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Project Sponsor Group Handbook, Version 2, 06/12/12
Authorship
Friends and colleagues would like to remember with affection Bárbara Galanes-Álvarez who passed away
after a sudden and short illness following her preparation of this handbook. Her friendship, hard work and
ability to light up the lives of others will be remembered always.
Bárbara Galanes-Álvarez 1982 - 2012
PROJECT SPONSOR GROUP HANDBOOK
2
CONTENTS
1. INTRODUCTION.....................................................................................................................3
2. CONTEXT...............................................................................................................................4
3. PROJECT SPONSOR GROUP MEMBERSHIP......................................................................6
4. PROJECT SPONSOR GROUP RESPONSIBILITIES.............................................................8
5. PROJECT SPONSOR GROUP MEETINGS .........................................................................12
6. FINANCIAL MANAGEMENT OF BUILDING PROJECTS ....................................................14
7. PERFORMANCE MEASUREMENT .....................................................................................23
8. PROJECT QUALITY REVIEW PROCESS ...........................................................................29
9. SUSTAINABLE BUILDINGS PHILOSOPHY ........................................................................32
Supplementary Documentation
ANNEX A - Capital Projects Initiation Process
ANNEX B - RIBA Schedule of Work
ANNEX C- Strategic Guidance for Sustainable Buildings Philosophy
ANNEX D - PSG Standard Agenda Template
PSG Standard Minutes Template
PSG Project Manager’s Report
ANNEX E - Donor Funded Governance
ANNEX F - Benchmark Template
ANNEX G - Project Expenditure Approval form
Project Initiation Document
Guide to Capital Projects
Estates Regulations
PROJECT SPONSOR GROUP HANDBOOK
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1. INTRODUCTION
This Handbook has been produced following a Buildings and Estates Subcommittee (BESC)
working group report which reviewed the role and functioning of project sponsor groups (PSGs).
See BESC(10)155 and BESC(10)175 for further details.
Section 4.1.4 of the Estates Regulations issued by BESC states that “BESC shall appoint a Project
Sponsor Group to manage a major project and shall appoint the group’s chairman“. Major projects
have a total gross value of at least £100k (all funding sources and VAT are included in this figure).
The purpose of the PSG Handbook is to provide a reference and guidance document for all Project
Sponsor Group members. It contains sections on the membership of the group, including the
responsibilities of each member plus the group as a whole. It also outlines the format of meetings
and documentation that will be provided to PSG members. Other sections cover financial controls,
use of contingency, tendering processes, governance structure for donor funded projects and
environmental sustainability.
The PSG Handbook should be read in conjunction with the Guide to Capital Building Projects
(http://www.admin.ox.ac.uk/estates/regspols/) produced by Estates Services, for use by University
departments. Both of these documents are supplemental to the Estates Regulations, issued by the
Buildings and Estates Subcommittee (http://www.admin.ox.ac.uk/estates/regspols/) which define the
management requirements of capital projects.
PROJECT SPONSOR GROUP HANDBOOK
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2. CONTEXT
A Project Sponsor Group is responsible for managing a project on behalf of the University. This
includes responsibility for financial control of the project within the approved budget and for ensuring
that the outcome satisfies the needs of those who will occupy and maintain the premises. A detailed
schedule of responsibilities can be found in section 3 of this document.
The diagram below indicates the reporting responsibilities of a Project Sponsor Group in relation to
the Buildings and Estates Sub-committee (BESC) and the Planning and Resource Allocation
Committee (PRAC).
PRAC – prepares and reviews annually the University’s five-year plan, as informed by the plans of
Divisions and the services, advises Council on the use of capital funds, and considers advice from
BESC on allocation of land and property in the functional estate.
CSG – reviews feasibility proposals and proposals for capital projects on behalf of PRAC. In
particular it ensures that any proposed business case uses appropriate financial assumptions and
space standards, have the approval of the relevant bodies, and is consistent both with the capital
priorities of the division in question and with the Capital Plan
BESC – is responsible to PRAC for management and maintenance of the functional estate, except
for matters that are the responsibility of divisions, CSG, or other bodies.
In particular, BESC:
Advises PRAC on the allocation of land and property in the functional estate
PROJECT SPONSOR GROUP HANDBOOK
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Oversees the repairs and maintenance programmes undertaken by Estates Services
Makes recommendations to PRAC concerning the strategic development of the functional
estate taking into account institutional plans and environmental, planning, and heritage
issues
Oversees the initiation and management of all major projects.
PROJECT SPONSOR GROUP HANDBOOK
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3. PROJECT SPONSOR GROUP MEMBERSHIP
Section 4.1.4 of the Estates Regulations defines the Project Sponsor Group membership:
a person nominated by the department on whose behalf the project is being undertaken
a person nominated by the division to which the department belongs and
a person nominated by the Director of Estates
Larger projects might need more than one departmental representative, if this is the case, the
department will carry only one vote on Project Sponsor Group meetings.
Project Sponsor Group membership, including the Chairman, is always approved by BESC.
The Project Sponsor Group shall include in attendance:
the designated Project Manager (mandatory)
an Estates Services Project Support Officer or Secretary appointed by the PSG to take
meeting minutes if required
any additional individuals required (for the entire meeting or part), e.g. consultants or the
Client Representative, at the discretion of the group; formally agreed and invited by the
Project Sponsor Group Chairman.
In the event of not being able to attend a scheduled meeting a PSG member shall nominate a
proxy who has delegated powers of representation and the authority to make decisions at
the meeting. Where this is not possible, the Chairman will determine whether the PSG
should be rescheduled.
The nomination of both the divisional representative and the departmental representative should
have regard to the following:
the nature of the project and therefore the experience required
the time commitment involved
the possible need to release the person concerned from other duties
the requirement for the representative to be able to achieve consensus within the
department or division and speak on behalf of the department or division in matters relating
to the project
make decisions at the meeting on behalf of the department and users.
It is proposed that, for large complex or high profile projects, the practice of appointing a Client
Representative might be adopted. The Client Representative might be also serve as the divisional
or departmental representative on the PSG, or might delegate this representation to another person.
