Real estate has a very real role to play in contributing to social value in the UK. Whether it be public realm enhancements, supporting people into the industry, including social enterprises in supply chains, increasing local spend and so on, there’s an increasing need for developers and asset owners to demonstrate and capture social value. And it goes without saying that social value is a core component of ESG.
Social value in major projects
Many local authorities are now requiring major projects are able to demonstrate social value. And we’re seeing this in bidding for government contracts more generally.
For example, in England, taking account of social value became a requirement in major government contracts including for construction and infrastructure projects from 1 Jan 2021. This is in addition to new and emerging requirements for carbon reduction plans.
Capturing social value
In this context, demonstrating and capturing social value is critical when developing an approach to Environment, Social and Governance (ESG) considerations. But capturing what it means and how it is valued is complex. Another layer of complexity is that in the UK, each country (England, Scotland, Wales, Northern Ireland) has a different approach to measurement.
Again in England, social value is determined via giving a monetary value by proxy. This is included in the Themes, Outcomes, and Measures (TOMs) framework. Many companies are now looking to use this framework to capture social value – to communicate to clients and their supply chain as well as investors and occupiers.
In working with real estate clients, while putting a £ sign next to social value can be important, there’s also a need to capture those elements that can’t effectively be monetised and this is where qualitive data becomes critical. I’ll be writing more on this in future posts.
Nations’ approaches
Here I wanted to provide a brief overview of the approaches taken in each country with links to relevant policy documents and frameworks.
England
- Public Procurement Note (PPN) 06/20 – Taking account of social value
The note sets out how to take account of social value in government procurement using the social value model.
The TOMs Mapping Tool is an approach for social value that includes all components of the central government’s Social Value Model and shows how these can be aligned to a set of Key Performance Indicators (KPIs). The aim is to provide consistency of defining, measuring, reporting and monitoring social value.
A useful document for understanding policy/procurement priorities. This is updated periodically.
Wales
The note provides provide public sector bodies in Wales with advice on the Welsh Government’s overarching policy objectives and the reporting of outcomes in relation to social value clauses/community benefits. The contracting authority determines the requirements.
While it includes many of the same elements of the TOMs mapping tool above, it also includes specific elements relevant to Welsh policy priorities.
Here you can find a comprehensive framework and guidance on how to adopt and embed Social Value principles and practices into any organisation, public, private, or Third Sector.
Scotland
The Scottish government’s approach is quite different to that of England or Wales. The government does not endorse monetary gauges to measure social value. The focus is on social impact and as part of this, sustainable procurement. The focus is on determining the social or national outcomes to be delivered through the procurement.
Here you can find details of relevant tools including a procurement prioritisation tool, a sustainability test, a life cycle impact mapping tool, and a flexible framework assessment tool.
Northern Ireland
The toolkit offers guidance on how to maximise the benefits of social value though supplier contracts by providing guidance and examples of social value outcomes, indicators, example questions and case studies.
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Keyah Consulting works with real estate and associated companies in developing their approach to environmental, social, and governance (ESG) issues. If you’re ready to explore what ESG might mean for your business, get in touch.
