What is social value in construction?

Simply put, the concept of ‘social value’ in construction refers to the potential benefits a project can offer both the local and wider community. These benefits can be long and short-term, ranging from employment or housing to public amenities and sustainability. While there isn’t a single clear metric to track the social value of a project, these brief examples are an initial insight into what this could entail:

• Creating jobs and long-term employment
• Ethical and low-carbon supply chain sourcing
• Engaging charities, community organisations, and NPOs
• Promoting a sense of identity and cohesion within communities

What you want to consider is how the project will not only fulfil clients’ requirements but also engage with the wider community to address its needs.

Why is social value in construction important?

Over the last decade, the construction industry has been increasingly scrutinised in a bid to improve its social and environmental impact. This is evident in new sustainability regulations, pushes for construction projects to support SMEs and the need for a proactive approach to building safety. All of these examples indicate a growing emphasis on social responsibility, backed not only by governmental and regulatory bodies but the general public. McKinsey has reported that society’s expectations for businesses are increasing, which has been one of the biggest influences for the shift towards social value in construction projects.

From January 2021, construction contracts must include a social value plan in their bidding process that outlines how social value will be delivered during the contract. This is still a relatively new concept in construction, but it’s one that contractors need to come to terms with to remain both compliant and competitive.

Of course, aside from achieving regulatory compliance and driving successful bidding, social value is important in construction projects simply because of the resultant impact on communities. Ultimately value should be a two-way street, with construction companies benefitting economically while offering something positive in return.

What does social value in the construction process look like?

Social value needs to be incorporated into both the design process and construction phase so that it delivers during and after the project is completed. It should also be tailored to clients’ visions so they can realise the social aims they want to achieve. For example, tech companies can be energy-intensive, so they may not only want their buildings to create work opportunities, they also want to minimise carbon emissions. This could mean incorporating bicycle paths, solar farms, and water waste reduction systems into the building’s design so they can offset their energy usage. Here are some key considerations when developing the social value aspect of your project proposal.

• Focus on priorities: There are a multitude of ways a construction project can benefit society, but it’s important to focus your efforts on where you will make the most impact. Work with each client to set their priorities, whether it’s creating new employment opportunities or providing amenities to the local community.
• Build it into every aspect of your bid: It’s not enough to say that you will focus on social value or add some key social value points to your bid. Instead, social value needs to be embedded as deeply as possible into the entire project process. Include clear guidance for all parties and consider using contractual obligations to ensure all value propositions become a measurable reality.
• Include accountability: Make sure your teams understand your goals and what their role will be in achieving them. You may want to consider sub-alliance contracts in complex projects so that all parties are united under shared goals while also sharing risks and responsibilities during the project delivery process.
• Highlight achievements: This is a learning process for the construction industry and your clients, so it’s important to work out exactly what was effective, why it worked, and what it achieved. This not only helps to attract clients who want to incorporate social value into their projects, but it could also inspire future projects by showcasing real examples of success.

How is social value in construction measured?

There is no widely-accepted or standardised model for measuring social value – much like the issues around measuring corporate social responsibility. After all, social value is subjective and nuanced. This means it is difficult to quantify whether some goals are objectively more important than others – never mind how to measure these goals over the lifespan of a construction project.

Currently, the best option available is Social Return on Investment (SROI). This involves establishing the scope of the project, identifying key stakeholders and mapping outcomes through community engagement and consulting with relevant organisations.

Then it’s time for gathering evidence on outcomes, which can be achieved in various ways but primarily through detailed surveys. Each outcome will have its projected social value, which can be determined by using the following criteria:

• Deadweight: Is there any change that would have likely happened regardless of the project going ahead? For example, if people wouldn’t have gotten jobs through the construction project would they have easily found work elsewhere?
• Displacement: To what extent could the project potentially move issues from one area to another? These issues may range from unemployment to homelessness, or even crime rates.
• Attribution: Is the project’s value derived from working with a certain individual or organisation? If so, what is the likelihood of value decreasing once this person or group is no longer involved?

Calculating the SROI, or social return on investment is quite complex, but online tools such as a Local Government Association Evaluation tool can be very helpful for turning data into digestible statistics and outcomes. You can also use this tool to generate reports on the social value of the project, which is important both for evaluating its success in terms of your chosen goals and for informing future projects.

What are some examples of social value in construction?

Practical examples of social value in construction can be a good source of inspiration, especially if this is unfamiliar territory for architects or construction companies. Here are some examples to help build your social value model:

• University of Exeter: This project worked to support local businesses by sourcing over half the project’s products and services, and more than a third of the required labour workforce, from within a 20-mile radius of the Penryn Campus. The building design also incorporated a range of features to reduce carbon emissions, culminating in the university receiving a BREEAM rating of Outstanding in the project’s design phase.
• Aurora Development in Bristol: This development was about pushing rental growth and bringing in new business to support long-term employment opportunities, ultimately bringing economic power back into central Bristol. It not only focuses on employment, but occupant wellbeing through thermal comfort, natural lighting, glare control, and basement car and bicycle parking.
• Denton Holme Student Residences in Carlisle: This project regenerated a former brownfield site into much-needed residential accommodation for the student population. Not only does it have a low carbon footprint, but it also offers all the amenities students need, from seminar rooms to individual study rooms, break-out area facilities and computer suites.

CLM Fireproofing is one of the leading passive fire protection companies in the UK. We have an extensive record of working on high-rise buildings, public works projects and commercial and residential developments. To learn more about what we can contribute to your next project, contact our team of experts today.