Where a need for a Client Representative is identified, consideration should also be given to the
PROJECT SPONSOR GROUP HANDBOOK
7
extent to which (if any) a ‘buy –out’ of that person’s time is required to enable the project to be given
due attention. The need for a Client Representative should be agreed between the Chairman of the
PSG and the Chairman of BESC. Where a buyout is deemed necessary, the Chairman of PRAC
should be consulted, and appropriate costs built into the project budget.
PROJECT SPONSOR GROUP HANDBOOK
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4. PROJECT SPONSOR GROUP RESPONSIBILITIES
4.1 RESPONSIBILITIES - PROJECT SPONSOR GROUP
The Project Sponsor Group shall be responsible for:
Managing the risks associated with the project
a) overseeing the selection process for the design team and making recommendations to
BESC if required under regulation 4.4.4 of the Estates Regulations
b) considering the procurement method and making a recommendation to BESC if required
under regulation 4.4.3 of the Estates Regulations
c) drawing up a list of contractors to be invited to tender and making a recommendation to
BESC if required under regulation 5.4.5 of the Estates Regulations
d) reviewing the tenders received and making a recommendation to BESC if required under
regulation 5.4.8 of the Estates Regulations
e) monitoring construction, approving any variations in design, and authorising any commitment
against contingency funds
f) approve the Project Initiation Document and Project Expenditure Approval form
g) ensuring every project complete the Project Quality Review Process (PQRP)
h) ensuring every project complete the Key Performance Indicator (KPI) and Benchmark
processes
i) sign off the project design at key gateways (including Feasibility, RIBA stage C, RIBA stage
D, approval of Employers requirements and Contractors proposals)
j) discussing and agreeing the need and nature of any internal and external consultations that
are required, and ensuring they are communicated to BESC
k) signing off the final space allocation drawings as soon as this is possible in order to confirm
that the information regarding occupation is correct
l) provide neutral challenge to the project delivery team.
4.2 RESPONSIBILITIES – PSG CHAIRMAN
The Project Sponsor Group Chairman shall be responsible for:
a) allocating and recording the individual responsibilities of PSG members where they
differ from those listed below
b) ensuring the agenda and associated papers are issued to all group members (in
collaboration with the Project Manager) no later than 4 working days prior to the meeting
c) ensuring the minutes of the last meeting are confirmed and accepted as a fair
representation of the discussion at the meeting
d) ensuring that any reports presented at the meetings are formally approved
e) ensuring that decisions made at meetings are clearly articulated and recorded
f) discouraging members from reopening discussions on point which have previously
received thorough consideration
PROJECT SPONSOR GROUP HANDBOOK
9
g) strictly curtailing discussions on matters left to project teams or working groups to
resolve
h) agreeing and formally inviting additional attendees to the meetings
i) arbitrating between Project Sponsor Group members’ conflicting opinions
j) reviewing any information that is additional to the Project Manager’s report and deciding
whether it should be tabled at the next meeting
k) ensuring changes to the PSG membership are endorsed and formally approved by
BESC
l) ensuring each PSG member receives a formal letter of appointment specifying their
responsibilities as a PSG member.
4.3 RESPONSIBILITIES - PSG DIVISIONAL REPRESENTATIVE
The Project Sponsor Group Divisional Representative shall be responsible for:
Exercising financial control of the project using the information provided in the Project
Manager’s reports, in particular the cost update
a) considering value for money when exercising financial control of the project
b) maintaining close scrutiny of, and justification for, the level of contingency
c) providing up to date fundraising information directly liaising with the development office
when applicable
d) ensuring the academic and finance control of the project ties in with divisional strategy.
4.4 RESPONSIBILITIES - PSG DEPARTMENTAL REPRESENTATIVE
The Project Sponsor Group Departmental Representative shall be responsible for:
Ensuring that the project meets the needs of those who will occupy and maintain the
building in question by taking an active role in developing and refining the brief, working
closely with the end users, Project Manager and lead designer as the detailed design
develops
a) serving as the primary point of contact between the department and the design team.
4.5 RESPONSIBILITIES - PSG ESTATES SERVICES REPRESENTATIVE
The Project Sponsor Group Estates Services Representative shall be responsible for:
Monitoring the project programme provided in the Project Manager’s report to ensure that
this remains on target
a) being the point of contact for BESC
PROJECT SPONSOR GROUP HANDBOOK
10
b) ensuring that the PSG carefully review the information presented by the project managers,
making sure that all relevant red flag issues are agreed by all PSG members and recorded
accordingly
c) ensuring that the Project Manager fulfils his responsibilities to the PSG by monitoring
performance and compliance with the Estates Regulations and the Guide to Capital
Building Projects, and referring any issues to the Head of Capital Projects
d) maximising the environmental performance of the building by monitoring the
implementation of the relevant Estates Regulations on environmental sustainability
e) overseeing the commissioning and acceptance of the building and handover to its
occupant
f) ensuring every project undertakes the Project Quality Review Process
g) ensuring every project completes the Key Performance Indicator and Benchmark
processes as required.
4.6 RESPONSIBILITIES - PROJECT MANAGER
The formal responsibilities of Project Manager are set out in detail in the Capital Projects Handbook.
