Sustainable Payment Mechanisms in Construction: A State-of-the-Art Review of the Security of Payment Laws in Commonwealth Countries

Legislative payment security measures in the construction industry face sustainability and ethical challenges, particularly in balancing the needs of subcontractors and main contractors. This study provides a state-of-the-art review of the sustainability of security-of-payment laws in the United Kingdom and four Commonwealth countries: Australia, New Zealand, Singapore, and Malaysia. This study investigated key sustainability dimensions grounded in ethical principles—specifically, stakeholder and equity theories—using the Green Project Management (GPM) framework, which outlines three sustainability criteria: effectiveness, fairness, and efficiency. A comparative thematic analysis was then conducted to evaluate security-of-payment measures identified from the legislative frameworks of these countries. This study found four key mechanisms: (1) enforcement of clear payment terms to address late and nonpayment issues; (2) enhanced clarity and expedited adjudication processes; (3) remedies for late and nonpayment; and (4) establishment of trust accounts and related mechanisms to ensure payment security. These mechanisms promote ethical business practices but face disparities in implementation and enforcement that hinder sustainability outcomes. This study contributes to the existing knowledge by revealing key sustainability dimensions grounded in stakeholder and equity theories, identifying common security-of-payment measures across legislative frameworks, and synthesizing these insights to evaluate payment security mechanisms. This study also develops a guided framework to align payment practices with sustainability and ethical principles, offering actionable recommendations for policymakers and industry stakeholders.