Is Social Value all about the price tag?
Social value is the extra benefit a project, business, or decision creates for people and communities.
Social Value is not just about profit or additional costs. Social Value is about how something makes life better for the people who live, work, and use it. Traditionally, success has been measured in money: revenue, savings, ROI etc. Social value is different. Social Value focusses on jobs, growth, the environment, and community. For example:
- Jobs and skills: local apprenticeships, training for young people, employment for groups that are often overlooked.
- Environment: lower carbon, reduced waste, biodiversity gains that improve quality of life.
- Health and wellbeing: safer spaces, better air quality, access to green areas, less isolation.
- Community strength: local suppliers getting contracts, charities supported, volunteering time.
So, in practice where does Social Value fit in?
There are 3 key areas where Social Value operates
1. Public procurement: In the UK, the Social Value Act requires public bodies to consider social value when awarding contracts. A council contract, for example, a waste management contract, the council should consider and weigh the contract not just on who is the cheapest but which contractor will hire local workers, train them, run workshops for students and support a local initiative.
2. Business: Companies report on social value to show impact to customers, investors, staff and the wider community. For example, a supermarket funding a food bank, or a IT firm running free digital skills classes.
3. Development and infrastructure: A housing development can be measured by the number of homes built or a community centre delivered and the number of local jobs it created, apprenticeships employed during construction, funding a local charity and supporting long-term wellbeing of residents.
How is Social Value delivered?
There isn’t one single formula to delivering Social Value, but common approaches include:
- Social Value Model: used in UK government contracts, with themes like Covid-19 recovery, climate, and equal opportunity.
- TOMs Framework: assigns monetary proxies to activities, e.g. £ value of one volunteer hour or one person moved into employment.
- Stories and Data: combine numbers with real stories. “£2m in local spend” means more when you also hear about the small business that hired two new people because of it.
The key to measuring Social Value is to be specific on numbers / KPIs and data to qualify how the Social Value has made an impact, and how the measurement ties activities to outcomes not just “we ran a workshop” but “30 people gained a qualification and 12 moved into work.”
Why has Social Value rapidly moved up the business agenda?
There are three key drivers that are pushing social value up the agenda:
- Risk: Ignoring community impact leads to delays, protests, and reputational damage.
- Expectations: People want organizations to do more than maximize profit.
- Long-term value: Healthier, more skilled, more connected communities are better customers, employees, and partners.
What are the challenges facing Social Value?
Social Value can become a time consuming box-ticking exercise if it’s not designed properly with key metrics from the outset. Another challenge with Social Value is there is not a one size fits because all sectors vary all and it is hard to compare across sectors because context matters. For example, what counts as high value in the city of London might be different in rural town in Cumbria.
The key is to involve the community early, set clear outcomes, and track and report them honestly, even when the results are mixed.
The Beauty of Social Value
Social Value reframes the question from “how much did it cost?” to “what did it do for people?” When done well, it aligns to organisational financial goals with human outcomes. Social Value will deliver you projects that are not only viable, but also wanted and useful.
