can also be contradicting. According to this view, socially sustainable choices may not be environmentally or economically sustainable or the other way around. However, they also claim that while the three dimensions of sustainability can be contradictory in some cases, they also need to be seen as mutually dependent. For example, environmental sustainability can be seen as dependent on social sustainability, as “people will not be able to meet
environmental needs until their own needs have been met to a certain standard”. (Stender &
Walter 2019)
Stender & Walter (2019) study the 2015 collaboration project by Danish housing association, with the aim of better integrating social sustainability in buildings by using the DGNB certification system. The goal was also to expand the DGNB criteria in order to promote collaboration between those that are responsible for the physical refurbishment or building and those that are involved in social activities and services. The project also aimed at analysing how the DGNB assessment tool for buildings and urban areas measures social sustainability, and to evaluate whether it can be improved by integrating social and organizational aspects to the existing criteria evaluating functional aspects. (Stender &
Walter 2019)
The main hypothesis in the project was that clearer criteria and better definition of social sustainability, and incorporating them into building projects or development of urban areas can result in better-functioning neighborhoods in the future. The DGNB system already gives more weight to social sustainability aspects compared to most sustainability certification systems by giving a total weight of 22,5% to social sustainability issues in the assessment. However, there is still room for improvement; in certification for buildings the emphasis has mainly been on functional aspects, such as temperature, indoor air quality, accessibility, safety and quality of architecture. In urban area’s sustainability assessment the focus has been on “social and functional diversity, social and commercial infrastructure, safety, urban life, noise reduction, supply of recreational areas, accessibility, flexibility, urban integration, urban form, usage of existing structure and art in public spaces”. (Stender
& Walter 2019)
The project analysis consisted of three main phases. First, a series of workshops were held with researchers, stakeholders and professionals in order to develop a framework for social sustainability. The framework consist of three main themes: social cohesion, participatory processes and accessibility to living opportunities (Figure 1). Secondly, a series of case studies were conducted in order to analyse the social sustainability of different housing estates through the developed framework. In their analyses they utilized reviewing project documents, site visits, asset mapping of amenities and social networks of the areas, statistical analysis of the socioeconomic characteristics of residents and interviews with residents and professionals. In the third phase, they compared the results of the case studies against the DGNB assessment tool in order to see if the social sustainability initiatives and actions taken, can be seen through the assessment tool’s criteria. (Stender & Walter 2019)
Figure 1 Social sustainability frameworks in Lejerbo, Denmark (Stender & Walter 2019) Stender & Walter (2019) conclude that even though the DGNB assessment includes quite a large set of criteria valuing the physical and functional as well as participatory aspects of social sustainability, it could benefit from adding some new criteria to award social initiative.
These criteria, according to Stender & Walter (2019), could include the following: “(1) initiatives that preserve and integrate existing social networks within new-build and renovation projects; (2) employment of janitors who not only take care of the operation and maintenance of the physical assets but also act as facilitators for social networks and digital communication platforms; and (3) new models for integrating affordable housing and more expensive housing in order to counteract
segregation”. (Stender & Walter 2019)
2.5 Social sustainability in building certificates
Olakitan Atanda (2018) in their study developing a social sustainability assessment framework, aim at creating a social sustainability framework that can be applicable for existing sustainability certifications, especially LEED. They achieve this by first conducting a literature review of suitable previous research and compiling initial criteria for social sustainability based on the review.
Next, they put their initial indicators through a two-round survey for experts and professionals in the field of real estate. Experts were asked to assign importance levels for the proposed set of categories and indicators on a scale of 5. The experts also had the possibility to suggest adding or eliminating some of the proposed categories. On the second round, the experts ranked the categories in the order of importance, but this time they reviewed also the assigned weights and responses from the first round of the questionnaire.
(Olakitan Atanda 2018)
In the third phase of their study, Olakitan Atanda (2018), the compiled framework was tested through holding interviews with a 150 users of certified green buildings, both residential and
public building users were included. The aim of the interviews was to gain information about how the actual users of certified green buildings see the suggested indicators and categories in their use of the building and how much information they have about these aspects of sustainability.