A brief general outline follows:
a) Under the supervision of the Head of Capital Projects, the Project Manager is
responsible for selecting and procuring the services required for the project in
accordance with standing orders
b) The Project Manager works closely with the departmental representative to establish the
project brief and translate it into a preliminary specification that is refined as the project
progresses
c) At all stages the Project Manager, with the lead designer, ensures that the
specification is fully explained to the departmental representative
d) The Project Manager devises the programme for the project’s various stages so that
statutory approvals are achieved and construction work can proceed. The
programme must be approved by the PSG
e) The Project Manager guides the PSG in considering options for procuring the
construction work
f) The Project Manager may act as the Contract Administrator for the building contract
g) The Project Manager is responsible for implementing a change management process so that
the PSG can ensure that costs stay within budget
h) The Project Manager is responsible for managing and reporting the costs provided by the
cost consultant
i) The Project Manager places orders and authorises payments
j) The Project Manager makes regular reports to the PSG (at least four days before
each meeting), the headlines of which are incorporated in regular capital project reports to
BESC
k) At the end of the project, the Project Manager ensures that documentation required for the
management of the building and its integration into the estate is delivered
PROJECT SPONSOR GROUP HANDBOOK
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l) The Project Manager maintains the project’s electronic and paper records and ensures that
correct document templates are used as specified in the Capital Projects Handbook
produced by Estates Services
m) The Project Manager ensures that stage sign-offs and final project reviews are conducted
and that lessons learned from projects are recorded
n) The Project Manager will ensure that the project will be developed according to guidelines
set out in the Capital Projects Handbook
o) The Project Manager will agree with the PSG members the schedule of the Project
Sponsor Group meetings
p) The Project Manager will keep a schedule of decisions made by the PSG
q) To ensure continuous improvement, the Project Manager will ensure compliance with and
participation in the Project Quality Review Process in order that issues are resolved in a
timely manner and lessons learnt from projects are recorded and communicated
r) The Project Manager will ensure compliance with and participation in the Key
Performance Indicator (KPI) process ensuring relevant parties record KPIs in a timely
manner
s) The Project Manager will ensure the recording of benchmarks at the stages defined in the
benchmarking process.
PROJECT SPONSOR GROUP HANDBOOK
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5. PROJECT SPONSOR GROUP MEETINGS
A meeting should take place each calendar month unless the Project Sponsor Group agrees to do
otherwise. As a minimum, meetings should be scheduled to cover the following critical project
events:
Agree project proposal
Agree feasibility scope
Agree architect selection
Feasibility Study sign-off
Agree procurement terms and funding for main project
Stage C sign-off
Stage D sign-off
Agree contractor tender list
Agree consultant tender lists
Accept building at handover
Approve final account
Review KPIs (quarterly)
Review benchmarks (each stage)
In each case a meeting timetable shall be agreed and recorded at the outset. The Project Manager
is responsible for organising all Project Sponsor Group meetings.
The generic agenda for all PSG meetings is as follows:
Matters arising and approval of minutes from previous meeting
Project Manager’s report to PSG
Client matters
Benchmarking
KPIs
Red flag issues
Funding
Any other business
Report sign-off
Date, time and venue for the next meeting
The Project Manager’s report shall contain the following:
Executive summary
Design update
Progress update
Programme and milestones
Procurement
PROJECT SPONSOR GROUP HANDBOOK
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Cost update
Sustainability update
Benchmarking
KPIs
Risk and red flag issues
Client decisions
APPENDICES
A. Minutes of previous meeting
B. Programme
C. Cost Summary
D. Fee Schedule
E. Risk Register
F. Schedule of decisions
G. Report Sign-off Sheet
The report must be issued in its entirety ahead of the PSG meeting. Any subsequent information
that becomes available should be forwarded to the Chairman who will decide whether it should be
tabled at the meeting.
Project Managers will brief the PSG Chairman prior to any PSG meeting, highlighting any critical
decisions to be made by the PSG.
Only new or updated information should be presented to the PSG in order to avoid duplication and
repetition.
Project Managers will issue reports and associated papers a minimum of four working days
before a meeting, and will issue minutes to the PSG Chairman for approval no more than five
working days after each meeting. PSG Minutes must be approved by the PSG Chairman prior to
circulation to the PSG members. All reports, papers and minutes will be issued electronically unless
the PSG agrees otherwise.
The PSG members including the PSG Chairman will be asked, at the end of a PSG meeting, to
sign-off the information presented by the project manager and any deviations discussed at the
meeting. This sign off is formally recorded in the Project Manager’s report to the PSG.
PROJECT SPONSOR GROUP HANDBOOK
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6. FINANCIAL MANAGEMENT OF BUILDING PROJECTS
The following is a brief process summary of the financial management of capital building projects.
More detail can be found in the Guide to Capital Building Projects. See also the RIBA Outline Plan
of Work.
Initiate project
New building projects must be discussed with the relevant Division & Estates Services to
ensure the work complies with divisional strategy and is technically viable.
Project Sponsor Group (PSG) formed.
Nominated Estates Services Project Manager completes a Project Initiation Document (PID)
with support from the PSG. Funding elements detailed on the Feasibility Expenditure
Approval (FEA) part of the document.
Feasibility Proposal (parts A & B of the PID) submitted to CSG/PRAC for approval.
Feasibility study
The Feasibility Expenditure Approval (FEA) is sent to Estates Services finance and Capital
Accounts for set-up of the project on Oracle Financials.
A Feasibility Team appointed by Estates Services carries out the feasibility study.
At the end of the study, a Feasibility Report is written detailing the possible options to be
considered by the PSG/Estates Services.
Project proposal
The departmental representative completes a Project Proposal, including the financial PEA
and VAT forms, with support from the PSG.
The completed Project Expenditure Approval form (PEA) must be authorised by the
department, division, Estates Services and any other parties contributing funding.
Complete Project Proposal submitted for Capital Steering Group consideration
The approved PEA is sent to Estates Services finance and Capital Accounts for set-up of the
project on Oracle Financials.
Pre-project initiation review held (stage 1 of PQRP).
Manage contracts, requisitions & invoices (Estates Services)
Tender process carried out resulting in formal contracts.
Pre-construction review held (stage 2 of PQRP).
Requisitions / Purchase Orders are raised as per the Purchase to Pay process.
Invoices are logged and reviewed against receipted works and appropriately authorised.
PROJECT SPONSOR GROUP HANDBOOK
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OUFAL managed projects (if relevant)
Where the project is to be managed via Oxford University Fixed Asset Ltd (OUFAL) the
contract, requisition and invoice process (as above) is managed through the OUFAL
accounting system.
Reporting
On a monthly basis reports reviewing spend are generated by the Capital Accounts team for
review and discussion with the Project Manager.
Management reports are generated for BESC (Building & Estates Sub-Committee) and
PRAC.
Manage claims (Capital Accounts)
All claims are managed as required by the Capital Accounts team.
Complete project
At ‘Practical Completion’, subject to documentation being in order, contract retention
payments are released. At this point the building becomes a University asset.
