Why We Need Transparency in Green Building Certifications

As sustainability becomes a major selling point for real estate buyers, the prevalence of LEED, the Green Globes, and other certification seals is skyrocketing. Because they issue seals of quality for sustainable architecture, non-governmental organization green building councils (GBCs) hold the primary responsibility for developing and implementing green building projects as well as their subsequent certification. Unfortunately, the value of green building certifications tends to be as clear as mud for developers who wish to capitalize upon them as a real estate marketing tool and investment strategy.

Vienna’s MODUL University recently published a study to demystify the role of GBCs in the international sustainable real estate industry. The project includes an industry-wide in-depth survey of international GBCs that includes interviews with board members and analysis of each organization. It also includes a comprehensive case study of the Austrian Sustainable Building Council (Österreichische Gesellschaft für Nachhaltige Immobilienwirtschaft, ÖGNI), which explores the five major factors which affect the scope of HGO’s that promote sustainable construction.

According to project coordinator Dr. Sabine Sedlacek, “sustainable building is a poorly regulated policy area …The decision about whether building certification is sought is purely market-driven and therefore voluntary, as it is made solely by the individuals involved in the project.” Sedlacek goes on to say that the GBC “seal of quality” market is characterized by a lack of transparency overall due to variance in standards, models, and evaluation methods among the different organizations. As verified sustainability is a mark of quality that also increases market value for a given development, this lack of transparency in the market may eventually impede the financing of green building initiatives and the adoption of green building codes.

The study determined that two key criteria for GBC effectiveness must be addressed in order to remedy this cloudy situation: 1. Promoting the perception of these GBCs as reliable partners, and 2. Increasing the size of the organizations. Organizational size translates to public awareness and raises the likelihood that the public will accept the organization’s governance efforts in the sustainable construction industry. Large memberships ensure wider market coverage and larger financial contributions, which make the organization economically viable enough to establish a long-term influence in the market.

Even more crucial for the success of GBC certification is the public perception of these organizations as independent agencies that serve the public good while representing the green-building industry interests of their member businesses. The primary factor which determines independence is the level of accountability demonstrated by each organization. Accountability, as we all know, is the result of a strongly transparent organizational structure. Therefore, transparency is the main factor to address if GBCs are to meet the criteria of perception and size which will establish them as reliable forces in the market.

The better that a GBC meets the demand for transparency, the better it will meet the size and perception criteria which will help it gain public trust and widespread acceptance of its sustainability standards. Because a GBC’s widespread acceptance and adoption are tied to its level of organizational transparency, the success of these GBC’s will likely create a more transparent market overall for sustainability seals of quality. Greater transparency in GBC certification translates to a stronger market value for sustainable construction.

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