Their final framework consists of eight categories: social equity, environmental education, participation & control, social cohesion, health & safety, accessibility & satisfaction, cultural value and physical resilience. Each category is further divided into three to five individual indicators with weights based on their importance (shown in table 3). (Olakitan Atanda 2018)
Olakitan Atanda (2018) found that in their framework, the highest weight of all categories, with the final weight of 20,1%, was given to the participation and control category, which is also known as one of the most significant categories of social criteria due to its direct relationship with the users of a building. Second most important categories were found to be environmental education and social equity with the weight of 19,5% respectively and on third place came health and safety with a weight of 13,7%. All of the top three categories have a strong relation to the users of the building with participation and control. They emphasise indicators, such as user participation and users’ willingness to act and improve environmental matters, environmental education with indicators such as awareness of physical environment and knowledge of human activity on environment, social equity with the indicators access to information and participation in decision making, and health and safety concentrating in health impacts of materials and energy sources as well as feeling of safety. (Olakitan Atanda 2018)
Table 3 Derived final global weightings scores for social criteria categories and indicators (Olakitan Atanda 2018)
Stender & Walter in their 2019 study concentrated on assessing the existing criteria of social sustainability in the DGNB (Deutsche Gesellschaft für Nachhaltiges Bauen). Their aim was to better integrate social sustainability into the existing certification system in assessing refurbishment and construction projects. They aimed at producing a clearer definition for social sustainability in building projects as well as developing more specific evaluation
criteria for social sustainability for assessment. The purpose is to develop and widen the existing social criteria of the DGNB so that it “promotes collaboration across professional boundaries”, between the physical refurbishment or building and the social activities and services. (Stender & Walter 2019)
The DGNB already takes into consideration some social criteria, which contribute to a total of 22,5% of the overall assessment. This already makes the DGNB assessment tool one of the best existing certification systems for assessing social sustainability. Most other certification systems such as LEED and BREAAM give little to no weight to social sustainability issues in their assessment. However, Stender & Walter (2019) still see room for improvement also in the DGBN criteria, as the focus of social criteria in building certification has until recently been mostly on functional aspects like temperature levels, air quality, accessibility and safety. In assessing urban areas or planning processes, the emphasise tends to be on criteria like noise reduction, safety, accessibility and social and functional diversity. (Stender & Walter 2019)
Stender & Walter (2019) had three main stages to their study. First, they developed a social sustainability framework based on literature and workshops with professionals. Secondly, they conducted multiple case studies in order to analyse the social sustainability of different estates through the developed framework. And third, they compared the findings of the case studies against the criteria of the DGNB assessment tool to see if the physical design and social initiatives would have been captured by the existing criteria of the DGNB tool.
They found that the DGNB assessment tool already rewards a number of physical and functional aspects of social sustainability, as well as the participatory process. However, Stender & Walter (2019) state that the assessment tool could significantly benefit from adding new criteria that award social initiatives. The suggested criteria according to them could include for example: “initiatives that preserve and integrate existing social networks within new-build and renovation projects, employment of janitors who not only take care of the operation and maintenance but also act as facilitators for social networks and digital communication platforms; and new models for integrating affordable housing in order to counter segregation”. (Stender & Walter 2019)
Stender & Walter (2019) note that measuring social sustainability can be difficult due to its qualitative nature, which has further been emphasised in recent years. There has been a change from seeing social sustainability only as fulfilling basic needs like access to housing, jobs and income, to also including qualitative concepts like identity, attachment to place and social capital. This shift requires more collaboration between professionals in different fields. For example, the social sciences have long been studying possibilities to measure qualitative concepts like social capital and social cohesion, which can be of significant help also for the real estate sector when measuring social sustainability.(Stender & Walter 2019) 2.6 Comparing the existing frameworks
As the existing literature is spread widely across different branches of real estate, and the concept of social sustainability is complex, there are some notable differences between the frameworks in each study. However, some factors are noted in almost all existing literature, regardless of the scope of the study ranging from planning to sustainability reporting and existing assessment tools.
