Social value, what’s it worth?
Creating positive social impact and value is rapidly rising up the construction industry’s agenda. Alex Minett, Head of Products & Markets at CHAS, looks at what it means and discusses some of the challenges and opportunities of embracing a value approach.
The concept of social value isn’t a new one. Back as far as 1977, Social Accountability International established the SA8000 standard which has evolved into a framework to help organisations around the world to conduct business in a way that is fair and decent.
Initially, the concept of social value was associated with the workplace and business activity. However, over time this has expanded to take into account the wider impact businesses can have on people, communities, and the environment as a consequence of their activities.
This can be seen in the introduction of the government’s Construction Playbook, drafted in December 2020, which firmly sets out the expectations of the government when it comes to the delivery of public build projects to achieve “faster, better and greener builds”.
Specifically, Annex A of the playbook seeks to consider social value in the award of central government contracts under key themes in its social value model. Moreover, with BSI, the national standards body, also launching a new standard (BS 8950, Social value – Understanding and enhancing – Guide) to support the government’s social value agenda, social value has been catapulted from a consideration and ‘nice to have’ to something far more meaningful when it comes to project planning and procurement in public sector works.
However, it doesn’t stop there. Inevitably, the changes are starting to trickle down, and so too, the private sector is beginning to sit up and take notice.
What is Social value?
Social value is best described as the wider social, economic and environmental benefits that are derived from an organisation’s work or, through commissioning of services or procurement of goods. It strives to generate positive social impact, with changes that influence the positive wellbeing of individuals, communities, the environment and society in general.
In the public sector, businesses who seek to win government work now have a framework that they can use to strengthen their bids with a move away from solely trying to prove just financial value. They must now also demonstrate a more holistic proposition, attuned to the priorities of the communities in which they seek to operate.
Annex A of the construction playbook looks at five key themes as part of the social value model:
- Supporting COVID-19 recovery, including helping local communities manage and recover from the impact of COVID;
- Tackling economic inequality, including creating new businesses, jobs and skills, as well as increasing supply chain resilience;
- Fighting climate change and reducing waste;
- Driving equal opportunity, including reducing the disability employment gap and tackling workforce inequality;
- Improving health and wellbeing and community integration.
Embracing social value can be advantageous to businesses in a variety of ways. While the emphasis on social value in the public sector is garnering most of the attention, it doesn’t exclude the private sector which is expected to address some of the key themes through a tranche of new and proposed legislation, such as fines for non-compliance with transparency obligations in the Modern Slavery Act as well as plans to introduce mandatory climate-related financial disclosures for large private companies in an effort to drive forward the UK’s zero-carbon plan.
However, fear of financial repercussions is not the main reason to embrace social value. The commitment needs to be authentic, and creating a more responsible industry has its advantages for everyone. It gives businesses the ability to tap into happier, healthier and more diverse workforces who bring with them different skills and experience. While it also opens up opportunities to adopt new innovation and technology, which can influence supply chain resilience.
The chances are companies will reap both financial and reputational rewards as a business that puts social value commitments at the heart of its operations is likely to win more work and secure itself for the future.
Measuring the impact of social value is a challenge for many businesses, and it pays to remember that implementing social value is not one size fits all. Instead, each project needs to be reviewed on its own merit, finding the shared values that will most benefit a particular community and have a lasting impact.
Some of the barriers to adopting social value also sit with changing culture and mindset. Social value takes a collaborative effort, necessitating competitors to work together with the common goal of making society a better place.
It’s a big ask for businesses to rethink the way they operate, their overarching structure, and their value and the services they provide outside of just monetary terms. Where social value has previously been seen as a quantitative tick box exercise, the call to demonstrate social value accountability is becoming louder as it becomes something more clients demand.
This is where third party accreditation can have a real impact as it specifically addresses some of the core social value themes and can help provide evidence that it is an issue that is taken seriously throughout a company’s supply chain.
Social value is not going to go away. As the momentum keeps building, companies are looking at reliable ways to demonstrate they have adopted social value as a serious part of their infrastructure. The success of the Common Assessment Standard, which includes specific statements around social value, is an indication of an industry willing to embrace a more collaborative way of working, with an appetite to demonstrate social conscience. The onus is on the industry as a whole to continue promoting the adoption of social value and to keep driving it forward.
For further information on Corporate Social Responsibility in Construction, click here.
In this episode of the Safety & Health Podcast, we are joined by Tanya Jenke, General Manager of Cority Australia, who has recently carried out a study, analysing over half a million occupational injuries in Western Australia between 2003-2019, to find whether economic growth following a period of recession has an impact on workplace injuries.
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