COMMENT: At an industry roundtable event prior to social distancing, I found myself sitting next to a developer who proudly told me that his company had “delivered £18m of social value last year”. He then shrugged with a puzzled expression. I’m pretty sure the shrug was because he didn’t have much of an idea of how this money translated into the impact his business has had on real people’s lives. And I worry that was the reason he’d chosen this metric; it sounded impressive, and – dare I suggest – it saved him the trouble of really understanding the human impact of his developments.
Getting to grips with the concept of how the property industry measures social impact can be a fascinating but difficult process. Barely a month goes by without a panel, speech or roundtable ending with a similar conclusion: “We need more data!” More metrics. More benchmarking.
But what I’m sure of is that this process can’t just be distilled down to money – however much cash might be a metric that resonates with most of the property community.
Dive deeper
In property, if we don’t get beyond the monetary estimation of social impact, we’ll never fully understand what we’re doing in the realm of social impact or how we can do it better. Evaluation has to be people-centred, with a mixture of qualitative and quantitative approaches, and not just reduced down to a financial sum.
It is understandable that there is a pull towards crystallising social impact into a single number, especially if that is being reported in annual sets of results or trading updates. But we need to dive deeper into the consequences of development. How do we really want our success to be defined?
The commercial and social success of a development can be defined by how precisely we identify and then meet the local social need for real estate and infrastructure – at a minimum cost to the environment and society.
So we need the resource to work with local communities, to identify the social need for investment. We also need to measure that impact, to make sure we’re achieving what we set out to achieve. People and communities must remain central, and that means giving them a voice in the process – before, during and after a project. That way, we can learn valuable lessons for the future.
Do the right thing
We do this because it’s the right thing to do. We do this because it’s what people want us to do with their pensions and savings. But also, if the property business wants to attract a generation of more socially aware talent, we need to show that we’ve engaged with social impact to a greater extent than just writing a cheque for charity or putting a big number on the side of a CSR report.
If our investments are truly driven by a communal sense of humanity, which is at the heart of ESG, let us never lose that humanity in a blizzard of “social” financial metrics.
The next time someone quotes you a financial amount as a measure of social impact, ask them what that delivered. The answers will stand us all in good stead for the future.
Pete Gladwell is head of public sector partnerships at Legal & General Investment Management
