The Rising Importance of Sustainability in Construction Contracts
March 17, 2025
Sustainability in construction contracts is becoming a defining factor for contractors, particularly those relating to government work. No longer just a box-ticking exercise, these construction sustainability certifications provide a measurable framework for reducing environmental impact, improving resource efficiency, and aligning with best sustainability practices. As infrastructure projects grow in scale and complexity, contractors must not only familiarise themselves with these certifications but actively integrate them into their business models to remain competitive in an evolving regulatory landscape.
Below are some of the key certifications that contractors should consider:
Infrastructure Sustainability Council (ISC) Rating:
The ISC rating system evaluates infrastructure projects based on sustainability performance across planning, design, construction, and operation phases. Accreditation involves training courses such as the IS v1.2 Design and As Built (D&AB) Accreditation—a one-day course priced at around $900. Participants must pass an exam to gain certification, which requires annual maintenance. Certification costs vary with project scope, ranging from $10,000 to over $100,000, covering registration fees, assessment costs, and ongoing compliance monitoring.
ISO 14001 Construction Environmental Management System (EMS):
ISO 14001 sets the standard for effective environmental management systems. It helps contractors minimise their environmental footprint by optimising resource use and waste reduction. The certification process includes developing an EMS, undergoing internal audits, and passing a certification audit by an accredited body. Costs range between $5,000 and $30,000, with certification typically taking three to six months depending on the size and complexity of the organisation.
Green Star Certification:
Administered by the Green Building Council of Australia (GBCA) or New Zealand Green Building Council (NZGBC), Green Star is a comprehensive, voluntary environmental rating system assessing the sustainability attributes of buildings and infrastructure projects. While traditionally applied to commercial buildings, Green Star principles are increasingly relevant to civil and earthworks projects. Certification can take between six and twelve months, with costs varying from $20,000 to $100,000, depending on project scale, design complexity, and assessment requirements.
Environmental Product Declarations (EPDs):
EPDs offer transparent, third-party-verified information about the life-cycle environmental impact of products. For civil and earthworks contractors, obtaining EPDs for key materials can strengthen sustainability credentials and, in some cases, be a requirement for government tenders. The process for a supplier of a product to obtain certification involves conducting a life-cycle assessment (LCA) and independent verification. Costs typically range from $15,000 to $50,000, with certification taking between six months to over a year, depending on data availability and verification complexity.
Different government agencies and councils have distinct sustainability benchmarks and compliance requirements. It is important contractors proactively engage with clients to understand these priorities and tailor their proposals accordingly. In Auckland, New Zealand, Watercare’s Enterprise Model promotes collaboration with construction partners to drive down carbon emissions and costs while enhancing safety and well-being. This model targets a 40% reduction in carbon emissions in infrastructure delivery, setting a precedent for sustainability expectations in major infrastructure projects but often leaving the way these targets are achieved up to the parties involved in the project (constructionaccord.nz).
Sustainability is no longer an optional extra, it’s a critical component of securing major contracts. These requirements are increasingly formalised through sustainability in construction contracts across major infrastructure and building projects. Contractors who invest in recognised sustainability certifications position themselves as industry leaders, demonstrating tangible commitments to environmental responsibility. By embedding sustainability into their operational framework, they not only improve their chances of winning tenders but also future-proof their businesses against an increasingly stringent regulatory environment.
*This article was written by Mutu CEO Ben Redwood and originally featured in Contractor Magazine
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