In the latest episode of PropCast, Kate Nottidge, director of social impact at Grosvenor, and Dr Eime Tobari, social value strategist and founder of COCREATIF, join Blackstock’s founder Andrew Teacher to discuss the challenges in defining and delivering social impact in real estate.
Unless you’ve been living under a rock, you will have heard of Environment, Social and Governance (ESG) criteria, which are the most popular ways a company measures its approach toward risk, resilience and positive impact.
The environment has so far received the lion’s share of attention in the ESG equation. The S for ‘social value’, however, has often been given short shrift as it tends to be less quantifiable. Yet, developments that offer something to the community tend to be more vibrant and successful in ways beyond conventional measures of property value.
For companies aiming to convince investors, shareholders and potential customers that they’re making a difference, easy and convenient metrics of success matter. There are limits to quantification, however.
For Eime Tobari, co-founder of COCREATIF, focusing only on measurable outcomes, and especially measuring all social impact in financial terms, risks the most effective social interventions being ignored. She adds: “In the standardisation of metrics, there is a danger companies focus too much on measuring and forget what the context is.”
“You can create this misconception that you understand social value,” Dr Tobari explains. “As a principle, social value is a movement that is against financialising worth.”
Grosvenor’s director of social impact Kate Nottidge agrees. “It can be a really narrow lens through which to consider impact,” she points out, risking on its own a skewed understanding of what social value is, and what activities to undertake.
Nottidge also highlights that convergence on a measure of social impact does not necessarily mean that there are agreed underlying methods: “A lot of companies out there are using different methodologies, coming up with quite radically different numbers.”
Frameworks such as those developed by ULI and UK GBC have provided useful ways to think about social value, but taking that to the next level by means of a kitemark or certification scheme entails challenges since, in Nottidge’s view, it “comes up against the fundamental challenge of just how locally dependent and contextual social value is.”
Nottidge explains that to better understand the context in which the property group operates, Grosvenor, in partnership with Simetrica Jacobs and The London School of Economics, has recently baselined and benchmarked wellbeing across the UK property group’s core locations.
“We are thinking about communities, residents, workers and visitors holistically,” she explains. “We can then gear up our asset management and development approach around the core need that the research identifies.”
Using the study’s findings Grosvenor will be able to compare wellbeing on its estate, much of which is in Mayfair and Belgravia, against ONS standards of wellbeing at a regional and national level.
“Crucially, we can then benchmark where we are today as well as our future contribution,” Nottidge elaborates. “Comprehensive community engagement allows organisations to hear first hand from thousands of individual stakeholders how they can improve their lives.”
Of course, communities never have uniform views.
“We’ve become better at reading the room, but you can’t please everyone,” Nottidge explains. “We also have to be conscious of what’s commercially viable”.
Tobari welcomes Grosvenor’s approach, especially the insight it gives into local context and the focus on less tangible aspects of worth, adding: “In the case of Grosvenor, self-assessment and benchmarking is very useful for decision making.”
In Spain, Tobari will soon be helping companies navigate the complexities of social value creation. She’s teamed up with asset management firm Estabona to launch Estabona Social Value, which will focus on the execution of real estate projects.
Since recording the podcast, Nottidge’s team at Grosvenor has made bold steps executing its own social value objectives. On South Molton Street in Mayfair, The Good Store, run by environmental charity Groundwork, has brought sustainable fashion to the area.
Tenant choice is another key aspect of Grosvenor’s social work. On the same road as the green department store is Fairshot Cafe which provides employment and training for young people with learning disabilities.
On a grander scale, Grosvenor’s plan to transform Grosvenor Square was recently approved by Westminster Council. The square will see 25 new trees planted while increasing the number of plant species five-fold creating a ‘woodland walk’.
Another reason for the increasing attention to social value and impact is that it is often what matters most to people’s everyday lives. It also has many touchpoints to the environment pillar of ESG. We still urgently need to decarbonise the built environment, but both Tobari and Nottidge see a great deal of overlap between the two categories. For example, urban greening provides space for people to congregate and relax, but also contributes toward urban cooling.
“We started with environmental sustainability, but we always wanted to evolve,” Nottidge says. “It’s worth remembering that the UN defines sustainability as being about people and the planet. We’ve focused a lot on the planet and rightly so, but the people part is so entwined”