An Environmental Risk Management Framework for a Nordic Construction Firm

Abstract: Construction is one of the oldest of industries in the world, with the first establishedconstruction company being established around 230 BC. One of the biggest industries inEurope, at an estimated €900 billion a year, it also accounts for 40% of total energy consumption and 40% of total waste generation in the EU1 . Although the majority ofthese are from the use phase of the built environment, there is a lack of a comprehensiveenvironmental risk management system for the construction phase. This study proposesan environmental risk management framework based on the Beer-Ziolkowski model of risk management for both site specific and non-site specific construction operations witha stakeholder centric approach. It proposes stakeholder involvement to identify the risksaided with trend analysis of strategic regulatory implications from the concernedauthority - Norwegian Ministry of Local Government and Regional Development and thecurrent orgnisational practice of objective environmental risk identification from ISO14001 guidance. Scope of site specific and non-site specific risks are narrowed down tosite operational setup and construction materials respectively, consistent with theorganisations view of the most important risks from those two classes of risks. Riskassessment is suggested through Fault Tree Analysis (FTA) method for site specific risksand European Union System for the Evaluation of Substances (EUSES) for non-sitespecific risks. Total Cost Accounting (TCA) of project alternative evaluation isrecommended with a view to internalise the external costs. A two tiered integration ofrisk information in the buisess process is suggested – categorised risk reduction processat the level of projects and general good practice aided with risk information at the policylevel. Being a framework for management of environmental risk as opposed to a methodfor a specific environmental risk, the principles and suggestions are broadly scoped withcase studies for identification and analysis of risks.Through the practice of prudent engagement of stakeholders and scientific risk assessments, this framework would help the organisation enable safer operational practices in the context of environmental effects. In foresight this in turn will have rendered the host firm more competent in terms of making sustainable business decisions.