On this episode of REALtalk, REALPAC CEO Michael Brooks sits down with Refined Data‘s Hugh Molyneux and Carl Paulse to talk about environmental, health and safety (EHS) solutions for the real estate sector, challenges faced by the sector responding to COVID-19, and what the future of the space looks like.
The episode covers:
- The main challenges being faced by the real estate sector in keeping their buildings safe and compliant during COVID-19
- The structure and purpose of an EHS program
- Biggest challenges building owners face in implementing an EHS program
- Benefits arise from implementing a strong EHS program
- The evolution of the EHS, sustainability and governance space over the next 5 to 10 years
Hugh Molyneux is the President of Refined Data, which he co-founded in 2007 to develop Environmental, Health, and Safety (EHS) solutions for the real estate sector. Hugh’s degree is in environmental geology and prior to founding Refined Data his career spanned the assessment and remediation of contaminated real estate as well as developing brownfield sites.
Carl Paulse has more than 30 years experience developing enterprise-grade technology solutions. He joined Refined Data in 2015 and is now a full partner in the business. In his role as CTO, Carl has worked closely with Refined Data’s clients to create innovative technology solutions that ensure the Environment, Health and Safety agenda is addressed in a way that drives performance and increases NOI.
Michael Brooks (REALPAC): Hello, everyone, thanks for listening and welcome to REALtalk, the show that brings you unique insights from leaders in Canadian and international commercial real estate. I’m Michael Brooks, CEO of REALPAC. I’m pleased to be joined today by Hugh Molyneux and Carl Paulse. Hugh is the president of Refined Data, which he co-founded in 2007 to develop environmental, health and safety, which I am going to call EHS from here on, solutions for the real estate sector. Hugh degree is in environmental geology, and prior to founding Refined Data, his career spanned the assessment and remediation of contaminated real estate, as well as developing brownfield sites. Carl is the Chief Technology Officer of Refined Data and has more than 30 years experience developing enterprise grade technology solutions. He joined Refined Data in 2015 and is now a full partner in the business. Welcome, Hugh and Carl.
Hugh Molyneux (Refined Data): Thank you, Michael. It’s a pleasure and delight to have the opportunity to be with you here today.
Carl Paulse (Refined Data): Yeah, thanks for having us, Michael.
Michael Brooks (REALPAC): So today we are talking about environmental, health and safety in buildings, EHS for short, in the COVID age. We have another podcast on the cleaning and disinfecting of buildings in the COVID age, but now we move up into the big picture. Hugh, let me start with you. What do you think are the main challenges being faced by the real estate sector in keeping their buildings safe and compliant as we continue to deal with COVID-19?
Hugh Molyneux (Refined Data): Well, Michael, I think amidst all of the pressures and difficulties faced with all of us facing COVID, I think one of the good news stories has been Canada’s leadership in the development of protocols to reopen buildings in a safe and responsible way. If you look at the BOMA Canada Pathway Back to Work, it’s an example of Canadian leadership on the court in providing a practical and considered guideline around keeping buildings safe as and when we reopen. So I think we lead in setting some of the foundations in this area. I also think from an operations perspective, we have some of the best property managers in the world, and I think that adds to that foundation, so that we’re well set to safely reopen buildings when the time is appropriate. That having been said, Michael, I think the biggest challenge we’re going to face is boredom. I just speaking for myself and I see it around me, I think many of us struggle around getting a bit numb and complacent around following protocols, particularly as COVID drags on. So I think the top three challenges are going to be ensuring building occupants maintain social distancing and maintain the sanitation protocols over time that we’re all very familiar with. I think the second challenge will be directly related to managing the reopening of buildings because they’ve been inactive for long periods of time. And the kinds of things that you need to be cognizant of waste build-up the issues with pests, Legionella, and other waterborne bacteria, as well as mold and obviously structural issues as well, too. And then I think the final concern is this issue of the rising incidence of variants of the COVID-19 virus, because I think that that threatens to extend the lockdown and then that’s going to really exacerbate the first two challenges that we’ve talked about, you know, people maintaining the protocols and then also dealing with having buildings become active again and used. So I think those are the main challenges being faced right now, at least from an environment, health and safety perspective.
