Impact of ESG on Facilities Operations can take Many Forms

Introduction

In my blog a month ago, I highlighted what Environment, Social Responsibility, & Governance (ESG) is and why facilities managers should be aware of it. Then, a couple of weeks ago, I covered the importance of having a solid, well-documented transition plan to track your intended improvement in ESG performance. Another area of importance for facilities managers is understanding where they may see required changes in support of Authorities Having Jurisdiction (AHJ) compliance, corporate initiatives, and public commitments.

ESG covers many functional areas within a company. Moreover, many facilities managers are responsible for buildings in multiple countries or states that may have differing compliance requirements. This can be very confusing as it leads to an increase in the complexity of your ESG compliance or improvement strategy.

This article will provide a couple of examples of adjustments you can make to comply with AHJ requirements across geographies.     

What a Difference the Location Makes

In one of my positions, I was responsible for Security, Food Service, Landscaping, Janitorial, and a myriad of other soft services across 185 pharma & medical device sites in Canada, Mexico, and the U.S. I’m sure you can imagine the complexity of ensuring that the sites met a corporate standard (that in many instances was in the process of being initially deployed) while also meeting the location-specific requirements. This is a challenge that multi-site organizations might all share.

Imagine that you are a national landscaping company needing to balance long growing seasons and short growing seasons. Across multiple sites, it is necessary to know which operations are in places where irrigation is crucial and conversely where it is not so much. Which places have turf areas, and which have xeriscaping? Areas with snow and those without. All are balanced to meet the standard.

Now, let’s add the new complexity of ESG to the mix. As an example, in the State of Colorado, Governor Jared Polis recently signed an executive order (D 2023 018) that requires “the electrification of lawn and garden equipment used by the state government.” It appears that this only applies to the “ozone non-attainment area,” which would currently include the entire Denver metropolitan area. Here is the wording from that specific section of the order:

“Creating Policy to Phase Out Gas-Powered Lawn and Garden Equipment

  1. I direct CDPHE and DPA, in consultation with other relevant State agencies, to establish a policy to phase out the use of gas-powered push and hand-held lawn and garden equipment with internal combustion engines that are less than 25 horsepower by State agencies in the ozone nonattainment area and explore the feasibility of expanding this phase-out to all statewide operations by January 31, 2024. The phase-out should be complete for equipment owned and utilized by State agencies in non-exempted locations and activities in the ozone nonattainment area by June 1, 2025, to the maximum extent possible with current funds and definitively if an adequate budget is approved by the Colorado General Assembly. Contractors utilizing electric lawn and garden equipment will continue to be prioritized during procurement. Covered push and hand-held lawn and garden equipment include, but are not limited to, aerators, brush cutters, chainsaws with guide bars under 18 inches, dethatchers, edgers, grass trimmers, hedge trimmers, push lawn mowers, leaf blowers, power washers, rotary tillers, weed whackers, and any other handheld gas-powered lawn and garden equipment. This policy will not apply to equipment used for the purpose of abating or preventing damage during a declared disaster emergency, equipment used by first responders to provide emergency services, or for the purpose of fire hazard reduction activities in or near wildland areas or wildland urban interface.
  2. In determining an appropriate policy for the phase-out of this equipment, CDPHE and DPA must consider technical feasibility of equipment use, and feasibility of use in remote areas and ensure the policy does not disrupt critical State functions including wildfire or aquatic nuisance species mitigation and management, emergency response, or lead to other unintended consequences that worsen air quality. CDPHE and DPA should also consider the feasibility of phasing out or electrification of riding lawn mowers used by State agencies in this policy.
  3. I direct CDPHE and DPA to report to the Governor’s office by September 30, 2023, with a budget within State resources, to achieve this goal and calculation of emissions and fuel cost reductions associated with the proposed policy.”

This executive order is like the one rolled out in California in 2021 that eliminates small gas engines effective 01/2024. However, the CA law has a wider effect as it is not limited to use at state facilities in ozone non-attainment areas.

This is not just a state-wide item; there are also county or city ordinances that ban such equipment, and some of those are even seasonal. This makes it even more complex for the facility manager.

The movement away from small gas engines is a great move for our environment. Leaf blowers, edgers, or weed whackers that are electric or battery operated have worked well for years, and lawn mowers are getting better in the past year, so the quality of work is improving. It's still not quite the same, but better. I know there is still an impact on worker productivity and certainly a capital infusion requirement, and those are the biggest impacts that will really hurt service providers. But, as the EPA pointed out in 2007, the use of a push lawn mower like this can emit the same pollution in an hour as 11 cars, or if it is a riding lawn mower, it is more in line with 34 cars. The same publication from the EPA estimates that Americans spend about 3 billion hours per year using lawn and garden equipment.

Now, imagine you are a national landscaping contractor who provides services to sites around the country, including state offices in Colorado along with non-state offices in Colorado. To make the point even more clear, perhaps you have a state office in Denver that must be “electrified” by 6/1/2025, but you also have the commercial property across the street that the same crew will service. Do you need to have “electrified crews” and “non-electrified crews”? Do you convert your whole operation to electrified?

What a Difference the Location Makes

In one of my positions, I was responsible for Security, Food Service, Landscaping, Janitorial, and a myriad of other soft services across 185 pharma & medical device sites in Canada, Mexico, and the U.S. I’m sure you can imagine the complexity of ensuring that the sites met a corporate standard (that in many instances was in the process of being initially deployed) while also meeting the location-specific requirements. This is a challenge that multi-site organizations might all share.