Post project evaluation held (stage 3 of PQRP).
Defects-liability period starts, during which time phase one of the post-project evaluation
takes place.
Once the final valuation is received and the Making Good Defects certificate produced, the
final retention amount is released.
Where further works are required the Project Manager generates a report detailing the
requirements. This ongoing work is reviewed as required and funding documentation
appropriately amended.
Reconcile project
The Project Manager reconciles the award against Invoices and addresses open Purchase
Orders.
Project Closedown Form (PCF) completed.
As required finance must refund/fund relevant projects as per PRAC guidelines before
changing the status of project to ‘Closed’.
Post occupancy evaluation takes place (stage 4 of PQRP).
PROJECT SPONSOR GROUP HANDBOOK
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6.1 FINANCIAL CONTROLS
The University’s Financial Regulations state that all non-research building projects must be
appraised, implemented, and monitored in accordance with the University's Financial Management
of Building Projects process.
The Project Manager has overall responsibility for ensuring that expenditure on a University capital
project is effectively managed within approved budgets and funding.
The key financial controls that must be complied with are:
All capital projects must be reviewed and authorised in line with the process; the project
funding must be established and agreed; and approval for the project to go ahead given by
the appropriate authorities in accordance with Financial Regulations
Project expenditure follows the University regulations and processes for purchasing and
expenses incurred, and is continually monitored against budget and funding.
6.2 VAT
The University is sometimes entitled to claim certain VAT reliefs on some capital building projects
(see table below). Most of the time the University has to pay VAT on capital building projects but
sometimes it can recover part (and very occasionally all) of this VAT from HM Revenue & Customs
(HMRC). Whether VAT is payable to suppliers and, if so, whether any of that VAT can be recovered
from HMRC, can have a considerable impact on the project’s budget. Therefore, it is vital to get
advice from the University’s Taxation Team in order to ensure that any appropriate VAT reliefs are
used correctly and, if VAT is payable, that it is costed into the project at an early stage.
The Taxation Team require detailed information about what the project entails and how the finished
building or refurbishment etc. will be used by the department(s) occupying it. The Project VAT
Review form (PVR) has been designed to capture as much of this information as possible. The
Project Manager should complete a PVR in conjunction with appropriate departmental user
contacts, including as much information requested as possible and send it to the Taxation Team.
The PVR should be completed and sent to the Taxation Team as early as possible to help
budgeting for VAT as necessary. The Taxation Team will make any further enquiries necessary
PROJECT SPONSOR GROUP HANDBOOK
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(which may include contacting the departments involved, asking to review plans, and possibly
meeting to discuss complex projects) and then complete the advice section of the PVR.
Code Rate %
charged
by
supplier
% of VAT
recovered
VAT %
charged
to
project
Description
ZZZ 0 0 0UK zero-rated, exempt or outside the scope of
VAT
ZMD 0 0 0 Zero-rated medical items (special rules)
SVX 20 0 20 UK standard rated supply, non-recoverable
SVR 20 12 17.6 UK standard rated supply, partially recoverable
SVF 20 100 0 UK standard rated supply, fully recoverable
SCG 20 12 17.6UK standard rated supply, partially recoverable
under the Capital Goods Scheme
6.3 CONTINGENCY
Section 4.4.7 of the Estates Regulations states that:
“A level of contingency appropriate to the form of contract for a major project must be included in
the project budget. Normally, a contingency sum of 10% of the construction cost should be
available when the construction contract is awarded. The Project Sponsor Group must retain
control of the contingency and must not delegate that control to the design team.”
This has been further defined and approved by BESC (BESC(10)189):
The PSG’s obligation changes as a project evolves as follows:
15% at feasibility
10% from RIBA stage C onwards
5% at the point of agreeing a contract sum (assuming the usual design and build
procurement route)
From this point onwards, the PSG’s authority for any individual release of contingency is restricted
to the lesser of:
a) 10% of the contingency agreed at the point the contract was agreed, or
b) £100,000
PROJECT SPONSOR GROUP HANDBOOK
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Any proposed individual approval above these levels requires the approval of the Chairman of
PRAC and the Chairman of the Sub-committee, subject to a minimum amount of £10,000. Any
proposed expenditure related to scope change requires similar approval.
These levels of contingency are recommended, however, they should reflect the levels of risk
identified in the project: the higher the level of risk, the higher the level of contingency required. On
complex projects or those with numerous risks there are various risk management tools available to
the PSG in order to assess and analyse risks.
6.4 PROJECT RISK MANAGEMENT
For each project it is important to:
Review existing risks identified to date
Identify new/emerging risks
Prioritise risks using a qualitative scoring mechanism
Identify and put in place risk response actions
Assign ownership of risk response actions
Before starting any complex and high-value project it is considered good practice to run an initial
‘risk workshop’ facilitated by a specialist external consultant.
Project Risk Areas
The following categories should all be considered (as a minimum) when identifying specific risks:
client issues
funding
planning / listed building requirements
statutory authorities
design
procurement
construction
commissioning and handover
other risks which may impact the project’s objectives
PROJECT SPONSOR GROUP HANDBOOK
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Risk Identification and Evaluation
The probability of the risk occurring can be evaluated as follows:
Scale
Value of
Occurrence Likelihood Code Range (%)
1 Very Low Virtually impossible VL 0% -5%
2 Low Low but not impossible L 6% -20%
3 Medium Fairly likely to occur M 21% -50%
4 High More likely to occur than not H 51% -80%
5 Very High Probably will occur VH 81% -99%
The impact of the risk occurring can be evaluated in terms of cost and/or time delay:
Scale Impact on cost/time Code
1 Very Low VL
2 Low L
3 Medium M
4 High H
5 Very High VH
Risk Ranking
The risks identified are ranked in order of priority using a “Black, Red, Amber, Green traffic light”
system, providing a qualitative indication of the impact of the risk on cost and time. The
multiplication of a risk’s probability score with the highest of either its cost or time scores enables
the risk to be ranked, with the highest priority risks shown as “Red Risks” and the lowest priority
shown as “Green Risks” (as shown below). Probability x impact = risk rank
Probability Risk Rank
VH 5 10 15 20 25
H 4 8 12 16 20
M 3 6 9 12 15
L 2 4 6 8 10
VL 1 2 3 4 5
Impact VL L M H VH
PROJECT SPONSOR GROUP HANDBOOK
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“High Priority” risks could have a significant consequence on the successful outcome of a project
and it is essential that PSGs ensure response actions are applied to these key risks. It is
recommended that an ongoing risk management process is implemented in order to track risks and
response actions and report findings to the PSG in order to track the management of risks and to
minimise the impact of the risks on the project.
