The three components of ESG – Environmental, Social & Governance - are often seen as separate pillars to achieving a better, healthier and sustainable world. However, in order to achieve the most comprehensive and truly sustainable outcome, it is vital that the three parts work together.

Aligning the three pillars

Creating a joint strategy with the same aims and objectives is the key driver to delivering high quality ESG outcomes, and ownership is fundamental to this. Who will be responsible for the creation of the strategy and who will deliver it? When looking at including open green space in a development for example, identifying who it’s for, when it can be used and who will manage and maintain it, is when an ESG focus can be pivotal in creating sustainable places. Understanding and sharing the successes achieved through such an approach will also result in the wider benefits of sharing best practice and replication.

The other area to consider when thinking about bringing the E, S and the G together is how the culture of a business and its principles are influenced by a collaborative approach.

When understanding what support a business needs surrounding the ‘S’, one of the first questions should be 'what are you doing about the E?' The answer will drive considerations about what they truly value and how from a social perspective these values can by integrated with the E. It also provides the scope to seek improvements of the impact the E is having on their business too.

Engagement and outcomes

The value creation comes from ESG investment in delivering outcomes for the people and stakeholders affected by the decisions driven by ESG. If a building is designed in the most sustainable method possible, then the people living, working, using or surrounding that physical asset will be the recipient in some form of the value-add. If the ESG policy is robust – and, more importantly, viable – then its creditability will be paramount; there’s no point in setting unachievable ESG goals.

By drawing together an ESG policy that considers all stakeholders throughout the development and asset life cycle, the acceptance of the policy within the business will ensure the continuation of value being added.

Measuring social value

It’s always important to remember that social value measurement is still maturing and isn’t perfect, but it is in a very good place in terms of credibility and integrity of the proxies and metrics that underpin quantitative social value reporting. The measurements that have been used for collecting data for ‘E’ outputs have been more widely used for a longer period of time and are more mature, in some aspects.

Measurement frameworks provide consistency, but the lived experiences of those involved is not adequately captured yet. It’s therefore important to create research that can qualitatively demonstrate the outcomes of a social value project, and where possible add the quantitative value of the outcomes that can be measured, taking into account negative outcomes.

For example, by engaging with local community stakeholders in the design of outdoor space and raising awareness of concepts and standards around as biodiversity and net zero, we can help the community make much better use of the space.

By bringing together experts to work closely and collaboratively, this will in turn drive a better and greater sense of the E the S and the G working together to create a more powerful impact on society.

Further information

Contact Wesley Ankrah

Real Estates Insight Podcast: Savills Earth Series – Episode 5, Social value