What is social value?
Social value is a term used to describe the additional wider benefits that can be created by organisations and projects for individuals, communities and local businesses.
Infrastructure’s fundamental purpose is to meet society's needs, through assets and systems such as public transport, roads, energy supply, clean water and flood protection. At the same time, infrastructure projects can generate benefits beyond the basic functionality of the asset or programme. They can, for example, create jobs for the unemployed, nurture specialist supply chains, improve local air quality and urban environments, remove barriers to social inclusion, and increase the wellbeing of individuals and communities beyond the primary scope of the asset or programme. This is social value.
Because engineers deliver the services that are necessary for society to thrive, it is easy to assume that they are automatically delivering social value. This is not the case. Social value is what is added in addition to the primary purpose of the infrastructure.
For example, the £14.4m Ripon flood alleviation scheme in North Yorkshire was designed to protect 548 homes and 96 businesses from flooding. A subsequent study into the project, Investigating the Social Value of the Ripon Rivers Flood Alleviation Scheme, found a wide range of additional benefits, including:
- Perceptions of increased economic prosperity as a result of the greater level of protection, stabilisation of property values, and benefits to the local economy and tourism
- Less stress and anxiety (‘peace of mind’) for residents, afforded by the protection of the scheme
- Recreational and aesthetic improvements, including a footpath along the river
The Design Principles for National Infrastructure, published by the National Infrastructure Commission, emphasise that infrastructure projects should look for opportunities to add value beyond their main purpose. For example, the purpose of the Thames Tideway project is to clean up the River Thames, but the project is also delivering legacy objectives that were not essential for the asset but that achieved social value, such as volunteering and local employment opportunities.
The River Skell in Ripon, Yorkshire, one of three rivers that converge in the city, making it vulnerable to flooding
Legislation
The Public Services (Social Value) Act came into force in the UK on 31 January 2013. It requires those who commission public services, including infrastructure, to think about how they can secure wider social, economic and environmental benefits.
Before starting the procurement process, commissioners should think about whether the services they are buying, or the way they are buying them, could secure these benefits for their area or stakeholders.
In June 2018, the UK government announced it would go further, and all major central government procurements must now explicitly evaluate social value rather than merely “consider” it, using a Social Value Model that has been in use since January 2021.
The Thames Tideway scheme has delivered social value beyond its main purpose
What benefits to society can infrastructure projects bring?
At its simplest, social value can be defined as anything that improves people’s quality of life. These are shown in the graphic below.
These social benefits are in addition to the environmental benefits shown in the graphic below.
As noted in the RICS report Measuring Social Value in Infrastructure Projects: Insights from the Public Sector, without considering social value at the outset, infrastructure projects may not only fail to improve people’s lives but actually negatively affect these outcomes.
How can benefits be achieved at different project stages?
Social value is primarily considered during procurement and construction, in part because the Social Value Act requires it to be considered during these stages. However, it can be created at all stages of a project’s lifecycle, from the earliest planning, through design, procurement, delivery and into operations and eventually decommissioning.
The report Maximising Social Value from Infrastructure Projects, the result of a research initiative co-funded by the ICE Research and Development Enabling Fund and consultancy Useful Projects, has identified the steps that can be taken at every stage of the lifecycle to create social value through:
- Defining the purpose of the built asset and creating social value through design – ‘What you build’
- Developing the construction approach – ‘How you build’
- Creating opportunities in the operation of the built asset – ‘How you operate’
A brief description of how social value can be achieved at each stage is given below.
Strategic brief
The strategic brief is the document in which a client describes the requirements and the outcomes to be achieved by the project. It is an opportunity to ensure that the need to provide social value at every stage of the lifecycle is defined and clearly communicated to all stakeholders, based on a needs analysis. It also provides the basis for clients to signal to the market that creative and innovative solutions are needed to deliver social value.
Options selection and investment case
One of the most effective ways to deliver social value is simply to invest in the right projects. So it is essential to ensure that broad social value benefits are assessed during the options selection stage and in the business case in a meaningful way. Articulating the benefits and social value can also help to build support for strategic infrastructure projects.
Procurement of design and delivery teams
If done well, procurement can be a significant enabler for social value delivery. It ensures that social value opportunities identified in the planning and design phase are captured in contractual requirements so they are not lost and are enhanced/added to through subsequent phases. Research in the Maximising Social Value from Infrastructure Projects report found that there is a perception that "delivery of social value is outsourced by clients to the supply chain". If true, this places a great deal of importance on selecting the right delivery team.
