Southeast Asian construction market revenue is projected to reach $538.5 billion in 2024, according to data and analytics firm GlobalData. The sector is essential for government in the region as improvements in transportation, energy, tourism, and public structures tend to stimulate market growth.

In the past years, sustainability and green practices in construction have become critical factors in determining investments in the sector, as ESG (environmental, social and governance) criteria have risen to the forefront.

The Business Manual talked about the current trends and challenges regarding sustainability in the construction industry with Vitaly Berezka, regional spokesperson for PlanRadar, a firm providing a tech platform for the construction sector.

How has the construction industry in Southeast Asia taken to the concept of ESG? Up to what extent have firms been adapting to these relatively new concepts to the region?

Southeast Asia’s construction sector has shown remarkable adaptability and enthusiasm towards ESG integration, driven by both growing regulatory frameworks and market demand. We have seen a marked increase in the adoption of green building standards, with firms integrating energy-efficient designs and materials into their projects. This shift is not just a trend but a transformative long-term movement, demonstrating the construction industry’s increasing commitment to environmental stewardship and the wellbeing of communities. 

This is supported by a strong commitment to social responsibility, including investments in worker safety and increasing integration of digital tools such as BIM (Building Information Modeling) for greater accuracy and project visibility. Construction companies and regulatory bodies are also enhancing their governance frameworks, ensuring greater transparency and accountability throughout the construction project lifecycle.

What trends in sustainability have you been seeing in the region, and specifically in the Philippines?

In Southeast Asia, and particularly in the Philippines, we have been observing a strong trend towards green building. Resources such as the Green Building Initiative, accreditation and EDGE certification programs have all contributed to this shift in recent years. 

This includes the use of sustainable materials, energy-efficient designs, integration of smart technologies and waste reduction measures. The Philippine government has been actively promoting green construction through incentives and regulations such as the BSP’s Sustainable Finance Framework, which has spurred many firms to adopt these practices.

These trends are indicative of a broader regional shift towards leveraging technology to achieve sustainability goals, demonstrating our industry’s innovative capabilities and forward-thinking approach.

What are the main challenges in getting the construction industry to accept the concept of ESG?

One of the main challenges in getting the construction industry to accept the concept of ESG is the initial cost and investment required for sustainable practices. Many construction firms, particularly smaller ones, may be concerned about the financial implications of adopting new technologies and materials. However, we are optimistic that as more success stories emerge, demonstrating long-term cost savings and increased efficiency, the industry will see ESG as a worthwhile investment. Education and awareness programs are also helping to shift perspectives, showing that the benefits of ESG extend beyond financial gains to include enhanced reputation and market competitiveness.

Another significant challenge is the need for a cultural shift within the industry to fully embrace ESG principles. Traditional construction practices are deeply ingrained in the region, and changing mindsets takes time. We believe that ongoing training and education are crucial in this regard, helping stakeholders understand the importance of ESG and how it can be integrated into daily site operations. 

Evolving changes to regulatory and compliance complexities can also pose a challenge in promoting ESG adoption in the construction industry. Navigating varying regional regulations and standards can be daunting for firms, particularly those operating across multiple jurisdictions. However, we are encouraged by the increasing alignment of international standards such as the World Green Building Council’s sustainable building certifications and local regulations such as the Philippines Green Building Code and amendments to the National Building Code, which simplifies compliance and fosters a more cohesive approach to ESG. 

What role does technology play in the change in mindset for the industry?

Technology plays a pivotal role in transforming the mindset towards more sustainable and greener building methodologies in the Philippine construction industry. Advanced technologies such as Building Information Modeling (BIM), AI-driven design software, renewable energy systems, sustainable construction materials, energy-efficient Heating, ventilation, and air conditioning (HVAC) systems, and smart building solutions allow us to design and construct buildings with reduced environmental impact, from design to build to operation. 

These innovations not only improve operational efficiency but also highlight the tangible benefits of sustainability, making it easier for stakeholders to see the value in adopting greener practices. As these technologies become more accessible, we are confident that they will drive widespread acceptance and integration of sustainable methodologies across the industry.

PlanRadar is a digital software-as-a-service (SaaS) field management platform for documentation, task management and communication in construction, facility management and real estate projects. Headquartered in Vienna, Austria, PlanRadar has 16 offices across the globe.