Social value in 2024

As 2024 kicks off, we thought we would take a look at some of the key areas to pay attention to if you are keen to maximise your social value delivery this year.

As budgets for many organisations become tighter and demands for ‘value add’ from public sector become more prevalent, we think that anyone with social value on their agenda needs to pay attention to these key areas.

Sustainability legislation

New legislation landing in 2024 means that sustainability will be at the heart of conversations across boardrooms of all sizes and is driving behavioural change from the top down.

The Corporate Sustainability Reporting Directive (CSRD) is an EU directive that came into force in 2023 and while the UK sits outside of the EU, many UK businesses who operate in the EU are still directly affected by this legislation. It requires companies to report on the impact of corporate activities on the environment and society, and requires the audit (assurance) of reported information.

In addition to this, new sustainability corporate disclosure standards are likely to be endorsed by the government by this summer.

Similar to those issued by the ISSB, businesses will be expected to disclose material information about all sustainability-related and climate-related risks and opportunities.

This will impose a new economic paradigm. In other words, sustainability will become factored even more into the cost of doing business, creating new systems and behaviours.

This will put pressure on company owners and CEOs to acquire and/or hire the more dynamic skills needed to create sustainable businesses.

Familiarise yourself with the upcoming legislation. You may need to undertake a risk assessment; do you have the reporting mechanisms in place to support this? Be sure to look at your current skill sets and assess if you are well placed to meet this shift.

Social impact disclosures

In the same way that ESG disclosures have now become standard, we are likely to see the concept of a ‘social impact disclosure’ become incorporated into risk management and corporate strategies, making the ‘Social’ a lot more prominent in ESG strategy decisions.

As businesses will continue to be held to higher governance standards, they will be compelled to leverage social value to respond to the consumers need for greater accountability and responsibility. These disclosures will aim to mitigate or reduce any negative impacts created by a business by demonstrating positive impact on both the environment and society at large.

These disclosures also drive an increased need for authenticity as actions and impact become more transparent. Businesses will need to engage with their employees, suppliers and wider stakeholders to co-create and co-deliver quantified social value outcomes and communicate their results widely and effectively.

Consider your social impact statements. How visible are they? How often do you review them or report back on their success? Are they separate from your ESG reporting and can you tie this in with your social value reporting?

Social value across wider sectors and supply chain

The legislator’s downward pressure on public procurement means that the procurement system will unlock additional social benefits by its very existence.

However it is not just a central government edict. There is a general consensus towards increased corporate social responsibility as commercial best practice. This will encourage all procurement professionals to require greater social impact accountability from their suppliers and their suppliers’ supply chain.

Look at any of your substantial contracts and start those conversations now – are they going to require increased social value delivery from you upon renewal? Even if you don’t supply central government directly, it is likely that you will still need to deliver significant social value and adhere to the Social Value Model.

Social value software as standard

Standardisation and digitalisation of data will accelerate organisations’ social value endeavours. 

As specialist social value platforms become standard across organisations that need to deliver truly transparent and accountable impact, we will see software evolving further with new features, formats, or functionalities. Social value software needs to support you not only in the delivery and output phase, but also in the planning phase of your projects; looking at needs analysis when it comes to mapping out where to deliver initiatives, right through to the anticipated impact.

Discuss with your social value software provider about upcoming plans for the year and what new features you can expect to help you execute your social value requirements more efficiently. Ask how they incorporate global reporting standards or how they can accommodate your own industry reporting requirements.

The upsides and downsides of AI in social value

AI is certainly a buzzword across many industries right now, as they grapple to understand how it can help but may also hinder.

As with many sectors, AI will be useful when applied to large datasets of social value information, helping users to see patterns or finding insights that were previously hidden due to the shear volumes of data available. For instance, using AI to summarise the sentiment of data collected from thousands of your benefitaries, enabling easier and more strategic decision making about the effectiveness of your programs.

At the same time there is an obvious downside of AI. Social value is all about people and so any technological change that negatively impacts jobs or through its use causes us to become disconnected from the underlying difference we are making in peoples lives must be treated with caution.

AI may have been suggested to you as a way to create a sustainable competitive advantage. However, ensure the quality, ethics, and authenticity of any AI-enabled endeavours to avoid potential risks and pitfalls. 

Social value is a continually evolving sector, the importance of which is growing on the agenda of board meetings and stakeholder evaluations. Of course there are more facets of social value that will evolve in 2024 but for now these are our 5 pointers to look out for and consider. It will be interested to recap them at the end of the year and see which one was the most prominent!