Balfour Beatty said this week it would use sustainability as a key differentiator in its future efforts to win new business.

In 2010, Balfour Beatty estimated that baseline revenues of recognised sustainable goods and services (such as LEED, CEEQUAL, BREEAM, clean energy) amounted to 22% of total revenues. The Group also established in 2010 that 4% of new projects initiated during the year had agreed sustainability deliverables with the customer.

The company has now started to track and capture data on its profitable markets and plans to continue to systematically track both indicators as measures of its effectiveness in growing Group revenues through sustainability.

Balfour’s plans to address the multi-billion pound opportunities from low-carbon business include the establishment of an Energy Forum to research and develop its approach to maximising new commercial opportunities across the Group. These include offshore wind, carbon capture and storage, waste from energy facilities, new nuclear and developing the transmission network.

Sustainability is key differentiator in winning new business

Commenting in its latest sustainability report, the Group said:

“As we operate across the infrastructure lifecycle, we have a major opportunity to influence the direction of the emerging sustainability agenda to help grow our business. During 2010, we increased our efforts to influence across a range of topics from low-carbon refurbishment to ecology. “

Balfour Beatty believes that influencing the market to adopt more sustainable outcomes will help the long-term growth of its business, commenting:

“Differentiating our services through sustainability will help us to win work in existing markets and capitalise on new business opportunities in the multi-billion pound low-carbon and resource-efficient economy.”

The company said it would seek to influence a more sustainable approach to the provision of infrastructure by targeting research and thought leadership on key issues such as carbon and emerging ones such as water.

The Group has a clear focus on using sustainability as a means to gaining competitive advantage in key markets. By October 2010, 28% of its businesses had incorporated sustainability into their marketing materials, while the remainder will do so by the end of 2012.

Key sustainability initiatives undertaken by Balfour include the development of a sector action plan to reduce water use in the construction process and work with the Department for Environment, Food and Rural Affairs (DEFRA) on the concept of habitat offsetting as part of the government’s White Paper on the Natural Environment due in Spring 2011.

Supply chain sustainability key part of plans

In 2010, the firm began the process of transforming its procurement and supply chain activities following a Group-level strategic review in 2009 with consultants PricewaterhouseCoopers. This included the development of Project GrACE, the Group’s strategic procurement programme, which identified a number of key strategic spend categories and incorporated a ‘heat map’ approach for assessing the sustainability risks and opportunities within the categories.

The Group said its supply chain plays a critical role in helping to deliver a sustainable Balfour Beatty - acknowledging the importance of procurement in driving the necessary change with the establishment of a Sustainable Procurement Group.

Other work included the development of a sustainable procurement toolkit and clearly defining a set of consistent sustainability questions for use within supplier pre-qualification processes.

Among key activities planned by Balfour Beatty is further work with suppliers to embed sustainability within the Group’s supply chain. By 2012 Balfour Beatty will expect all its key suppliers to be conversant with its 2020 sustainability vision.

Balfour Beatty will also use its supply chain to help improve its understanding of indirect (Scope 3) carbon emissions through the materials and services it procures in delivering projects.