A research proposal to improve the environmental performance of the building industry by increasing the innovation activity of small contractors

The World Building Council for Sustainable Development has singled out the building industry as an urgent problem where there are ‘large and attractive opportunities’ to reduce energy use at a lower cost and higher return than other sectors, given an appropriate investment in innovation (WBCSD, 2009, 1). Focus on the building industry is critical as it is the single largest contributor to climate change (UNEP, 2014, 16). It is the biggest consumer of energy amongst end-use sectors, and generates more greenhouse gas emissions than the transport sector (IPCC, 2014b, 47, IPCC, 2014a, 21-23). A shift to more sustainable building is seen as an essential part of urban renewal focused on reduced environmental impacts. Such a shift will require significant innovation, yet the building industry is renowned as an innovation laggard, rated second-last amongst all 17 Australian industries (ABS 8158.0, 2014). An exciting opportunity for fast-tracking innovation leading to sustainable buildings has been discovered by the research team. Through this study, they will divert attention given to large firms and iconic projects, where change is ponderously slow and impacts are marginal, to small contractors where change can be adopted much more rapidly and where major impacts are much more likely. The role of small contractors is significant. In fact, 98.5% of all Australian contractors are small, employing less than 20 people; yet they generate nearly half of the industry’s output and employ 62% of workers in the industry (ABS 8155.0, 2015, ABS 8165.0, 2015). Small contractors provide the most efficient lever for improving the sustainability of buildings. Small contractors are ubiquitous specialist intermediaries in the building industry, linking product manufacturers and distributors with building owners and users. From an innovation system’s perspective, the critical role of small contractors is clear; they hold a strategically important position within the industry and represent a focal point in the innovation system where the benefits of improved innovation activity to support environmental objectives would have strong multiplier effects. This role has not previously been examined in any depth, particularly with regard to environmental sustainability. The paper outlines a robust research proposal to address this gap in the literature.