Social value measurement in large scale infrastructure.

An interview with Daniel Fujiwara

Dr Mary-Kathryn Adams, Head of Strategy, Simetrica-Jacobs

To coincide with the publication of the white paper Before and Beyond the build: A blueprint for creating enduring social value at scale through infrastructure investments, I sat down with Dr Daniel Fujiwara, Chief Executive Officer at Simetrica-Jacobs, to get more insight into how and why social value measurement is so vital, and what it can lend to decision-making and investment on infrastructure projects.

Mary-Kathryn Adams: Can you summarise the Simetrica-Jacobs philosophy about social value measurement? What is most important, and why?

Daniel Fujiwara: There are three key things for us. Firstly, the ‘social value’ approach really is the philosophy itself: before measurement begins the departure step is always to ask what ‘value’ means in a moral sense for the project concerned. There is a very strong ethical foundation to this. 

The second consideration is how we measure social value and quality of life. At Simetrica-Jacobs, we’re committed to using the best practice that’s available, in terms of the scientific and statistical methods for measurement. A strong evidence base that is robustly underpinned by a combination of statistical and economic insight is absolutely vital. Otherwise, measurement is subjective, and decision-making will be based on weak evidence.

Finally, social value measurement must have a foundation in high levels of engagement with stakeholders – the people who will be impacted by the decisions of governments, businesses, or individuals. This is why we rely on large surveys that are well-structured, that reduce bias, and that involve all of the key stakeholders. This enables us to use data in the best and most comprehensive ways possible.

— 

MA: There are lots of potential methods for social value measurement – many of them flooding the market recently. How do we determine what is the best approach?

DF: It’s really important to understand that although social value measurement is getting a lot of attention now, it’s not a new issue – it’s not a new concept. People have been exploring social value from the very inception of economics as a discipline. The question of how governments or organisations spend their money has always been part of the discourse. Because of this long history in research and evidence – within economics and related disciplines such as psychology, ethics, and the social sciences – we now have a set of best practice methods. They’re not perfect; few methods are, within any discipline. But they are the best we can adopt.

This is reflected in OECD guidance, in the UK Treasury’s Green Book, and in similar manuals and guidance from governments globally. These pieces of guidance assert that we should be using full, comprehensive Cost Benefit Analysis routes, including an assessment of full societal impacts. We should be incorporating key areas of best practice around valuation methods, so that the value of change can be understood in a common currency across impacts and with costs. We should also be incorporating the measurement of cause and effect around impacts from the statistics and econometrics literature, to understand the unique contribution of investments we are considering as separate from that of wider trends. 

— 

MA: What are the most important factors to consider when measuring the social value of large infrastructure projects?

DF: Infrastructure projects are capable of delivering far more than we traditionally thought possible, and certainly more than we have measured or monitored in the past. The potential impact of infrastructure projects goes far beyond jobs and local spending. 

We know now that innovative, socially-focused projects can deliver better physical health, for example, through the provision of better quality green space and cycle lanes; we know that infrastructure can impact on crime, reduce inequalities, and improve our connection to place. These are often much larger and more impactful than purely economic benefits. 

The key is to have a really open mind when approaching an infrastructure project, and to carefully think through all the beneficiaries and potential impacts. Likewise, it’s important to consider the potential for unintended consequences, which might include negative environmental impacts, or severance between communities and a lack of permeability. This all needs to be measured robustly and in a scientific way. 

MA: How does measuring social value help policy- and decision-makers understand and redress inequalities?

DF: The wider impacts of interventions and policies, in addition to the question of who these impact, is a key element of measurement within social value. Our recent work allows us to quantify, for the first time, the value of redistribution and of reducing inequalities, in the same way we could account for employment or other outcomes.

This level of rigour gives decision-makers a new way to understand how their policies are impacting issues around equality and fairness. If this is done well and robustly, policy-makers can consider which options actually contribute the most towards a more equal and equitable society. We have started looking at this through a number of projects focused on road infrastructure, and there’s significant potential to deploy this same thinking on major projects like HS2 and Northern Powerhouse.

— 

MA: How can businesses begin to embed social value measurement into their culture and day-to-day practice?

DF: There are a few key requirements. Businesses really do need a dedicated individual or team to embed social value measurement in a meaningful way. And those individuals or teams need proper training and a thorough understanding of best practice as set out in the Green Book and similar manuals. 

The other requirement is around buy-in. Organisations need to commit to measuring social value at the most senior levels. To secure this commitment, it is vital to demystify social value measurement and to clearly communicate the meaningful impacts and implications of interventions directly to senior colleagues. It’s important to do this as much as possible, as early possible – whether this is at project level or alongside broader business operations.

Finally, it’s important for businesses to understand that social value isn’t an ‘optional’ activity or an ‘add on’ – everything we do has the potential to generate social value, but we can only understand this if we measure it. Putting social value in a ‘business as usual’ space gives you the capacity to not only generate and measure positive outcomes from your work, but also to build brand image and impact things like staff retention. And these are all things that have an impact on the bottom line. At Simetrica-Jacobs, we provide tools and training to help organisations measure social value and to relay results in real time.

For enquiries or for more information about Simetrica-Jacobs services, please visit our website or get in touch directly

Share this post

Share on facebook
Share on google
Share on twitter
Share on linkedin
Share on pinterest
Share on print
Share on email