1. Social value reporting: An integrated approach John Maddocks – CIPFA john.maddocks@cipfa.org

2. cipfa.org.uk Why Social Value?  Public Services (Social Value) Act 2012 Pre-procurement - Consider how what is being procured might improve the economic, social and environmental wellbeing of an area  Improved effectiveness and efficiency through a more rounded understanding of an organisation’s (or programme’s) activities and their impact on people and communities.  Improved decision making?

3. cipfa.org.uk A working definition for reporting social value … Performance in terms of contribution to economic, social and environmental wellbeing

4. cipfa.org.uk Range of value creation … User/ customer Service/ programme Organisation Policy Community Value for a population Value for individual, programme, service or organisation

5. cipfa.org.uk Measuring social value … many models and methodologies  New Economy Cost Benefit Analysis model  HACT Social Value Bank and Value Calculator  Adult Social Care Outcomes Toolkit (ASCOT)  Big Society Capital Outcomes Matrix  Value added statement  Sustainability reporting (eg GRI G4)  Social accounting  Social return on investment  Integrated reporting  GECES approaches to social impact measurement

6. cipfa.org.uk Challenges of measuring and reporting  Variations in quality of measurement & reporting  Differing definitions  Variations in content and format  Assessing the contribution of a service to particular outcomes  Achieving balance (positives & negatives)  Deciding on what is and isn’t relevant  Comparability  Cost  Providing concise, clear, decision useful information

7. cipfa.org.uk GECES – impact & outcome reporting characteristics …  Explanation of the process applied  Clear account of the effects of the intervention  Explanation as to how that happened  Identification of any third parties having a role in the effective delivery of those outcomes and impacts  Appropriate and proportionate evidential underpinning  Identification of stakeholders whose interests are measured  Well-explained, proportionate, indicators  Explanation of social and financial risk (where helpful)

8. cipfa.org.uk Integrated Reporting - The goal  The goal is a more coherent and integrated explanation of an organisation’s ability to create and sustain value  Potential benefits include improved effectiveness and efficiency through a more rounded understanding of an organisation’s activities and its impact

9. cipfa.org.uk Draws on developments in …  Global convergence of accounting standards  Sustainability reporting guidance including sector specific guidance  Non-financial reporting including social accounting  Discourse on the evolving nature of financial reporting  Existing work done on integrated reporting eg South Africa  Work on governance eg King III

10. cipfa.org.uk Sustainability reporting Influences on reporting approach? GRI A4S Payment by results Outcomes Impact reporting IIRC Governance Narrative reporting Financial reporting

11. cipfa.org.uk ‘Capitals’  Creation of ‘value’ through the use of ‘capitals’:  financial  manufactured  intellectual  human  social and relationship  natural  Relationships between capitals, business model, external factors and strategic thinking  How these capitals, the business and society are impacted through the process of value creation.

12. cipfa.org.uk Integrated reporting

13. cipfa.org.uk Challenging current practice  Integrated thinking - thinking outside of silos and recognising the complexity of value creation process  Stewardship - accountability for financial capital, but also of the other ‘capitals’  Focus - connects past performance with strategic objectives and ability to create and sustain value  Timeframe - short, medium and long term, avoiding excessively short term perspective.  Trust - emphasises transparency  Adaptive - identifying what is material  Concise – only the most material information  Technology enabled – use new technologies to link information in the report to further detail elsewhere

14. cipfa.org.uk IR guiding principles … A.Strategic focus and future orientation B.Connectivity of information C.Stakeholder relationships D.Materiality E.Conciseness F.Reliability and completeness G.Consistency and comparability

15. cipfa.org.uk Relevance to current landscape  Can enhance strategic planning and consideration of the long term fiscal, social and environmental performance and sustainability of an organisation  Opportunity to study and take account of the ‘connections’ in complex service delivery  Can assist in clarifying goals and identifying preferred outcomes  Can support a service user/’customer’ focus  A broader way to look at social value  Compatible with outcomes/impact reporting

16. cipfa.org.uk Some questions …  Is the IR language right for your sector?  How do you understand ‘value’ and ‘social value’?  Can IR provide a single place for stakeholders to can gain a more complete picture of your organisation and its performance?  Can IR help deliver a more concise/focused approach to reporting?  Can integrated thinking be applied internally and if so how?

17. cipfa.org.uk Consider what types of social, economic and environmental value are relevant to your organisation …

18. cipfa.org.uk What to report on …  Agree definition of social value  Clarify the purpose of reporting  Identify the intended readership  Decide on scope of qualitative & quantitative content; and what is and isn’t relevant  Decide how to capture value including relevant measurement where applicable  Decide if useful to monetise value  Seek a balance (positives/negatives; benefits/costs)  Ensure transparency  Does it provide decision useful information?  Review, learn and improve

19. cipfa.org.uk Information on IR and GECES … IR Framework http://integratedreporting.org/resource/internatio nal-ir-framework/ GECES – impact measurement http://ec.europa.eu/social/main.jsp?catId=738&langId =en&pubId=7735

20. cipfa.org.uk Further info from CIPFA …  CIPFA publication on social value  CIPFA discussion paper on measuring and reporting on social value  Ongoing work on measuring and reporting on social value  john.maddocks@cipfa.org john.maddocks@cipfa.org