Michael Brooks (REALPAC): It’s really interesting, you know, I’ve almost forgotten about pests and Legionella and mold and those things that that, of course, we were concerned about pre-pandemic. They’ve all almost been pushed to the side, but they don’t go away. And, of course, we need to be focused on those. And the boredom piece. Oh, boy. I mean, we’re all we’re all in the boredom piece – I agree that the boredom can lead to some complacency. Carl, over to you. What does the program do and what are the biggest challenges building owners face in implementing any program?
Carl Paulse (Refined Data): Well, I guess I could state the obvious, you know, describe the acronym EHS and then stop and leave an awkward pause. But, you know, obviously there’s a much broader value statement than what the acronym represents. And some of the benefits have been surprising to us. And in terms of what the program does, people who share with us, the business continuity is one of the positive outcomes of a strong program, specifically in the way that it brings quality and consistency to the operational activities required to manage healthy, safe and compliant environments. That’s not what I would have considered when we first got into this business, I have to say. But in that regard, the EHS program becomes an integral element of a commitment to operational excellence. And that is a theme that we hear more and more often these days that while initially there was this focus on compliance and safety and the negative aspects, the preventative aspects of the EHS, it’s more and more become a focus on operational excellence, which has a much more positive image to it. But I think in the end, within the buildings, the program provides the operational playbook for a consistent delivery of safety and compliance. But at the portfolio level, it lays out the framework for managing risk, safety and compliance, both at scale, but also with consistent quality across large portfolios. And I think the other aspect of EHS programs that is important and strong programs is that the younger workforce has a much bigger expectation of a data driven and collaborative approach to performing their work and conducting their work. And strong engagement programs are unlikely to attract that younger talent in a way that the older, sort of more administrative approaches to NHS programs might not make as attractive.
Carl Paulse (Refined Data): So, you know, there are a number of benefits to programs that expand beyond those business benefits. But the challenges are equally interesting, Michael. One of our clients told us that a software vendor appears on their doorstep with the perfect software solution. That’s the day that their problems begin. And for a technology company that was a little deflating, I have to say, but he went to share that change management is a significant hurdle. And if I could pick only one challenge, that would be the one that they would focus on in this industry, particularly because of the geographically distributed site management workforce, which makes the onboarding or introduction of change so much more challenging than in many other disciplines and in other industries. Beyond that is the problem of enterprise grade data acquisition, which is where our focus was. And it was initially because again, that distributed nature of the sites makes it really difficult to collect and consolidate data into business insights. And if you’re fortunate enough to track this data acquisition problems, you still face the enterprise information framework where there’s this need to assemble accounting, leasing operations, EHS, ESG, tenant service provider data all into a unified data set that is aligned with key business performance indicators. So challenges are often nothing to do with features and functionality but the impact to the business. You know, coming back to the change management point.
Michael Brooks (REALPAC): That’s a really excellent point. And I guess that’s probably a challenge on the systematization portion of anything in a portfolio environment. And I get the objectives for senior management who want to move from a compliance approach to a best practice approach. And these types of platforms, including yours, would enable them to get there in a consistent basis, portfolio wide, regardless of who the who is using the tool, who’s accessing whatever the property managers, whether they’re in Nanaimo or Halifax, you know, you’re getting that consistent approach. Any other benefits that you haven’t mentioned, Carl, in implementing strong EHS program?
Carl Paulse (Refined Data): Well, that consistency is super important because in order to scale an EHS program, the consistency puts you in a position to identify the exceptions that need your attention. And so rather than managing 600 sites, you’re looking at 20 who have an exception dashboard for a very particular reason, so that you’re able to reach out and focus your attention to where you deliver the most value for your EHS program. So that ability to manage by exception has become crucial as a benefit in implementing these programs.