NOTE: ‘Red Flag’ is defined as any issue that requires immediate action, whereas red risks
might not require immediate action but need to be flagged so that the relevant individual or
University body is made aware. Any item which remains as a red risk is likely to become a
red flag issue.
Red flag issues vary extensively between projects. Example of red flag issue: project main
contractor filing for administration.
Mitigation
It is essential that all mitigation measures are developed, implemented and monitored throughout
the project life-cycle to ensure that risk mitigation actions are effective and the exposure to risk is
understood as the project progresses. It is important to:
Ensure all mitigation actions are developed and implemented by the project team
Undertake regular risk reviews/updates as part of project progress/team meetings
Review migration/operational risks to identify any additional project risks which require
management under the project
Identify and record additional risks identified through the procurement process by sub
contractors
Identify and implement Mitigation Action Plans for major risks
Implement a formal risk procedure for the on-going management of risks throughout the
project life-cycle to identify, mitigate and monitor risks to the project
Focus on mitigating the key Red risks
Risk Register
Each risk identified should be included in the project Risk Register which is reported to the PSG by
means of the Project Manager’s report. The register contains a description of the risk together with
the current assumptions on the probability of the risk occurring, its consequential impact on the
project, and any measures taken to mitigate its impact.
PROJECT SPONSOR GROUP HANDBOOK
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6.5 TENDERS
Section 5.4 of the Estates Regulations lists the instructions that apply to the placing of all orders,
contracts or commissions. The approvals procedure for tendering is summarised in ‘Standing orders
for tenders’ (document 32.0 of the Capital Projects Handbook) – see table below. Distinction is
made between contracts estimated to be valued £10k-£500k and those over £500k.
Amount of contract, sub-
contract or order
£500,000 and over £10,000 - £500,000
Number of tenders Agreed by the Director of Estates
List of tenderers approved by BESC Director of Estates
Tenders opened byThree members of the Tender
Panel* appointed by BESC
Two members of the Tender
Panel
Approval of tender other than
the lowest byBESC Director of Estates
Award of contract by Director of Estates
Amount of contract,sub-contract or order
£100,000 andover
£10,000 - £100,000 £10,000 - £25,000
Approval of singletender action
BESC Director of EstatesDirector of Capital
Projects
*The Tender Panel comprises: the Chairman of BESC, the Vice-Chairman of BESC, the Secretary
of BESC, an officer nominated by the Director of Finance, the Director of Estates, the Head of
Capital Projects, the Head of Conservation and Buildings, the Head of Building Services, the
Estates Strategy Manager, and the Capital Projects Administrator.
6.6 DONOR FUNDED PROJECTS
The following is an extract from a BESC report to PRAC (PRAC(10)158aR) proposing a new
committee structure for donor-funded capital projects:
It is … proposed to create a new group, the Design Review Forum (DRF), for projects where there
is a substantial donation from a single benefactor, and where the benefactor wishes to take a role in
the development of the project. The DRF would have a significant role in establishing design
aspirations; assisting in the selection of design teams and architects, and reviewing the design as it
develops throughout the project … In all instances the DRF would be responsible for making
recommendations to the PSG … It is anticipated that the DRF would meet regularly with the design
teams, cost and planning consultants etc., and act as advisors on design matters to the PSG … The
PROJECT SPONSOR GROUP HANDBOOK
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Sub-committee recommends that, as part of the new structure, it be stipulated that neither donors
nor their representatives should be appointed as members of a PSG.
The table Committee structure for donor-funded capital projects (Annex E) illustrates this.
PROJECT SPONSOR GROUP HANDBOOK
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7. PERFORMANCE MEASUREMENT
Estates Services is committed to developing a performance management culture to drive
continuous improvement throughout the estate. In delivery of projects, this will be through two key
areas:
Performance Benchmarking
Key Performance Indicators (KPIs)
7.1 Performance Benchmarking
Estates Services has established a set of benchmarks in conjunction with other leading university
establishments. It is intended that the PSG to monitor performance against a pre-established
baseline and a project target figure. At the end of each project these benchmark indicators will be
incorporated into the performance matrix for the whole of Estates Services.
The PSG may decide to define, measure, and monitor additional, project-specific benchmarks which
can be added to the register although it is not envisaged that this will be appropriate for all projects.
The benefit of this is to provide a structured approach across the whole estate and to allow specific
areas to be monitored, for example, on unusual or complex projects.
The benchmarks against which targets will be set at project initiation are:
Benchmark Description Source of Data
Capital cost per m2
Cost of construction, including net building costs, maincontractor costs, contractor overheads and profit andinflation divided by the gross internal area in m
2 note 1.
Cost consultant
Net project cost per m2
Cost of construction, includes net building costs, maincontractor costs, overhead and profit, fees, other projectcosts and inflation but excludes contingency and VAT,divided by the gross internal area in m
2
Cost consultant
% Total consultant fee spend Expressed as a percentage of construction costsnote 2.