The research by Yrjänä et al. (2018) focused on looking at existing discourse from different years concerning social sustainability in retail planning. Thus, the social sustainability categories that were formed are fewer and have a wider scope, than in the other studies where the frameworks have more categories related to more detailed aspects of sustainability. On the other hand, Rashidfarokhi et al. in their study (Rashidfarokhi et al. 2018a) focused on sustainability reporting of real estate companies. This focus shows on the framework as many categories being more related to social sustainability in business activities as opposed to the sustainability of the real estate owned or managed by the companies.
Olakitan Atanda’s (2018) study was more focused on learning about and improving existing sustainability assessment tools. This gave the framework created in the study a scope more focused on environmental aspects of social sustainability, as environmental sustainability aspects are the aspects that are already widely considered within existing sustainability assessment tools.
Ahmad et al. in their (2017) framework gave a lot of weight to categories relating to the designing process of residential buildings, as well as usability and indoor environmental quality, which show the scope of the study being more strictly related to individual residential buildings than the other existing literature. Stender & Walter in their (2019) study were also focused on residential building projects, but more from the viewpoint of studying a residential area as opposed to individual buildings. They gave a lot of weight to social cohesion, grouping half of their individual indicators under this category, and they were focused more on creating a community within that residential area, not so much on assessing the buildings.
Regardless of the differences found between the framework of existing research, some social sustainability factors were clearly seen across the existing literature. Health, safety and well- being were in some form mentioned in each study regardless of the scope of the research.
Employment and education also stood out being mentioned in all but two of the studies (Ahmad et al. 2017; Olakitan Atanda 2018), which were focused on building projects and existing building assessment tools. It seems that employment and education are seen especially important within social sustainability in planning, where it relates to planning of schools and commercial properties so that they are accessible from residential areas.
Equity was also mentioned in all but two of the studies (Ahmad et al. 2017; Stender & Walter 2019). Stender & Walter however consider factors such as inclusion and participation, which in some parts are overlapping with the factor of equity. Ahmad et al. focused rather strictly on assessing the social sustainability of an individual residential building and its building process, which explains little weight given to equity as the underlying expectation is that the user of the building is a part of the planning of the building and can thus affect the outcome of the project. Also residential building like the ones considered in the Ahmad et al. (2017) study only typically have one person or family as the user, which may decrease the need for considering more societal factor such as equity. It is likely for the same reason, that Ahmad et al. (2017) were the only ones that did not consider sense of community as a factor of social sustainability in their study.
Social mixing and accessibility were also mentioned in all but two of the studies (Yrjänä et al. 2018; Rashidfarokhi et al. 2018a), which are related to retail planning and sustainability reporting. In the study of Yrjänä et al. (2018) however, the category of accessibility exists, but is grouped under environmental sustainability as opposed to social sustainability. In the study of Rashidfarokhi et al. (2018) the focus was, as previously stated, on sustainability reporting of companies, and thus less related to actual physical accessibility. However, some
categories in their framework can be seen as relating to accessibility of services, such as occupational health and safety (access to healthcare) and training and education (access to education for the employees).
Overall, health, safety and well-being, equity, employment and education and factors related to social cohesion or social mixing, seem to be mentioned across the board in studies of social sustainability in the field of real estate. This gives reason to believe that these are some of the most important factors also to consider when creating a new framework for assessing social sustainability in real estate.
2.7 Creating a framework
In this chapter, the process of creating a framework for assessing social sustainability in an in-use business campus is explained. The framework for this study is created based on a literature review of relevant research.
The framework for this study was created by conducting a comprehensive literature review of relevant research in the field of social sustainability in real estate. Because no existing literature of social sustainability in in-use commercial buildings was found, the framework utilises previous research concerning social sustainability in planning, building and renovation projects of residential buildings, sustainability reporting practices of listed real estate companies and existing sustainability assessment tools and certificates.
The main sources for creating the framework were six studies that were found most relevant for the purpose, shown in table 4.
Table 4 Studies used in creating the framework Social sustainability tool for assessing land use planning processes (Rashidfarokhi et al.
