Organisations are part of and dependent on society. Increasingly society expects them to make positive contributions to them.
That means understanding how your operations and activities contribute to community welfare, support equality and impact the environment. The phrase “social value” has gained traction as business to business clients in particular make it a criteria for who they choose to work with.
We see this most often in tenders and funding bids. The Public Services (Social Value) Act came into force on 31 January 2013. It requires people who commission public services to think about how they can also secure wider social, economic and environmental benefits. In September 2020 a Government Procurement Policy Note (06/20) outlined how to take account of social value in the award of central government contracts.
The fundamentals
To consider yourself up to speed you need to understand your impacts, have targets, and a credible plan to get there. This is important at an organisational level, but also needs to be considered on contracts and bids you are making – what social value will you create if a contract or grant is awarded to you?
The key elements are:
- Tackling economic inequality – create new businesses, new jobs and new skills; increase supply chain resilience and capacity.
- Fighting climate change – effective stewardship of the environment.
- Equal opportunity – reduce the disability employment gap; tackle workforce inequality.
- Wellbeing – improve health and wellbeing (mental and physical); improve community integration.
The metrics
There are many. The good news is no-one expects you to address all the issues and have all the associated metrics. Good practice is to prioritise the topics that are most impactful and important for you and your stakeholders. Them measure those impacts and create an action plan which improves them – as a business and on specific contracts.
Common metrics by theme include:
| Tackling economic inequality | New jobs created
Apprenticeships created Nunber and value of contracts awarded to startups, SME’s, VCSE’s |
| Fighting climate change | People hours spent improving the environment
Reduction in GHG emissions, water use and waste arising from performance of the contract |
| Equal opportunity | Number and % of disabled people employed
% of people from under represented groups % of supply chain mapped for modern slavery risk |
| Wellbeing | % of supply chain with Mental Health at Work commitment
Number of people-hours volunteering and supporting other community-led initiatives, |
The benefits
A key one form many organisations is being bid and tender ready. Being able to include real examples of what you have already done on a topic reinforces your proposition in the eyes of the buyers or awarding bodies.
Prioritising social value, businesses can build stronger relationships with key stakeholders, particularly employees and the wider community. The benefits of these stronger relationships include employee retention and attraction as well as enhanced brand reputation. Done really well, it can make the community advocates for your organisation.
Increasingly regulatory requirements relate to social value topics. Understanding and proactively creating social value aligns organisations with current and future regulations.
So as an organisation you create social value. You may also have negative social value impacts. Understanding the drivers of it, prioritising the most significant ones and managing them in a coherent way enables long-term sustainability and profitability.