Cost consultant
% Architect fee spend Expressed as a percentage of construction costs Cost consultant
Space efficiency Net to gross, this being the net usable area divided by thegross internal area in m
2and expressed as a %
Architect
Space usageTeaching sub-category
Space usage by teaching expressed as % of net internalarea following omission of services and circulation
Architect
Space usageResearch sub-category
Space usage by research expressed as % of net internalarea following omission of services and circulation
Architect
Space usageSupport sub-category
Space usage by support expressed as % of net internalarea following omission of services and circulation
Architect
Design occupancy Net usable area in m2
of gross internal area per staff andstudent FTE, visitors omitted
Architect
Water consumption (m3) per
student and staff FTETotal m
3of water used annually per student and staff FTE Mechanical & Electrical
design consultant
Total water consumption(m
3) per year
Total m3
of water used annually Mechanical & Electricaldesign consultant
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Benchmark Description Source of Data
Building CO2 output kg CO2 produced per m2
of gross internal area per year,CO2 output calculated from electricity, heat and gasconsumption only
Mechanical & Electricaldesign consultant
Total CO2 output kg CO2 produced per m2
of gross internal area per year Mechanical & Electricaldesign consultant
Energy consumption kWh of energy consumption per m2
of gross internal areaper year, energy consumption calculated from electricity,heat and gas consumption only
Mechanical & Electricaldesign consultant
Total energy consumption kWh of energy consumption per m2
of gross internal areaper year
Mechanical & Electricaldesign consultant
Note 1. Contingency % allowance may reduce with successive stagesNote 2. Includes cost of surveys and architect fee spend
At the end of the project feasibility stage the PSG will set the core benchmarks targets from the list
above along with any additional specific improvement metrics if necessary. These will be
communicated to the design team upon appointment. The PSG will own the development of the
benchmarks, using data provided by Estates Services and will be responsible for assessment
during the gateway stages. Quantitative data will be provided be the Project Manager during the
gateway stages.
7.2 Key Performance Indicator Evaluation Process (KPI Process)
Aims
Continuous improvement Quantitative and qualitative consultant, contractor and supply chain evaluation Identification and commendation of exceptional performance Timely identification of issues and resolution during the project process Compliance with adopted 2010 audit recommendations
Introduction
The University and particularly Estates Services is committed to continuous improvement across itscapital projects, project teams and supply chains. The present paper describes a formal KeyPerformance Indicator evaluation process which will further facilitate continuous improvement.
The KPI process is a whole life project process of evaluating project key performance indicators andteam key performance indicators throughout, and following, the design and construction of newbuildings or facilities, as well as the refurbishment of existing buildings and facilities.
There are a wide selection of project, contractor and consultant KPIs with the potential formeasurement, however, any KPI used routinely within Estates Services capital project processneeds to be consistent, unequivocal, realistically measureable, auditable, and of value. In particularthe KPI should inform the reviewer, enabling action to be taken or decisions to be made.The objective of the KPI evaluation process is to inform Project Sponsor Groups (PSGs) andEstates Services with regards to the achievement of agreed KPIs and project delivery teamperformance. On the basis of the indicators reported, the PSG or Estates Services may then takeaction to correct failings in the project delivery or note exceptional performance. The KPI processwill also assist the University in the process of contractor or consultant selection and general supply
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chain management. Further, implementation of performance monitoring is an audit requirementstemming from the 2010 audit of the Estates Services.
Estates Services will routinely evaluate the performance of the following team members against theKPIs: Architect, Building Services (M&E) Engineer, Client Representative, Contractor, PlanningConsultant, Project Manager, Quantity Surveyor/Cost Consultant, Structural/Civil Engineer andSustainability Engineer.
Methodology
The KPI evaluation process has four key elements:
Agreement of project Key Performance Indicator targets at project outset by the PSG In project Key Performance Indicator evaluation at project gateways Post project evaluation of Key Performance Indicators against agreed targets Quarterly Key Performance Indicator 360 degree evaluation of project team members
The Estates Services has selected a concise set of KPIs, referencing previous stakeholderconsultation, and agreed a balanced scorecard approach with the following categories: Process,Finance, Environmental, Personnel and Client Satisfaction. The scorecard is weighted towardsProcess and Client Satisfaction in order for project teams to demonstrate consistent high quality andcorrect project delivery. The KPIs against which targets will be set at project initiation (end of RIBAStage B) are:
Category Key Performance Indicator
Client satisfaction Average time taken to close out defects *Average Post Project Evaluation scoreAverage Post Occupancy Evaluation score
Environmental Energy consumption (MWh/m2/year) (gas, electricity and heat)
%, by weight, of construction waste sent for recyclingFinance % of contingency utilized
% variation between budget and predicted or actual final accountPersonnel Accident/incident rate per number of man hours worked
Considerate Contractors scoreProcess Progress against programme (days behind or ahead of schedule expressed as a %)
% of required reports delivered on timeNumber of defects at 1 month post practical completion *
* Not adjusted for relevant scale of individual defects, caution required during interpretation
The KPI process commences at the completion of RIBA stage B with the setting of targets againstthe KPIs detailed above by the PSG, it is the Estates Services PSG representative who retainsresponsibility for ensuring that this action is undertaken.
Estates Services recognizes that while some of the KPIs are contractor - or consultant - specific (forexample, % of required reports delivered on time) others are a measure of project teamperformance attributable to all team members whose role influences the indicator (for example, theprogress against programme indicator). The balanced scorecard indicates whether scores are teamscores and therefore recorded against those team members with the ability to influence themeasured parameter, or are individual scores.
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Post Project KPI evaluation
The post project recording element of the KPI process is the recording of the final, as delivered,
post project KPIs. The Project Manager will have responsibility for collating the data and entering it
onto the online project specific balanced scorecard. The balanced scorecard will be presented to
the PSG against a narrative provided by the Project Manager which will set out additional comment
or explanation, including details of mitigating circumstances where required. The data will be
reviewed by the PSG which will, taking into account all factors, agree a traffic light indicator of
performance using the following scale: red – performed poorly; amber – performed below standard;
green – performed well; blue – performed exceptionally well. Such information will be used to
inform ongoing contractor or consultant selection and encourage project team, contractor or
consultant improvement for future projects.
In Project KPI evaluation
To add value to the KPI evaluation process a second element is the on-going evaluation of KPIs
during the project process. Performance against the initial targets will be evaluated throughout the
project at project gateways (plus one additional stage at the end of RIBA stage J). The process
works as above, with the project manager compiling the Key Performance Indicators via the online
project specific balanced score card for presentation to the PSG, who in turn will apply the colour
coded system. This will allow rapid identification when a performance score falls below the
acceptable level and the implementation of corrective measures is necessary. The process would
also identify exceptional performance, enabling the recognition of success in a timely manner. The
traffic light definition system for this process is defined as follows: red – urgent action required;
amber – warning; green – on target; blue – exceptional performance to be commended. It is the
Estates Services representative’s responsibility to ensure this is undertaken. Again, such
information will be used to inform ongoing contractor or consultant selection and encourage project
team, contractor or consultant improvement.
