The impact of the carbon tax policy on green building strategy

As Green Corporate Social Responsibility spreads across the globe, the construction industry is under pressure to reduce the carbon emissions across their building projects. Between maximum profit and environment management, mathematical programming can be used as a decision support tool concerning the optimal green building projects portfolio. This environment strategic decision problem is addressed in this study where an activity-based costing decision model incorporating carbon tax costs and construction resources constraints is developed from the perspectives of capacity expansion and green technology outsourcing. The results illustrate the positive contribution of the mathematical programming approach to achieve viable green building projects portfolio solutions. Sensitivity analyses are carried out to analyse the impact of carbon footprint emission variation on maximum profit, and the corresponding results are discussed.