In the rapidly evolving and dynamic landscape of sustainability, the concept of social value is gaining increasing traction for organisations across all sectors. While financial profit remains a focus for many businesses, creating social value is becoming an important consideration among clients, the general public and policy makers. With this increasing interest in businesses' impact on community, the economy, the environment and wellbeing, we explore what social value actually is, and why it can provide benefit for all organisations.
What is social value?
The Public Services (Social Value) Act 2012 came into force in January 2013, requiring those who commission public services to think about how they can deliver wider social, economic and environmental benefit. But what exactly is social value?
You may have heard of corporate social responsibility (CSR), or perhaps the social ‘S’ aspect of environmental, social and governance (ESG) – social value encompasses both frameworks but ensures that the needs of the local community play a central role.
Social value is not merely a token gesture or a checkbox to tick off; it goes beyond surface-level actions and aims to create tangible, positive impacts that drive meaningful change. Whether it's investing in sustainable practices, supporting local communities, or fostering inclusivity and diversity, social value initiatives are about making a real difference. Here are some key examples:
- Partnering with educational institutions to provide internships, apprenticeships or work placements.
- Implementing a volunteering policy across the workforce focussed on supporting local environmental initiatives.
- Improving the supply chain selection process to reduce any barriers to entry for new businesses, entrepreneurs and start-ups.
Who does social value apply to?
Social value is relevant across all organisation sizes and types, from multinational corporations to small businesses and non-profit organisations and is relevant to all stakeholders across the supply chain and wider community. There is no one-size-fits-all approach to social value; understanding what is important to each organisation and the surrounding community is integral to building an effective social value strategy. It requires a tailored approach that considers the unique strengths, challenges, resources and values of each organisation, as well as the needs and aspirations of the communities they serve.
Why is social value important?
Embedding social value into organisational practices offers a significant number of benefits that extend far beyond philanthropy or corporate social responsibility initiatives. Here are some key advantages:
1. Brand trust – organisations that authentically implement social value practices will develop a positive brand image, for future employees, clients, and their wider communities. For example, 76% of customers are more likely to trust a company that leads with purpose (Porter Novelli).
2. Innovation – embedding social value encourages organisations to think creatively and find innovative solutions to social and environmental challenges. For instance, Sustainability leading companies are more than 4 times more likely to be recognised as innovation leaders (Deloitte, 2013).
3. Investor Attention – investors are increasingly prioritising ESG factors into their investment decisions, therefore implementing these initiatives attracts more socially responsible investors. For example, 79% of investors say ESG is an important factor in investment decision making (PwC, 2021).
4. Employee Attraction and Retention – employees are increasingly seeking purpose in their work, therefore prioritising social value positions organisations to attract and retain employees, foster employee engagement and build a culture based on shared values. Purpose-driven companies have 40% higher levels of workforce retention compared to competitors (Deloitte).
5. Resilience - embedding social value into business practice enhances lives and prospects, fostering more robust and resilient workforces, thus increasing business resilience. Some studies suggest that organisations with higher sustainability scores are more resilient (Albuquerque et al., 2020; Ding et al., 2021).
Conclusion
Regardless of where you are on your business journey, embracing social value can unlock opportunities for growth, resilience, and positive impact. Whether you're a start-up, a small business, charity or large business, integrating social value brings positive benefit internally within an organisation but also externally within the wider community.
At Pointer Consultancy Group, we specialise in helping organisations embed social value into their operations and create positive impact. Whether you're looking to develop a social value strategy, implement impactful initiatives, or responding to social value requirements as part of a tender proposal, our team is here to support you.
Contact us to learn more about how we can help you create meaningful change through adopting social value.
See our LinkedIn posts if you are interested in learning more about how Social Value can be applied to the SME bid context here.
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