What is social value?

The Social Value Act 2012 came into force in January 2013 and effectively made it a statutory duty for public bodies to consider the potential social, economic and environmental wellbeing impacts on local communities and neighbourhoods, of the services they commission.

It is about changing behaviours in the commissioning and buying process to build in greater transparency, fairness and diversity to what is bought, by whom and for what purpose. We use it as an opportunity for levering better social, environmental and economic impacts and outcomes than would otherwise be achieved.

The Social Value Act was designed to enable new opportunities for social enterprises, community organisations and the third sector to partner with larger organisations and deliver more locally-led solutions. The government now expects new public services to be delivered in partnership with the community, social enterprises and third sector.

How and why does social value apply to the rail industry?

Social value has a wider application than public services and is manifesting in major public funded rail procurement processes as responsible procurement (RP). The Greater London Authority (GLA) has a Responsible Procurement Policy which is cascaded through the wider GLA family, including Transport for London, and this requires its supply chain to meet key RP objectives

The seven GLA RP Policy themes are geared towards delivering social value through the delivery of GLA projects and cover ethical sourcing, strategic labour and training needs, equality and diversity, fair employment, community benefits, workforce welfare, environmental sustainability and supply chain diversity.

Crossrail for example, has a strong emphasis on responsible procurement and places contractual demands on contractors to deliver on its responsible procurement targets.

For rail projects, as clients, it means looking at the smart use of their purchasing power to enable them to tackle issues such as: reducing worklessness in deprived communities; ensuring rail infrastructure and assets are inclusive; ensuring supply chains comply with equality and diversity legislation and that they have fair employment practices in place on projects.

As suppliers, it’s about how rail companies will form partnerships with external organisations to achieve objectives that are normally not their core operational and management remit. This could include engaging young people out of work and those vulnerable to worklessness, having full visibility of their supply chain to the source of products and commodities and providing assurance that they are managing risks inherent in those supply chains.

Can you tell us more about you and why you set up Mend London?

Back in 2010 we could see that UK government policy was shifting dramatically towards the need for people to become more involved in local decision making and for business to be more responsible towards communities and society as a whole. This was against a backdrop of global financial turmoil and the subsequent calls for austerity and public sector spending cut-backs.

Subsequent legislation reinforced this shift and there having been ever increasing demands on the private sector to demonstrate their corporate social responsibility (CSR), responsible procurement and ‘good’ business practice credentials in responding to public procurement.

We were excited by this shift in mentality but we could see that this demanded new ways of thinking and doing and new ways of working together. So we set up Mend to help the public sector manage procurement more responsibly, and help the private sector change the way it delivers.

Mend specialise in responsible procurement, planning and place-making. We provide advice and practical support to enable communities, businesses and organisations build social value and deliver better projects together.

This is a fast moving agenda but it is also very complex and sometimes quite emotive (especially around human rights, ethical sourcing and workforce welfare issues). So what all of our work involves is getting people to think differently about what they are trying to do, communicate better about why they are doing it and the best way to make that change. We build relationships across networks, sectors, places and communities to get things done.

Why should rail take it seriously?

Social Value is an agenda that is not going away. There is a growing sophistication on the part of clients and commissioners who understand the need to address it and the role it plays in demonstrating value for money to tax payers and stakeholders.

It is no longer just about on-time and on-budget – things have to be done responsibly too. This poses extra challenges and pressures on the rail industry to deliver on objectives that were hitherto ‘added-value’. Now they are core to value.

Despite it being a relatively new aspect of rail sector procurement, research I undertook with UCL into how CSR, responsible procurement and social sustainability were treated in mega urban transport projects including the Channel Tunnel Rail Link and the Jubilee line extension, showed that issues around social impact and wider social benefits were being grappled with back in the late 1990’s.

The research showed how the definition of CSR had changed as a greater appreciation of the complexity of understanding projects beyond satisfying political, economic and engineering requirements had also changed. It revealed how quickly projects are judged and affected by stakeholder perception and that CSR is increasingly becoming the means by which projects are valued, beyond being on time or budget.

Part of the issue was how to define and measure social impact arising from a rail – and wider construction and development – context: outcomes were often too woolly and felt prone to fuzzy definitions. What the Social Value Act and responsible procurement has done is to translate it into clear objectives and deliverables around engaging people in work and training, identifying standards and technical accreditations that need to be met, highlighting areas of risk that need to be managed and setting an agenda for the rail industry to explore how investment in rail infrastructure is also an investment in wellbeing, community and diversity.

Clients will cascade the impetus for delivering this to the rail industry. If the rail industry is going to respond, then it has to evolve and develop new ways of thinking and doing. This is no mean feat! And that is not to say that the practicalities of delivering the social value agenda, in any context, are easy – because they are not.

How do you find working with the rail industry and particular challenges and opportunities you have observed?

At Mend, we regularly come across clients and practitioners grappling with how to implement RP on complex infrastructure and construction projects.