Design development
Designing infrastructure so that it generates additional social value can transform the fabric of local communities, enhance local, regional and national economies, and provide a range of economic, social, cultural and economic benefits. There is an opportunity to provide social value during the design stage and to provide communities with opportunities to input into the design process to ensure that the asset meets their needs from a user perspective.
The Supply Chain Sustainability School has produced a guide, Social Value and the Built Environment, that looks closely at how designers can generate social value by:
- Integrating people’s views into design decision-making
- Supporting cultural integration and social cohesion
- Designing assets that promote the health and wellbeing of users
- Enhancing lifespan and value of assets
- Supporting economic prosperity
- Doing business responsibly
The design phase is crucial for influencing a project’s social value in various ways, including:
- The asset itself and the direct benefits it will bring
Consciously designing infrastructure so that it generates social value for individuals and communities supports economic prosperity, cultural integration, connectivity and social cohesion. It contributes to fairness in society. Designing places that people value, and want to spend time using, also enhances the long-term value of the asset. - The design process and its interaction with the community
Integrating people into the design process provides a sense of ownership and involvement, connecting people with places and making them feel valued. - The ability for additional social value to be added during subsequent stages in the asset’s lifecycle
Decisions made during the design phase affect the extent to which social value can be added later, for example through the potential for local employment, sustainable procurement and integration into communities.
Planning approvals
Including social value requirements in planning policy and the planning approval process could be a key driver in ensuring that new infrastructure projects and associated development provide additional social value that is based on local needs. If social value generation was one of the main considerations when deciding whether to approve a project, it would be a higher priority for clients.
Construction
A lot of social value activity occurs during the construction stage, although interventions tend to focus on providing employment and skills opportunities. While these initiatives do have high social value, broader opportunities based on local needs are often missed, and poor contract management can mean social value commitments are not delivered. Many people are involved in, and affected by, the construction phase of projects – from delivery staff to global supply chains to the local community. There are, therefore, many opportunities to create additional social value beyond standard construction delivery practices.
Operation
New infrastructure investment is only a tiny proportion of the total amount of infrastructure already operational across the country. Most of it has already been built and is providing ongoing services to customers. All asset owners and operators can create ongoing social value in the way they deliver services and can continually improve their approach. To have the biggest impact, infrastructure providers should consider themselves as long-term partners with the local community, working together to improve the area and people’s lives.
Decommissioning
The creation of social value during decommissioning tends to be overlooked. However, as we transition to a zero-carbon economy, there will be significant decommissioning of high-carbon infrastructure assets as well as the ongoing decommissioning of ageing assets – and there will be opportunities to generate social value during this process. These include activities that help to sustain local communities affected, such as improving education, training, employment, business support measures and economic diversification.
How can the sector benefit from creating social value?
The Maximising Social Value from Infrastructure Projects report says a proactive approach to social value in infrastructure design, delivery and operation can not only benefit individuals and local communities but also bring benefits to the infrastructure sector and the businesses and people working within it. These are shown in the graphic below.
Measuring social value
Being able to assess social value is important as it enables engineers and their clients to communicate positive impacts to stakeholders, make more informed decisions and identify where the greatest social value is being created in a project and in its supply chain.
In recent years, a variety of social value frameworks, tools and measurement processes have emerged to help organisations and projects to identify social value objectives and actions and to measure and report the qualitative impact and financial value of those actions.
The Social Value Portal, an organisation providing tools and support for people and organisations to implement social value, says: “The measurement framework is your [organisation's] foundation, so making the right choice is essential to set you up for success. It should define the themes most relevant to your community, the desired outcomes that will have the greatest impact and the measures that quantify that impact.”
The main tools currently being used in the infrastructure sector are listed in the appendix to Maximising Social Value from Infrastructure Projects. One of the most commonly used frameworks is TOMs (themes, outcomes and measures), which aligns to the UN’s 17 Sustainable Development Goals and focuses on five key themes:
- Jobs
Promoting local skills and employment - Growth
Supporting growth of responsible regional businesses - Social
Healthier, safer and more resilient communities - Environment
Decarbonising and safeguarding our world - Innovation
Promoting social innovation
Many organisations have developed their own in-house tools for capturing and monetising social value, often incorporating the TOMs themes.
There are different ways to predict, track, measure and report social value through the lifecycle of a project. The most common methods are shown in the graphic below.
How to get started
Social value is already being delivered through infrastructure projects and assets throughout the UK, but it comes in different forms. Understanding what is important to different communities, and in different circumstances, is an essential part of an effective social value strategy.
No two communities are the same, so understanding the community in which your organisation is working, or where the asset is situated, is the first step to building a successful strategy.
The next step is to focus on the goals and objectives that will benefit the community and then build consensus around the key social value outcomes that your organisation is most capable of delivering.
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