It is recognised that some of the twelve KPIs are not obtainable until practical completion, or indeed
sometime after and the availability of data evolves with the project as the project progresses and
contractors are appointed and the appropriate stages undertaken. It is possible at Gateway 2 to
formally record just two KPIs, those of milestone achievement against program and % of required
reports delivered on time, while by Post Occupancy all twelve KPIs will be measurable. Accordingly
a revised balanced score card is provided for the in-project process.
360 degree feedback model
The third element of the KPI evaluation process is the performance evaluation of the project team.
It is recognized that many of the KPIs are dependent on the performance of the team, delivered as
a result of the team effort and therefore a measure of the team. The processes described above
are heavily weighted towards indicators of team performance, while audit requirements have
significant interest in the evaluation of the performance of the Estates Services supply chain in the
form of individual contractors and consultants. This will enable individual performance appraisal,
enable timely resolution of problems, provide further opportunities for improvement and identify
exceptional performance.
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The third element is a qualitative analysis of team performance via analysis of peer group project
team opinions and experiences, utilizing a 360 degree feedback model. The 360 degree evaluation
is a common tool for evaluating performance, based on feedback from other team members. Each
project team consists of the nine principal team members identified above. The proposed process
involves each team member being required to rate the performance of the other team members
using the criteria detailed in the online reporting tool on a quarterly basis, beginning at the start of
RIBA stage C.
Data collected is summarised in a composite report (Appendix D with explanatory text shown in
Appendix E) which generates an automatic traffic light colour coding which quickly identifies a team
member’s performance ranging from red, indicating very poor, to blue, indicating excellent. The
data is reviewed by the Project Manager prior to submission to the PSG in order that details of
mitigating circumstances or other comment or explanation may be added. The data will be
reviewed by the PSG which may take action or request the Project Manager to take action as
necessary. The Estates Services representative on the PSG will be responsible for conveying
concerns and/or commendations to the Director of Capital Projects & Property Management or the
Head of Capital Projects to enable exceptional performance to be noted, or team performance
issues addressed in a timely manner.
Output
Each evaluation will produce a data set, either in the form of the balanced score card or the 360
degree composite report, and will be entered on a database held within Estates Services. In
addition the results will be deconstructed and the data entered into a supply chain database in order
that contractors and consultants may be evaluated for performance across all projects in which they
have participated. The database will be able to be interrogated to determine trends. Consistent
throughout the process is a continual review and improvement cycle, whereby the supply chain is
continually reviewed against original aspirations and the team reviewed for performance in order
that any unjustifiable deviations or problems may be addressed in a timely manner ensuring quality
is maintained and improved.
Anonymity
It is intended that the 360 degree feedback composite report will be anonymous although the
University will recognise any legal requests for release of data. Information will be stored securely
and held in accordance with the University’s Data Protection policy:
http://www.admin.ox.ac.uk/dataprotection/policy/
Ownership
The Project Manager has responsibility for ensuring that data is gathered and the balanced score
cards are completed on schedule and presented to the PSG. The Estates Services representative
on the PSG has responsibility for ensuring that the results of the evaluations are reviewed by the
PSG and grade where required. In addition the Estates Services representative has responsibility
for conveying both performance concerns and commendations to the Head of Capital projects as
appropriate.
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Stages in summary
End of RIBA stage B – setting of KPI targets by PSG
Project Gateways 2 to 6 plus additional stage at end of RIBA Stage J – In project KPI
evaluation
Quarterly following project initiation – 360 degree feedback model evaluation of project team
End of RIBA Stage L – Post project KPI evaluation
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8. PROJECT QUALITY REVIEW PROCESS
Aims
Continuous improvement
Learning for the next project
Timely identification of issues and resolution during the project process
Affirmation of initial aspirations, continual review and redirection
Improved communication
Project ownership
Introduction
The University and particularly Estates Services is encouraging continuous learning from capital
projects whereby issues identified during the project process are addressed in a timely manner
before project completion, and the benefits of lessons learned are passed on to other projects. The
aim is to foster a culture of continued review and problem resolution, and constructive feedback
within the project teams and amongst the client representatives, consultants and contractors who
work within it, with the intention of improving the efficiency and effectiveness of the delivery process,
therefore ensuring the high quality of the resulting project.
The PQRP is a whole life project process of evaluating the design and construction of new
buildings, and the refurbishment of existing buildings whilst actively involving a wide group of people
who have responsibility for delivering the project, who will occupy the resulting construction or have
some form of responsibility for the building. The process involves four key stages, Pre-Project
Initiation (PPI), Pre-Construction Review (PCR), Post Project Evaluation (PPE) and Post Occupancy
Evaluation (POE). Each stage is equally valuable and to be afforded equal focus and effort.
The Project Quality Review Process is primarily concerned with reviewing and improving delivery by
undertaking continual:
Process Evaluations
Operational and Functional Reviews
Technical and Performance Reviews
The emphasis at each stage evolves throughout the project. At the start of a project the PQRP is
primarily concerned with reviewing, and if applicable adopting, lessons learnt from previous projects
including both problems encountered (and their mitigation) and project successes. Additionally, at
the start of a project, the focus is one of developing and agreeing the brief and aspirations and
conveying this to the team. As the project evolves the emphasis evolves to one of recording
lessons learnt for the benefit of others and to one of checking the brief and aspirations are being
met, to finally verifying the functional and technical performance against the original brief. The start
of the project sees the building of a team and adoption of best practice from lessons learnt with
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regards to process. This then evolves through stage review of team performance to a final review of
team performance and onward communication of any lessons learnt.
Consistent throughout the process is a continual review and improvement cycle, whereby the
project is continually reviewed against original aspirations and the team reviewed for performance in
order that any unjustifiable deviations or problems may be addressed in a timely manner ensuring
quality is maintained or improved.