Imagine that you are a national landscaping company needing to balance long growing seasons and short growing seasons. Across multiple sites, it is necessary to know which operations are in places where irrigation is crucial and conversely where it is not so much. Which places have turf areas, and which have xeriscaping? Areas with snow and those without. All are balanced to meet the standard.

Now, let’s add the new complexity of ESG to the mix. As an example, in the State of Colorado, Governor Jared Polis recently signed an executive order (D 2023 018) that requires “the electrification of lawn and garden equipment used by the state government.” It appears that this only applies to the “ozone non-attainment area,” which would currently include the entire Denver metropolitan area. Here is the wording from that specific section of the order:

“Creating Policy to Phase Out Gas-Powered Lawn and Garden Equipment

  1. I direct CDPHE and DPA, in consultation with other relevant State agencies, to establish a policy to phase out the use of gas-powered push and hand-held lawn and garden equipment with internal combustion engines that are less than 25 horsepower by State agencies in the ozone nonattainment area and explore the feasibility of expanding this phase-out to all statewide operations by January 31, 2024. The phase-out should be complete for equipment owned and utilized by State agencies in non-exempted locations and activities in the ozone nonattainment area by June 1, 2025, to the maximum extent possible with current funds and definitively if an adequate budget is approved by the Colorado General Assembly. Contractors utilizing electric lawn and garden equipment will continue to be prioritized during procurement. Covered push and hand-held lawn and garden equipment include, but are not limited to, aerators, brush cutters, chainsaws with guide bars under 18 inches, dethatchers, edgers, grass trimmers, hedge trimmers, push lawn mowers, leaf blowers, power washers, rotary tillers, weed whackers, and any other handheld gas-powered lawn and garden equipment. This policy will not apply to equipment used for the purpose of abating or preventing damage during a declared disaster emergency, equipment used by first responders to provide emergency services, or for the purpose of fire hazard reduction activities in or near wildland areas or wildland urban interface.
  2. In determining an appropriate policy for the phase-out of this equipment, CDPHE and DPA must consider technical feasibility of equipment use, and feasibility of use in remote areas and ensure the policy does not disrupt critical State functions including wildfire or aquatic nuisance species mitigation and management, emergency response, or lead to other unintended consequences that worsen air quality. CDPHE and DPA should also consider the feasibility of phasing out or electrification of riding lawn mowers used by State agencies in this policy.
  3. I direct CDPHE and DPA to report to the Governor’s office by September 30, 2023, with a budget within State resources, to achieve this goal and calculation of emissions and fuel cost reductions associated with the proposed policy.”

This executive order is like the one rolled out in California in 2021 that eliminates small gas engines effective 01/2024. However, the CA law has a wider effect as it is not limited to use at state facilities in ozone non-attainment areas.

This is not just a state-wide item; there are also county or city ordinances that ban such equipment, and some of those are even seasonal. This makes it even more complex for the facility manager.

The movement away from small gas engines is a great move for our environment. Leaf blowers, edgers, or weed whackers that are electric or battery operated have worked well for years, and lawn mowers are getting better in the past year, so the quality of work is improving. It's still not quite the same, but better. I know there is still an impact on worker productivity and certainly a capital infusion requirement, and those are the biggest impacts that will really hurt service providers. But, as the EPA pointed out in 2007, the use of a push lawn mower like this can emit the same pollution in an hour as 11 cars, or if it is a riding lawn mower, it is more in line with 34 cars. The same publication from the EPA estimates that Americans spend about 3 billion hours per year using lawn and garden equipment.

Now, imagine you are a national landscaping contractor who provides services to sites around the country, including state offices in Colorado along with non-state offices in Colorado. To make the point even more clear, perhaps you have a state office in Denver that must be “electrified” by 6/1/2025, but you also have the commercial property across the street that the same crew will service. Do you need to have “electrified crews” and “non-electrified crews”? Do you convert your whole operation to electrified?

Moving Forward

ESG provides a lot of challenges but also many benefits to an organization. See Figure 1 for the IFMA infographic covering the FM-oriented ESG areas. Here are a few of the key topics that might take additional efforts by the facilities organization upfront but will also benefit the facilities and their occupants in the long run:

 

 

 

Improved Business Continuity Planningimage-png
  1. Recycling and Composting Programs
  2. Waste Reduction
  3. Focus on Energy Efficiency
  4. Water Conservation Efforts
  5. Emissions Reduction
  6. Biodiversity / Xeriscaping
  7. Occupant Health & Safety
  8. Ethics & Transparency

 

My recommendation is to get out in front of these areas now. We can clearly see them coming. As I wrote in my last blog, start now with a well-defined transition plan that contains the elements of Ambition, Action, and Accountability. Make sure it aligns with your respective company strategies and start making improvements.

An example might play out like this. Your company may have made a public commitment that they are going to reduce their GhG emissions by 50% by 2030. A scope 1 element of GhG reduction might include the electrification of your company vehicles. Let’s say your FM department has three pickup trucks. Start preparing now. Do you still need three pickup trucks? Can you get two instead? What needs do you have? What brand/model is best for your needs? Do you electrify all three or only two? How much do they cost, and what is the lead time? Do you lease or buy? How/where will you re-charge them? Make these decisions now and put them in your future budget.

Conclusion

We have a lot of work to do in multiple areas. Other entities like our management or the government are going to push us to make progress. We can either be driven by them, or we can get ahead and be prepared to help steer the course of our FM operations. I say we get ready to take action now instead of having to react to other people’s decisions later.