Measuring social value

The National Social Value Standard (SVS) has launched a new social value measurement framework set to transform the construction industry.

Social Value commitments are increasingly prevalent in contracts, and the government giving huge weight to these benefits across public sector contracts, it is important for contractors to not only deliver benefits, but also to be able to measure them.

With social value forming a key feature of the Construction Playbook and the requirement for central government tenders to give a minimum 10% of their evaluation criteria to it, the new measurements will help set a gold standard for procurement.

Loop, which uses the framework across its software, has used its expertise in the field into developing the standard. Every outcome and every grouping has been carefully reviewed by Loop’s economists in line with the latest academic and government thinking.

Included in the update is the rationalisation of the social value pillars into three impacts – social, environmental, and economic – creating a clearer and more compatible framework structure.

Many of the metrics have also been renamed or consolidated in order to improve consistency and make them more user-friendly. They are now grouped under five headings to add more structure and improve navigation: Jobs, apprenticeships and placements; Workforce wellbeing, training and skills; Supply chain; Community, charity and other stakeholders; and Environmental.

The standard also allows tracking of negative values, supporting the framework’s push to mitigate overclaiming. Allowing users to use metrics that generate a negative value, such as the ‘made redundant/dismissed’ metric, and enter negative inputs for certain metrics, such as CO2e emissions, is a key step towards measuring a more accurate view of social value.

Ken Chalk, principal economist at Loop who worked on the National Social Value Standard, said: “This is the most significant update to the framework in recent times, with the large-scale changes made now allowing for future iterations to be about minor adjustments.

“We decided it was time for the development of this new version as social value methodologies and understanding continues to mature. Whether that is new methodologies being developed or a more sophisticated and tailored use of existing approaches, the aim is increasing the robustness and accuracy of the framework.

“The changes made are vital to ensure a more accurate, HM Treasury Green Book aligned, representation of social value, that can then help drive more efficient creation of positive impacts.

“We are confident that the update to the framework has ensured there is a more comprehensive and diverse range of metrics and valuations available, and we look forward to hearing feedback.”

The National Social Value Standard is leading the way in a continually changing social value world. New measurements, such as this, are continually being added into the standard to stay on top of changes. This was evident from the introduction of the WELLBY. It was included in the new HM Treasury Green Book wellbeing guidance, released in July 2021, and opened a new standardised approach to measuring social value.

Gerard Toplass, group CEO of Loop’s parent organisation The 55 Group, said: “Social value is an ever-changing space that continues to develop to reflect the social, environmental, and economic world that we live in. It is vital that this continues to be the case in order to increase the robustness and accuracy of forecasts and estimates.”

If you would like to read more stories like this, then please click here