This discussion paper was developed by Social Value UK.
“Approaches to understanding and valuing social and environmental value have evolved considerably in recent years. Two principal frameworks are Social Value International’s Social Value Framework, which primarily focuses on social value, and the Natural Capital Coalition’s Protocol, which primarily focuses on natural capital. By understanding these two approaches and how they relate to one another, users can more easily understand how to use them together to account for the changes that matter.”
Jeremy Nicholls, Executive Director, Social Value International
“All of the capitals are connected and it is impossible to separate one form of capital from another. There is already significant compatibility between the Social Value International approach and that of natural capital and I look forward to building even closer connections in the future.”
Mark Gough, Executive Director, Natural Capital Coalition
“In response to the dramatic disruption and depletion of natural systems by economic activity, better ways of measuring, valuing, and managing the natural systems upon which our well-being relies are clearly needed. Several frameworks and tools have been developed to address this challenge. Among them, the Natural Capital Protocol (hereafter ‘Protocol’), launched in July 2016, has harmonised other approaches to enable businesses to assess the impacts and dependencies of their activities on Natural Capital, and this has gained traction globally. Alongside this, Social Value International’s Social Value Principles and methodology, whilst always accounting for both social and environmental change, have focused primarily on social change.
This paper seeks to explore the level of similarity between Social Value Principles and Framework and those of the Protocol. It is hoped that this document will provide a useful point of reference for practitioners who face the challenges of measuring both environmental and social changes.
By articulating the ways in which the two approaches relate to each other and by recognising their differences practitioners can compare and decide whether either approach, or both, makes sense for a given problem or decision-making context.
Similarities between the two approaches:
- As opposed to rules-based approaches that prescribe specific measures which must be used in all cases, both approaches broaden the types of information considered as part of the decision-making and evaluation processes.
- The two frameworks take similar positions on value as regards relative importance, worth or usefulness. They both also recognise that this approach can help set out the concept of value as well as addressing some of the issues/need for caution when using techniques to monetise change.
- Both approaches have conceptual models that rely on similar ways of structuring/assessing the issue being considered, which helps measure the change or establish the impact involved.
- Both approaches ask practitioners to consider what is material (most important) given the context of their work.
- The purpose of both frameworks and sets of principles is to improve decision-making relating to resource allocation by taking into account the material outcomes that will result from the allocation of those resources.
- Both the Protocol and the Social Value Principles and Framework agree that when the reasons for the decisions that have been made are transparent, then the analyses are more credible.
- Each framework sets out how to determine environmental change and its impact on different stakeholders in similar ways.
- The Social Value Principles and Framework are not business-centric; the Protocol is.
- The Social Value Principles and Framework promotes the involvement of stakeholders in the process of defining and valuing the material social outcomes in order to obtain a holistic perspective of value. The Protocol also promotes stakeholder involvement but allows the practitioner to choose which perspective of value to apply.
- The Protocol sets out the decision-making contexts that a practitioner may be addressing while the Social Value Framework leaves this open.
- The Social Value Principles and Framework outline the need to identify the dependencies between inputs and outcomes for stakeholders. However, they do not explicitly cover the dependencies between different stakeholder groups in the value chain in the way the Protocol does.
- The Protocol puts natural capital (the natural stocks that deliver services for the benefit of people) at its centre, whereas Social Value Principles put societal value at their centre. Both approaches recognise the interconnectivity of the different capitals.
- The Protocol recommends that the audience should be appropriate to the decision being informed, whereas the Social Value Principles and Framework consider all substantially affected stakeholders as an audience – even those without power in a given context.
- Social Value International offers an assurance regimen to ensure that reports faithfully follow its principles, while the Natural Capital Coalition does not. The Protocol offers practitioners advice on verification, but this is not prescriptive when compared with the detailed and specific Social Value Assurance Criteria…”
Read the full discussion paper at Social Value UK.