Michael Brooks (REALPAC): I’m also thinking that there’s got to be a risk management feature of this as well. If I’m a senior executive and I believe that I have a duty to provide a safe environment for my tenants and occupants of a building, I almost need to show that I have systematized my EHS approaches to discharge that obligation. So I’m thinking that that’s another important space. Which brings me to where do we go from here and here. Hugh, let me pivot back to you. How do you think the EHS and indeed sustainability and governance around that will evolve over the next five to 10 years? Where do we go from here?
Hugh Molyneux (Refined Data): That’s a great question. And, you know, you could answer it in so many ways, but I’m going to be disciplined and pick maybe three things. If you look, there’s been a fundamental change in mission in EHS, which has really been in the old days to move from compliance and reporting. And that’s very much evolved to the realization that a well executed EHS and sustainability and governance strategy actually adds value to the business and not theoretical value. There are demonstrated increases in productivity, clearly defined reductions in lost time to accidents, and, of course, the protection and enhancement of your reputation. We’re moving along the continuum, which really started in avoiding getting into trouble, to appreciation of the opportunity to generate real and measurable business value. So that’s the first thing. I think if you look at the automotive sector, which recognized years ago that as you move production out to parts suppliers, one of the key things to guard against is any loss of quality across your supply chain. And in our industry, more and more services are being outsourced to vendors that provide focused and specialized expertise, whether that’s facility management, snow removal, building maintenance, etc. So there’s now a big move from in-house siloed functions to this collaborative network, all working together as a team to run a high performance building. So the ability to maintain quality communication, collaboration is all critical and technology and software. I think a very important role in gluing teams together, keeping everybody on the same page and allowing for work to be passed back and forth between vendors and people and the approvals process, all the workflow having that be very seamless. And so I think that’s going to continue to grow. Finally, the model of worker protection and claims minimization is giving way to proactive tenant visits and employee wellness. And you can see that with the proliferation of new building health and wellness standards. And I see that doing nothing other than continuing to grow and expand in the coming years. So performance, collaboration and a holistic approach is foundational. And software is just obviously an important component in delivering all of that.
Michael Brooks (REALPAC): Very well, said, Hugh. And I’m also thinking about the return to the office mountain/behavioral mountain that many office owners will have to climb and instill confidence in their returning tenants and occupants that this is a safe place to come to and this will also be a plus. Carl, final words to you. Anything to supplement what Hugh has foreseen as drivers going forward?
Carl Paulse (Refined Data): Yes, Michael, I think the important thing going forward is that we’re seeing an increasingly creative use of space and began with the pressures of Amazon on retail. And then the pandemic just collapsed that window into a much more aggressive cycle of change for our industry. And I think as a result of that, rapid change systems in general has to be able to adapt and be flexible in meeting the needs far more so than they were even a year ago. And that will have to be reflected in the rate of change and adoption of technology and appropriate use of technology in the industry to meet those changing outcomes. That from the technology side is the exciting piece. I think it will get us to a place where we needed to be in a fraction of the time that it would otherwise have taken us to do so.
Michael Brooks (REALPAC): Well said. Those are great, great closing words. Thank you very much, gentlemen. I’ve been joined by Hugh Molyneux and Carl Paulse of Refined Data.
Hugh Molyneux (Refined Data): Thank you, Michael.
Carl Paulse (Refined Data): Thanks very much, Michael.
Michael Brooks (REALPAC): Well, this is Michael Brooks and that’s it for this week’s episode of REALtalk. Be sure to visit us at Realpac.ca/realtalk and subscribe wherever you get your favorite podcasts. If you have an idea for a topic or a guest, please send me an email at email@example.com. And if you like what you hear, give us a five-star rating. Thank you for listening and tune in next time.