2018)
Social sustainability in planning
Looking at retail planning policy through a sustainability lens: Evidence from policy discourse in Finland (Yrjänä et al. 2018)
Social sustainability in planning
Sustainability reporting in the Nordic real estate companies: Empirical evidence from Finland (Rashidfarokhi et al. 2018)
Social sustainability in sustainability reporting
Developing a residential building-related social sustainability assessment framework and its implications for BIM (Ahmad et al.
2017)
Social sustainability in building projects
The role of social sustainability in building
assessment (Stender & Walter 2019) Social sustainability in building projects, social sustainability in existing sustainability assessment tools
Developing a Social Sustainability Assessment Framework (Olakitan Atanda 2018)
Social sustainability in existing assessment tools
The process of creating the framework for the thesis consists of nine stages and four rounds of eliminations, which are presented in Figure 2, and discussed further in the next part of the study.
Figure 2 The stages of creating the framework
In the first stage of creating the framework for this study, the existing frameworks of the six chosen studies were collected and presented next to each other. The indicators in each framework were then coded by their content in the second stage and indicators with the same code were grouped under seventeen larger categories with similar contents in stage three.
Some indicators were already left out in the coding process (stage 2, first round of elimination) due to their irrelevancy to the topic of the study. Most of the indicators eliminated in this stage of the process were related to social sustainability in sustainability reporting. Among the eliminated indicators were supplier assessment for labour practices, child labour and product and service labelling. Other indicators eliminated already in the coding process were related to strictly residential real estate, such as “number of inhabitable spaces for building residents” and “max. number of users per inhabitable space (building residents)”, and extreme natural phenomena not relevant in the scope of Finnish real estate, such as “compliance to earthquake resistance code” and “sustainable management of hazards”.
After the initial elimination of categories, the framework consisted of seventeen categories with multiple indicators under them (stage 3). The seventeen categories at this point were as shown in Table 5.
Table 5 Social sustainability categories after the first round of elimination 1. Employment and education
2. Health, safety and well-being 3. Equity
4. Social inclusion 5. Participation
6. Sense of community 7. Accessibility (services) 8. Accessibility (spatial)
9. Knowledge management/access to information
10. Social mixing
11. Identity/Sense of attachment 12. Environmental awareness 13. Indoor environmental quality 14. Usability and satisfaction 15. Cultural value
16. Quality of life
17. Resilience and convertibility
In the fourth stage of creating the framework, similar indicators within and between different categories were merged together or eliminated (second round of elimination). For example in the health and safety category, indicators such as occupational health and safety and client health and safety were eliminated and safety, security and health impacts of materials and indoor air quality were kept, as they are more relevant to measuring social sustainability in an in-use building. In the social inclusion category, soft and hard social infrastructure indicators were eliminated and merged with the indicators of social integration and social mixing in the social mixing category, due to similar contents of the indicators. The environmental awareness category was eliminated altogether and its content was devided between the health, safety and well-being category and the access to information category.
In addition, the indoor environmental quality category was eliminated as such and merged with the health, safety and well-being category. The participation category was eliminated and its content was merged with the social inclusion and sense of community categories.
The framework (stage 5) after the second round of elimination is shown in Table 6.
Table 6 The framework after the second round of elimination
Categories Indicators
1. Employment and
education Employment
Education 2. Health, safety and well-
being Health impact of materials and indoor environmental quality
Security practices Safety practises Feeling of safety
3. Equity Gender equity
Non-discrimination
Diversity and equal opportunity 4. Social inclusion Social networks
Social inclusion Social capital
Connected community 5. Sense of community Social cohesion
Community stability Community vitality 6. Social mixing and
integration Social integration/soft social infrastructure Social mixing/hard social infrastructure
7. Identity Sense of attachment/pride
8. Spatial accessibility Accessibility for minorities and disadvantaged groups Accessibility by public transport
9. Access to services Equal access to key services
Equal opportunities and access to resources 10. Access to
information/knowledge management
Knowledge management/Access to information
Satisfaction on functionality
