What is ‘Social Value?’

Social value, often cited in procurement and contracts, simply refers to any additional benefit of a goods or service.

In recruitment, this could materialize as training to elevate skills in a community, or providing workshops to support those preparing for interviews. Equally, by resourcing locally, social value would be added to any employment by both diminishing carbon impact and reducing localized unemployment.

Employers can extend social value by ensuring that they are offering equal opportunities, reducing the disability employment gap and challenging workforce inequality. Increasingly, this accountability is being written into companies’ corporate strategies, as in the case of climate change with sustainability metrics. Such issues are being managed through positive reinforcement, with bonus’ being offered to encourage forwards progression.

So, how can social value be realised within supply chains, and what is the understanding of supply chain social value from an end-client view?

Since 2020, the launch of the Social Value Model has meant greater scope to deliver strengthened benefits through procurement – with the capacity to affect £49 billion public funds per annum.i

The ‘National TOMs’ – standing for Themes, Outcomes and Measures – is a framework created to provide “excellence in measuring and reporting social value.”ii The framework started as a solution for the Social Value Act, and evolved into a measurement standard across the UK, broken down as follows:

– Themes – visionary social value areas.

– Outcomes – positive changes within the community.

– Measures – quantifiable actions to deliver outcomes.

The measures are designed with five key areas in mind:

– Jobs

– Growth

– Social

– Environmental

– Innovation

The National TOMs are constantly evolving. The updated version for 2022 includes revamped climate measures, a new learning resource and day to day social value creation.

Alex Gosney, CEO of Nutral, shares his views on social value below:

“At Nutral, we are fully committed to providing our clients with a value-oriented experience. The literature is clear, a diverse supply chain enables a more productive and innovative workplace so why would you restrict yourself to working with the same suppliers across the country? Through our community, we work with local and specialist supply chains to help reduce your carbon footprint whilst attracting a diverse workforce.”iii

For clients like Balfour Beatty, measuring and reporting social value is becoming increasingly imperative, hence their use of the Social Value National TOMS Framework to meet the criteria set in the recent Procurement Policy Note (PPN 06/20). Using this recognised means to measure social impact, Balfour Beatty proves a true commitment to social value beyond lip service. According to Balfour Beatty, social value is achieved by “thinking globally, but acting locally,” a sentiment reflected in their ambitious 2030 target to generate £3 billion social value. iv

Likewise, Morgan Sindall exemplifies the success of end-client social value, with their philosophy “to leave a positive legacy” through all projects delivered.v The company’s Social Value Report, published 17th August 2022, celebrates an impressive total of £3.5m social value, accumulated across all contracts for the period of April 2021 – March 2022.vi The report testifies that the business is a best practice social value business, which goes beyond the provision of physical housing services to enhance the lives of residents by investing in communities. One such example is the ongoing partnership which Morgan Sindall has with Construction Youth and Fulham Boys School for the Building Brighter Futures Programme.vii

Below are a few other notable accomplishments that Morgan Sindall Property Services boasts:

– 20 kickstart placements with 15 permanent positions offered in the business.

– 1,191 people received employability support, with over 1,000 of these aged under 24 years.

– £22,071 issued in energy vouchers supporting 191 households.

– 45 apprentices enrolled in the business

– 201 hours spend volunteering in the local community.viii

Similarly leading with integrity, AECOM (worldwide infrastructure consulting firm) have now hosted two ‘Talking Without Limits’ events. There, industry experts such as Programme Assurance manager at London Luton Airport Michelle Griffin have voiced the crucial advancements facilitated through public sector social value. For example, Griffin explains how the Social Value Act reinforces a commitment to improving Luton, promoting the airport to issue “major contracts with 20 per cent scoring for social value,” hence advancing opportunities for local people to build careers and escape the poverty trap. Luton Borough Council is the sole shareholder of London Luton Airport Ltd, fostering the council’s aim to eradicate poverty in Luton by 2040.

Social Value Portal (AECOM’s strategic affiliate on social value) recognise the importance of viewing social value through the lens of a lifecycle, “think about the long game” urges Nathan Goode, Chief Strategy Officer. Goode goes on to explain how, through creating a standardised measurement framework, Social Value Portal is driving change by embedding their work in companies and communities nationwide, as evidenced in Balfour Beatty’s example. ix

Pagabo – whose core business helps organisations to maximise social value from the procurement process, while supporting suppliers to deliver greater social value through their contracts – has a total social and economic impact exceeding £5 billion. The company claims that through their “unique partnership with social experts, Loop” they can conclusively calculate anybody’s social, environmental, and economic impact, including the financial value of this impact.

One successful case study is Tilbury Douglas’ £6m Leeds Beckett University Law School Project, procured through Pagabo’s ‘Medium Works Framework’. The scheme will improve accessibility – with two new lifts to be installed, adding social value through removing ableist barriers to Further Education. Moreover, the project will elevate the skillset of a generation and secure Leeds as the legal capital of the UK. The school “will play a huge role in all of business in the future” and is crucial to the city retaining its talent into the future.

Deloitte, made up of 22,000 members, joined Social Value UK as an organisational member, with resolve to have a real social impact. Testament to this commitment is Deloitte’s 5 Million Futures programme, which aims to support 5 million people by 2030.x To date, Deloitte’s Million Futures programme has positively influenced 900,000 UK futures. Over three years, 80,000 volunteering hours have been clocked up by the company, with an additional 30,000 hours of pro-bono work, proving how collaboration with, and commitment to, social value can massively transform lives.xi