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Connecting capital

Posted on 10 February 2017

I often get told that it must be dizzying doing the job of CEO in Groundwork due to the organisation’s diversity of interests, marketplaces and funding streams. 

To a degree that’s true. 

When the mission you set yourself is to make life better in local communities then you have to roll with the fact that people don’t live their lives in silos.  Problems are generally joined up problems – poor environments, ill health, worklessness, self-confidence, social isolation can be interwoven in complex patterns.  However, this means the solutions to these problems also need to be joined up, and if there’s one thing you get taught in Groundwork it’s always to look for the connections because it’s in those connections that we find creativity and where there’s creativity there’s a chance of change.

I was reminded of this axiom during the week.  First up was the 2017 Social Value Summit, a jamboree of big businesses, social enterprises and charities brought together to debate the future of doing good in a marketised system.  There was heady – but inspiring – talk of developing a new form of capitalism where businesses demonstrate their social purpose, where circular economies eliminate waste and where services are designed and delivered at neighbourhood scale.  There were also barriers identified – procurement processes that disadvantage social suppliers, public sector cuts that inhibit creative commissioning and the need for investment (in the right form and at the right commercial rate) to take good, social ideas to a bigger scale.  Groundwork got a good shout for helping Interserve develop a social value mapping tool, allowing the company to explain – and then plan – the impact its activities and people have in local areas.

However, the best thing about the event was its scale and diversity, considering the Social Value Act itself was introduced just a few years ago when my local MP Chris White won the equivalent of a parliamentary raffle to take forward a private members bill.  While most would contend that the Act is still immature and is yet to demonstrate major impact on the way things are done, the debate that it’s engendered is hugely valuable.  I was pleased to hear the minister responsible – Rob Wilson – commit to reviewing the Act with the aim of increasing its effectiveness as a tool in changing the way we think about the procurement and provision of good and services.  One of the most pertinent starting points for this was given by Mark Cook, one of the lawyers responsible for shepherding the Act into being, in that most people see social value as being linked with EU Procurement rules.  If these become irrelevant in a post-Brexit Britain then we have the opportunity to make a much more powerful statement of intent.

And here’s the connection.  A short walk along Embankment from the conference venue took me later in the day to the launch of the latest annual report of Defra’s Natural Capital Committee.  It would have been difficult to have found a more different set of people gathered in a room but the concerns and the approach were very similar.  For those unfamiliar with their work, the Committee has been employed by government to create the tools and develop the case needed to apply economic value judgements to the natural environment.  Primarily this is to ensure that nature gets properly weighed in the balance when the relative merits of investments and developments are being assessed.  It’s really important work, generating a raft of strong recommendations and being adopted by a range of organisations to help guide their decision-making.  It’s also central to the development of the government’s 25-year Environment Plan.

A number of the 16 recommendations launched by the Committee this week have the same theme – how to get the principles of natural capital accounting embedded in statutory and legal frameworks and, in particular, how to get business to behave accordingly.  It was pointed out by the Committee Chair Dieter Helm that Brexit has thrown an almighty spanner in the works in terms of producing a 25-year plan as so much of the legislation that governs the way we protect, manage and exploit natural resources emanates from Brussels and will therefore need to be rethought and reconstructed.

This does mean delay but it also brings opportunity.  Whatever the political and economic ramifications the next two years give us a window to reframe legislation so as to lock in the principles of both social value and natural capital to the way we spend public money and regulate private enterprise.  These two complementary ways of mapping our assets and opportunities also need to be brought together.  The concept of social value in communities will become meaningless unless it references the natural ecosystems which underpin a lot of what we cherish in our lives and in our communities.  At the same time increasing natural capital needs to be seen as important as employing apprentices or paying the living wage when tendering for a government contract.

Not everything that can be counted counts, and not everything that counts can be counted - so the quotation goes.  But we have a better handle than ever before on how to account for what we share. 

We also now have a moment in time to use the tools to transformative effect.  

Post by Graham Duxbury, Chief Executive

Groundwork UK