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Eco-friendly Buildings on the Rise: Why Building Products Matter

Published on Nov 07, 2024

Eco-friendly buildings are crucial for sustainable development, addressing the growing need for urbanization while minimizing environmental impact. These structures are developed to optimize energy efficiency, enhance air quality, and reduce water consumption with the use of eco-friendly materials and innovative techniques.    

Eco-friendly buildings help: 

  • reduce energy consumption by 20–30 percent 
  • lowering water usage by up to 50 percent  
  • minimizing waste and nurturing healthier living environments 

The benefits of eco-friendly buildings extend beyond the environment; they have been shown to raise property values by up to 10% while also reducing operational costs and improving occupant productivity and well-being. For the construction sector, transitioning to eco-friendly building practices is important for reducing environmental impact and promoting sustainable development. 

Read more: Sustainability-Related Risks are Critical Business Metrics. Why?  

What are Eco-friendly Buildings?  

Eco-friendly buildings incorporate environmentally friendly measures and are resource-efficient. The eco-friendly buildings concept aims to completely minimize the negative impact while maximizing the positive impact a building has on the natural environment and human occupants. 

As a holistic approach to planning, design, construction, and maintenance, eco-friendly buildings help in successfully maximizing natural efficiencies and integrating them with low-carbon technologies to support energy needs as well as to create a healthy built environment.  

Areas of priority in an eco-friendly building are as follows:   

  • efficient use of water, energy, and other resources  
  • quality of the indoor environment 
  • impacts of the building on the natural environment 

Understanding the negative impacts in the built environment further helps develop new approaches and technologies to enhance all aspects of a building’s performance. Eco-friendly buildings are required on a global scale to help reduce greenhouse gas emissions drastically, as well as to conserve increasingly stretched energy resources and contribute to enhanced human health. 

Sustainable Framework

Benefits of Eco-friendly Buildings 

Eco-friendly buildings help reduce negative impacts on the environment. They employ renewable energy sources and materials, reducing emissions and other waste. They even have a net-positive impact on generating energy or increasing biodiversity.  

Implementing eco-friendly building measures leading to these performance benefits also helps create economic benefits for different stakeholders. Better buildings are more attractive to business owners as well as occupants due to their environmental benefits, enhanced comfort, higher efficiency, and lower operating costs. This further positively impacts occupancy levels. Construction and development firms benefit from higher property values due to optimized resource utilization as well as longer-lasting buildings. 

Read more: Top Companies with the High ESG Risk Rating Score 

The huge industry and job creation around eco-friendly building development is continuing to grow. Studies show that people who work in an environment with improved eco-friendly buildings realize benefits across areas like work performance and sleep quality. 

Eco-friendly Buildings Affect Planet, People and Profits  

Eco-friendly buildings generate significantly lower greenhouse gas emissions when compared with non-green buildings. As per the World Green Building Council, green buildings use almost 25% less energy than non-green buildings in the US. Eco-friendly buildings also help in addressing the triple bottom line of planet, people, and profits. 

Eco-friendly buildings benefit the planet by decreasing the environmental footprint of the built environment through energy-efficient methods and renewable sources. In addition to using less energy, eco-friendly buildings minimize water and resource usage, integrate waste reduction measures, and decrease private vehicle use. Vertical gardens and green roofs further contribute to improving air quality and lowering indoor temperatures. 

Eco-friendly buildings offer numerous benefits to people. Innovative building designs that feature indoor greenery, optimal use of natural light, and airflow can lower blood pressure and anxiety. Clean air enhances productivity and mood, while natural materials like wood and stone help alleviate mental health conditions. 

Eco-friendly buildings also support profits. They are increasingly cost-effective due to developing supply chains and technologies. Their cost premium relative to non-green construction has narrowed, offering stricter building codes for all structures. The lower operating expense, together with minimal long-term maintenance costs, further helps in enhancing their marketability and potential to command higher rents and sale prices. 

Read more: Exploring the Impact of Climate Finance Taxonomy on Global Markets 

Buildings account for almost 30% of global energy consumption, with even higher rates in regions like Europe. With the global population forecast to grow in the coming decades, the sustainable development of the built environment is important to reduce the sector’s long-term energy consumption and emissions. This underscores the critical need to adopt sustainable practices and meet net-zero targets. 

Eco-friendly buildings offer a new way and open opportunities to achieve these sustainability goals. Considering businesses from the building products industry in an investment portfolio can display a forward-looking strategy from the standpoint of financial returns as well as support the transition towards nurturing a more sustainable environment. 

Eco-friendly building

Key Highlights 

  • The building products industry includes companies involved in the manufacture, sale, and installation of materials, devices, and components that together form new, completed buildings.  
  • The world’s growing population is driving a new demand for eco-friendly buildings, making current construction and development decisions critical in shaping the trajectory of energy consumption and emissions.  
  • Compared to other regions, Europe is setting the pace regarding sustainability solutions driving revenue growth. It hosts the largest number of enterprises that derive over half of their revenues from sustainable solutions. 
  • Assessing companies from the building products industry in an investment portfolio can also help demonstrate a forward-looking strategy from the standpoint of financial returns as well as support the organization's transition towards building a more sustainable environment. 
  • The transition to eco-friendly buildings also aligns with the growing market expectations and requirements to mitigate climate risks as well as to increase resilience against extreme weather events. 

Read more: Disclosure v. Diversity Washing: Reflecting on the Critical Components in Reporting  

Final Thoughts 

As the eco-friendly buildings sector is evolving and maturing at a steady pace, the industry is gaining more support from formal regulations, standards, and incentives. However, the challenges are continuing to refine those mechanisms and practices. The introduction of new technologies is set to represent and guide the sector ahead. Since their introduction, eco-friendly buildings have helped significantly reduce building sector energy consumption and environmental impact. 

However, there is an opportunity for further advancement and added pressures to accommodate the ongoing global growth while balancing the economics of eco-friendly buildings. To keep up with the growing pace as well as to make additional progress, further innovation is required across areas such as energy and water conservation, indoor air quality, and construction management. 

A leader in ESG Services, SG Analytics offers bespoke sustainability consulting services and research support for informed decision-making. Contact us today if you are in search of an efficient ESG (Environmental, Social, and Governance) integration and management solution provider to boost your sustainable performance.        

About SG Analytics  

SG Analytics (SGA) is an industry-leading global data solutions firm providing data-centric research and contextual analytics services to its clients, including Fortune 500 companies across BFSI, Technology, Media & Entertainment, and Healthcare sectors. Established in 2007, SG Analytics is a Great Place to Work® (GPTW) certified company with a team of over 1200 employees and a presence across the U.S.A., the UK, Switzerland, Poland, and India.        

Apart from being recognized by reputed firms such as Gartner, Everest Group, and ISG, SGA has been featured in the elite Deloitte Technology Fast 50 India 2023 and APAC 2024 High Growth Companies by the Financial Times & Statista. 


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