by Ainsley Simpson, Chief Executive Officer, Infrastructure Sustainability Council Australia (ISCA) 

“All revolutions are impossible until they happen. Then they become inevitable.” Albie Sachs can teach us a thing or two about the risks and rewards of revolution.

Twice detained in South Africa for his anti-apartheid activities, Sachs was forced into exile in England and later lost an arm and eye when he was blown up by a car bomb.

In 1990, Sachs returned to South Africa to help write the Constitution of South Africa. As someone born in South Africa, Sachs’ quote resonates with me personally.

And as someone who has spent a career championing sustainability in decision-making, these words mean a lot professionally. Sustainability, especially in the infrastructure space, can seem like two steps forward, one step back.

But what can at first appear impossible, through increments, becomes inevitable.

Quadruple bottom line benefits

ISCA has been certifying sustainability performance across Australia and New Zealand now for nearly a decade. We have registered over 180 projects valued at over $206 billion.

We assess infrastructure across the full spectrum of the asset lifecycle and we measure impact across the quadruple bottom line of economic, environmental, social and governance.

From that we have built a strong evidence base that brings into sharp focus just how sustainable infrastructure delivers better outcomes for people and the planet. We’ve tracked a 68 per cent reduction in energy consumption, a 34 per cent 76.

SUSTAINABILITY reduction in water consumption and an 11 per cent diversion of waste from landfill from just 38 projects in the last reporting period.

The impact on people is just as profound – 1.2 billion customer experience improvements though transport and utility provision, and nearly 1,600 jobs in construction and operations.

Our data on the broader benefits of sustainable infrastructure shines a light on both incremental and exponential improvements. For every $1 of investment in a project undertaking a sustainability rating, up to $2.40 is returned.

We know this is a conservative estimate as some benefits are not easily monetised, like cultural and social outcomes, health impacts and human capital development. We know pursuing an IS Rating upskills the workforce, encourages innovation and drives process improvements.

People learn to think more strategically across the asset lifecycle, which in turn enhances procurement and supply chain efficiencies. IS ratings also de-risk assets and boost economic performance.

The decade for decarbonisation

However, with infrastructure enabling 70 per cent of Australians emissions, we have the enormous opportunity to do more. This is the decade for decarbonisation.

The infrastructure assets built today will still be operating in 2050 when countries like Australia are expected to reach net zero emissions under the Paris Climate Agreement. Infrastructure unable to meet net zero targets risks a future as ‘stranded’ assets.

At ISCA, we are driving emissions reduction by rewarding resource efficiency, design optimisation and lifecycle assessment. But the real opportunity for significant emission reduction is through our planning and early decision making – deciding if, what and why we build.

We need to keep our eyes on the prize – this is a systemwide revolution which needs to align policy, planning, procurement and practice. But all of the levers of sustainability are aligning: policy, planning, procurement, investment and insurance.

We have never had this level of synergy before. In April, Infrastructure Australia launched new sustainability principles that balance economic, environmental, social and governance, or ESG, outcomes.

According to Infrastructure Australia CEO, Romilly Madew, these principles signal a new determination to “put sustainability front and centre”.

The principles, which will now be embedded in Infrastructure Australia’s Assessment Framework, align with the IS Rating scheme, which itself is in lockstep with the UN’s Sustainable Development Goals.

Three calls to action

Also on the policy front, many state government departments now contractually require sustainability performance to be measured using IS.

As just a few examples, New South Wales is mandating IS on all critical state-significant infrastructure. Down south, the Victorian Government is delivering IS throughout the Level Crossing Removal and Melbourne Metro programs, while Queensland has embedded it into the detailed business case development.

Investors are now on the hunt for sustainable assets with more than US$1.2 trillion in green bonds issued. Money is pouring into socially-responsible funds as investors look to capitalise on the outperformance of ESG-aligned funds over the last 12 months.

Meanwhile, the insurance industry is redirecting its efforts towards a more sustainable and resilient future. Take just one example of Swiss Re, one of the world’s largest reinsurers, which started benchmarking its assets against an ESG framework in 2017.

Today, ESG criteria is applied to nearly 100 per cent of its USD$130 billion portfolio. Christian Wertli, Swiss Re’s Head Infrastructure Solutions, is on record saying that the long-term risk adjusted investment performance of infrastructure assets is “more favourable when ESG criteria are taken into account”.

The signs are positive, and much of Australia’s infrastructure industry is now singing from the same song sheet. So how can we scale our impact? I have three calls to action:

1. Measure what matters: We know measurement leads to better management. It is never too late to look for longterm social, environment and cultural benefits, alongside the economic ones.

2. Think both big and small: ISCA is commencing the pilot of IS Essentials – sustainability certification that supports smaller projects of between $5 and $50 million in value. With the right support, sustainability can be embedded into every local government, precinct and social infrastructure project.

3. Collaborate to innovate: ISCA is currently working to progress Reshaping Infrastructure (with ASBEC, ClimateWorks), which set the scene to recalibrate Australia’s infrastructure agenda around net zero emissions. State collaborations include the NSW Government, Materials & Embodied Carbon Leaders’ Alliance, Queensland Infrastructure Co-Lab, Roads Australia, and at the Federal Government level, we are partnering to improve the national uptake of low carbon and recycled materials. These are just two examples of how industry and government are working together, because a problem shared is a problem solved faster.

Together, we can step up to the challenges of the coming decade and deliver infrastructure that supports resilient, inclusive and low carbon lifestyles, communities and economies. Together, we can turn the impossible into the inevitable.

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