We have been managing the delivery of the Dragados Sisk Joint Venture (DSJV) Responsible Procurement Plan, through the delivery of the Crossrail C305 Eastern Running Tunnels Project, for the last three years.

DSJV is the contractor responsible for delivering the Eastern Running Tunnels on behalf of Crossrail. The tunnels run from Limmo Peninsula to Farringdon/Victoria Dock and also Stepney Green to Pudding Mill Lane. This is the single biggest contract on the Crossrail Project.

DSJV’s RP Plan comprises targets and objectives relating to Crossrail’s six RP themes, which include; Fair employment, Supplier diversity, Community benefits, Skills & employment, Ethical sourcing, Environmental sustainability, and Workforce welfare.

Mend’s main areas of direct support are: producing DSJV’s quarterly RP and sustainability reports to Crossrail, advising on RP issues across the project disciplines, managing the DSJV Placement & Work Experience programme; monitoring site and project compliance with London Living Wage, Diversity Works for London and the Ethical Trading Initiative; and acting as vice-chair to the innovative Crossrail Ethical Supply Chains in the Construction working group, which is developing new methodologies for mapping ethical risks in complex infrastructure projects.

We work closely with the procurement team to engage, monitor and manage sub-contractors and our supply chain; work with the human resources and training manager to deliver on our apprenticeship, work experience and job starts targets and the environment team to monitor recycled content and carbon emissions.

DSJV has reached ‘World class’ performance in a number of RP reporting areas including supplier diversity, monitoring and reporting, fair employment, job creation and apprenticeships. The DSJV work experience Summer Academy enabled DSJV to win a Crossrail 2013 Sustainability award and I was runner up in the Crossrail 2012 Annual Awards Inspiration category for my work on ethical sourcing and youth engagement.

Key to the success of this has been collaboration and partnering. Everything about Crossrail is big. Applying RP and social value to a project of this size has never been done before so as a group of Crossrail contractors we came together to share information, experience (good and bad) and lessons learned on how to embed things like ethical sourcing into what in some case are very well-established systems, processes and supply chains. We established the Ethical Supply Chains in Construction Working Group.

And that is when it gets complicated. The rest of the industry and its suppliers need to respond and gear up. There is resistance sometimes but with patience and persistence we get there. However, without working as a group we would never have made the progress we have made.

So from this experience on ethical sourcing, we felt that there needed to be a space for us to come together as an industry (and beyond) to share issues and experience. This way, we can all benefit from accelerating towards knowing how to do things differently and better.

We have created Source RP with the aim of helping people in the infrastructure and built environment industry (and beyond) connect, share and learn with other people and organisations that are delivering in this very complex and fast moving agenda. It will also be a space for exploring new ideas, tools, processes for delivering RP. The objective of Source RP is to create an RP network and centre of excellence for the built environment sector, with a focus on social value.

The key challenges and opportunities we see ahead for embedding social value in the rail and wider infrastructure and built environment sectors are below and we are hoping that Source will help to address these:

• mainstreaming RP but not making RP mainstream: the former is RP being a vital functional and creative part of day-to-day operating culture and approach to business rather than the latter being RP as effectively in-sourcing ‘good business’ as a bolt-on, without actually changing own ways of thinking and doing
• not being about ticking-boxes or rubber-stamp approvals: helping businesses, projects and organisations move towards improving performance – and competitive advantage – by understanding and managing their social impacts
• fostering connections between organisations that would not have met otherwise: enabling an eclectic mix of people and ideas to come together is often the best way to foster innovation because it widens exposure of different people and groups to collaborate
• building relationships across networks and sectors to get things done: expose businesses and organisations to a wider mix of other organisations and partners to enable them to play with people that don’t normally play with them.

About Liane Hartley and Mend

Liane Hartley (@lianemendsacity) co-founded Mend, a social enterprise specialising in the social impact of change, and making the way projects are commissioned, planned and delivered more socially intelligent, responsible and user-oriented. Hartley has more than 12 years of experience as a planning, strategic policy, and responsible procurement consultant.
She is a regular speaker at conferences and has contributed articles and expert opinion on social sustainability to a diverse range of publications including theguardian, The Financial Times, Planning magazine, URBAN DESIGN Journal, Building magazine, The Architects’ Journal and Construction News.
Hartley founded and runs the Urbanistas network which is a collaborative network and think/do-tank for women with an interest in social innovation in the context of cities and urban development. She is also a Design Council Built Environment expert. Hartley and Mend were the only social enterprise to be recognised in Building magazine’s Top 50 Rising Stars in Sustainability 2012.
Mend sees the ‘community as client’ and aims to elevate the role of communities in decision-making about their local area and neighbourhood, building relationships across networks, sectors, places and communities to get things done. Its clients range from small community groups to mega-urban transport projects and like-minded developers.
www.mendlondon.org.uk