Business

Over the last quarter century, case studies have documented the advantages of biophilic design, including improved stress recovery rates, lower blood pressure, improved cognitive functions, enhanced mental stamina and focus, decreased violence and criminal activity, elevated moods, and increased learning rates.

How do we take the evidence for these benefits and translate them to economics? In the past, research groups have reported various metrics of productivity including revenue, billable hours, net income, and market share gained. Current research uses both direct and indirect approaches.

Direct measures of productivity encompass quantifiable reported values, for example, the number of customers served or calls taken during a given time period. These metrics can be assigned monetary values in their respective settings and directly converted to cost savings for a company or institution. Indirect measures, although seemingly intangible and unquantifiable, are shown to have merit when examined in detail. Indirect measures of productivity include absenteeism, tardiness, hours worked, safety rule violations and other measures that add up quickly in a corporate budget (Miller, 2009). For this paper, indicators of productivity will include the following and will be translated into dollars where most applicable:

  • Illness and absenteeism
  • Job performance (mental stress/fatigue)
  • Classroom learning rates
  • Violence statistics
  • Staff retention
  • Healing rates
  • Retail sales

When linked to the effects of a renewed connection with nature, these metrics show remarkable gains, upon which companies and institutions can capitalize. Paying attention to biophilic design, not just as a luxury, but as a way to improve profits provides significant monetary benefits. In the pursuit of maximizing efficiency while minimizing costs, emphasis on worker productivity is extremely undervalued, because productivity benefits are not always immediately apparent, whereas cost reduction strategies are directly identifiable. A quandary arises for decision-makers who are attempting to balance shareholder interests with operational dynamics. An investment in employee workspace seems less fruitful than an investment in technology upgrades, where the rates of return are calculable. The myriad metrics that define worker productivity are rarely coordinated, making the payoff more difficult to quantify. Industries spanning a variety of sectors—from hospitals to corporate officesspend, on average, 112 times the amount of money on people as on energy costs in the workplace. This is precisely where the argument for biophilic design begins to pique the interest of business owners, superintendents, CEOs, policy-makers, and builders. Using 2009 values, the cost per square foot of a given corporate office space is overwhelmingly devoted to salary; 90.3% of costs per square foot are funneled towards salary, while only 8.9% is paid toward rent and mortgage, and just 0.8% represents energy costs (BOMA, 2010, US Department of Labor, 2010). These statistics make it clear that the smartest economic investment is an investment in employees, their productivity, and their overall satisfaction. Small improvements in productivity and reduced absenteeism could boost profits and the bottom line more dramatically than reducing energy costs. In short, productivity drives profit.

Schools

The classroom is perhaps the most influential environment outside the home where young students will experience rapid brain development and expansion in social skills. It is critical to infuse these learning environments with as many positive attributes as possible. In a 1996 study on student performance in daylit schools, with optimal daylight allowance from south-facing roof monitors that controlled sunlight to all major occupied space, attendance was found to increase 3.2-3.8 days per year compared with attendance at non-daylit schools. The cumulative value for three days of school for the estimated 633 students in the school district amounted to $126,283 in tax dollars that were not wasted through student absences (Nicklas & Bailey, 1996).

Student performance is another variable that can be influenced by biophilic principles. Across 17 studies from1934-1997, experts agreed that good daylighting “improves tests scores, reduces off-task behavior, and plays asignificant role in the achievement of students” (Kats, 2006). In the previous daylighting study by Nicklas andBailey, test scores increased between 5-14%. The greatest indicator linking test score improvements to day-lighting is the comparison with test score drops found in mobile classrooms in the same school district. Themobile, windowless classrooms saw test scores drop 17% in the same study period (Nicklas & Bailey, 1996).In the Capistrano, CA school district, students in classrooms with the most daylighting tested 7-18% higherthan those with the least. Furthermore, these students also demonstrated a 20-26% faster learning rate(Heschong, 1999). The greatest improvements were seen in classrooms with both daylight and windows allow-ing direct views of nature.

Retail Sales

The most extensive study linking daylighting to retail sales was conducted from 1999-2001 in a chain of 73 retail stores throughout California; 24 stores were categorized as having significant daylight illumination, whereas the remaining 49 relied on artificial light. A thorough analysisof sales reports showed, with 99% statistical accuracy, that non-skylit stores experienced a 40% increase in gross sales after the installation of skylights. The profit associated with the resulting increase in sales due to daylit areas was estimated to be at least 19 times greater than the energy savings. As energy costs for these stores were found to be $0.24 to $0.66 per square foot less than traditionally lit stores, depending on the complexity of the monitoring system installed, the profit from the sales increase, at $4.56 to $12.54 per square foot, far overshadows energy savings. The statewide effect for California if daylighting design was adopted on a mass scale in retail environments would be over $47.5 million in increased profits and $2.5 million saved per year in energy costs.

Resource Center

Active Daylighting

Energy Savings, ROI, Enhanced Human Performance: It’s All Possible

Biophilia Education

Biophilia, the innate human attraction to nature

Daylighting Pays!

Costs and Benefits of High Performance Daylighting Systems

Personnel Costs

Business Rational for Better Buildings

Retails Study Education

Skylighting and Retail Sales

School Study Education

Daylighting in Schools

The Economics of Biophilia

Why designing with nature in mind makes financial sense