Methodology
The PQRP provides a tool to assess the design quality of buildings and the project process,
adopting lessons learnt, identifying problems and resolving them and passing lessons on to
subsequent projects. The process follows a clear structure that is linked to RIBA stages of a building
project, as well as OCG gateways and other processes including the KPI and benchmarking
exercises. At each stage there is a questionnaire gathering of data and a workshop where issues
are discussed and actions agreed.
Output
Each stage will produce a formal report detailing the findings of the review and the agreed action
plan to ensure problems are addressed or project successes implemented. In addition the
information gathered at each stage will form part of the output, including copies of presentations
given and the findings of the surveys. The output of each stage also evolves throughout the
project. At the start of a project the output will focus on the aspirations and brief as well as the
lessons to be adopted from other projects both good and bad. As the project evolves the output will
record progress against the original aspirations and brief and detail problems highlighted by the
surveys and workshops and the plans for resolution. The output of the final stage will formally
record achievements against the original brief and lessons learnt on the project, both good and bad
for subsequent projects. The final output takes the form of a case study detailing the project,
benchmarking and lessons learnt.
The Teams
The PQRP requires a team who will see the project and process through from the initial stages to
post occupation. A PQRP team takes ownership of the project, and as well as professional
membership requirements, certain members have other key roles such as the end user
representatives who have key role in communicating aspects of the project through to their
departments and encouraging participation in the Post Occupancy Review. The following teams
have been designated for PQRP purposes:
The Client Team represents those that are responsible for determining requirements and
aspirations and those that will use the building or be affected by it and will have
responsibilities for the building function, operation, maintenance or safety. This will also
involve Stakeholders who have an active interest in the project as a result of their
requirements to discharge their own responsibilities.
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The Project Team represents those who are responsible for the design, construction and
delivery of the building.
The teams are made up of the following team members:
Client Team Membership Project Team Membership
Project ManagerChairman, Senior Academic or Principal InvestigatorDepartment Facilities ManagerEnd User RepresentativesArea Safety OfficerDisability Advisory ServiceEquality & Diversity UnitInsurance OfficeEstates Services Asset and Space ManagementEstates Services Direct Labour OrganisationEstates Services Director of Capital Projects and PropertyMaintenanceEstates Services Electrical Maintenance ManagerEstates Services Estates Strategy ManagerEstates Services Facilities ManagerEstates Services Head of Capital ProjectsEstates Services Head of ConservationEstates Services Mechanical Maintenance ManagerEstates Services Project Support OfficerEstates Services Sustainability ManagerSafety OfficeTelecommunications & DataVAT OfficePSG Membership
Further Participants and ContributorsEnd Users and Occupants (at POE stage)
Project ManagerArchitectCost ConsultantStructural EngineerMechanical EngineerElectrical EngineerCivil EngineerSustainability EngineerFire EngineerLandscape ArchitectEcologistSecurity AdvisorBREEAM AdvisorPlanning ConsultantCDM CoordinatorAcoustic Consultant
Client Team Members as appropriate
Further Participants and ContributorsMain Contractor (at PCR, PPE & POE stages)Principal Subcontractors (at PCR, PPE & POE stages)
Ownership and Facilitation
Each stage is owned by the Project Manager or the Head of Capital Projects. The workshop is
facilitated by the Project Manager for the first two stages (PPI and PCR), as these are primarily
learning stages. The Head of Capital Projects, or his Deputy will facilitate for the final two stages
(PPE and POE), as these are primarily review stages and must remain objective and independent
although an external facilitator may be appropriate in some cases.
The information gathered will primarily be available to the University and participants in the project.
Stages in Summary
There are the following four stages to the PQRP:
Pre-Project Initiation
Pre-Construction Review
Post Project Evaluation
Post Occupancy Evaluation
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9. SUSTAINABLE BUILDINGS PHILOSOPHY
A new Sustainable Buildings Philosophy Document (SBPD, please see Annex C) ) was approved by
the Sustainability Steering Group, BESC and PRAC in December 2011. The purpose of the SBPD
is to help the University meet the aspirations of the sustainable buildings section of its
Environmental Sustainability Policy 2008 (see extract below). In addition, all energy and carbon
reduction work in the University is guided by the Carbon Management Strategy approved by Council
in January 2011. This document was written to meet HEFCE requirements and it defines the steps
that the University has taken and will take in future to achieve a reduction in its CO2 emissions.
SUSTAINABLE BUILDINGS – The University of Oxford Sustainable Buildings Policy is to
build environmentally sustainable buildings, and embed sustainable building best practice into
the management of the Estate. The University will ensure that any new building or
refurbishment is planned, built and occupied to ensure the greatest energy and water
efficiency and lowest carbon emissions that are reasonable in the circumstances. The
University is committed to making full use of its existing buildings and, wherever possible when
expansion is necessary, to the development of sites within walking or cycling distance of the
remainder of the University.
The SBPD is a suite of four documents which as a whole is intended to provide information to a
number of participants, including Project Managers and Project Sponsor Groups around new build
or major refurbishment projects being undertaken by the University such that sustainable
development issues are considered appropriately and are outcome focused. The document suite
comprises:
Guidance for Project Managers
Strategic Guidance for PSGs
Scoping Questions
Sustainable Aspirations Map (SAM)
The core purpose of the SBPD is to ensure that, as far as is possible, University capital projects
result in the delivery of low CO2 buildings in-use. This important focus on operational energy
consumption and CO2 emissions represents a shift in focus from compliance (i.e. Part L Building
Regulations) to outcomes (i.e. actual in-use efficiency) and should result in better performing
buildings in terms of CO2 emissions.
In addition to this focus on CO2, the SBPD addresses a range of broader sustainable development
issues across the following topic areas:
Passive design techniques:
Building orientation
Building depth
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Natural ventilation
Daylighting
Construction methods and materials Green building elements (roof, walls)
Construction waste
Local ecology (protection, enhancement etc)
The overall intention is that future building projects will assist in the realisation of the various
sustainable development objectives set by the University and, in particular, play their part in
reducing CO2 emissions.