The future looks purposeful

Social capital, social purpose, social impact, social value. Over the past five years, these words have been heard with increasing frequency, and for compelling reasons. We are at a crossroads for the role of business, and of buildings, in society. On the one hand, there remains low trust in business after the financial crisis and accelerated transparency in a digital society, coupled with the desire from millennials to work for companies that make a positive impact. On the other, we have a state stretched beyond its means to deliver affordable housing, social care and healthcare in the face of an ageing population. Firms that have recognised these trends will deliver both the greatest social impact and best long-term financial resilience for their businesses. A shifting relationship This is not the first time that the relationship between business and society has shifted. In the Victorian era, the private sector often provided a social safety net that the state did not have the resources to deliver. The next shift came in the early 20th century when the expansion of the welfare state narrowed the ethos of businesses as social providers. Since then, most Western governments have assumed a key role in promoting the social wellbeing of their citizens. However, the balance of responsibility for social wellbeing has started to transfer back to the private sector again. Supporting this change is a significant uptick in legislation covering areas as varied as company disclosure, skills, diversity, community infrastructure and place-making. To take one example, the Public Services (Social Value) Act 2012 asks those who commission public services to consider how they can secure wider social, economic and environmental benefits, rather than focusing purely on cost. For those tendering for public sector contracts or looking to develop land in partnership with the public sector, they may find that an increasingly heavy weighting is put on their ability to demonstrate social value. How is the real estate sector responding? For everyone reading this article, I would imagine that it was a driving assumption that the urban environment makes a huge impact on people’s lives, for good and bad. A high-quality built environment – with accessible local services, affordable housing, a great public realm and green space – supports a community’s health, social and cultural wellbeing, economic opportunities and people’s quality of life. Since 2012, we have seen in-depth socio-economic assessments being carried out on developments and existing assets in the UK. Companies such as Hammerson, Berkeley Group, the Crown Estate and M&G have undertaken portfolio-wide assessments, whereas others such as Derwent London, TH Real Estate, Legal & General and Landsec have focused on individual asset assessments, both before and after renovation or development. Positive stories about public (or private) realm improvements, job creation and local economic contributions are being told, while negative social impacts are increasingly benchmarked and understood. JLL’s Upstream Sustainability Services team has measured the socio-economic impacts of more than 1,000 assets. The sheer scale indicates that we are at the tipping point whereby assessing – and improving – the socio-economic impact of an asset could become mainstream. The rise of social purpose and impact Business has long recognised that fundraising and volunteering can generate employee engagement and improve reputation with clients and prospective employees. But a significant change in emphasis is under way. First, across all types of business, we are seeing an increase in explicit social purpose. In real estate, one of the best examples comes from Legal & General with its intention to “help our customers achieve financial security while being economically and socially useful”. Meanwhile, the property industry’s charity LandAid has the same underlying desire for impact by setting its goal “to end youth homelessness by 2026”. Second, volunteering and pro bono programmes have been coming to the fore. Behind this trend is a recognition that volunteering supports better engagement with the diverse communities shaping our workforce and with the communities whose lives real estate is shaping. Getting out of the office to see social challenges through the eyes of a charity volunteer teaches new skills and perspectives. There is also a financial driver at play. According to YouGov, employees actively engaged in community programmes are more satisfied in work, with 85% saying their perception of their company had improved. This is backed up by JLL’s own experience: 73% of staff who responded to JLL’s feedback survey last year reported that volunteering had increased their pride in the company. This is surely why organisations such as Lendlease and British Land target and achieve volunteering rates in excess of 80%. As another example, it is also why the Building the Ark project for Noah’s Ark Children’s Hospice in Barnet, EN5, has received incredible support from construction and property firms through providing services either pro bono or at a discounted rate. Finally, there are a growing number of real estate companies assessing their community investment and then considering how that money, staff time and in-kind contributions of space can be used to generate the best community outcomes. Each year, JLL UK contributes the equivalent of £700,000 of money and staff time to charities, in addition to the £300,000 per year raised by staff through fundraising efforts. However, at JLL, we want to ensure this circa £1m achieves the greatest community impact. This has led to us identifying four areas – housing and homelessness, urban regeneration, education and skills, and access to the profession – where we are now focusing our efforts with organisations such as Crisis and Enabling Enterprise in order to achieve the greatest social change possible. The future Undeniably there are major societal challenges facing the UK and the role of business in society is certainly changing. The industry has huge potential for social good if it sets its mind to its social purpose with dynamism. Leaders in the property industry are alive to the major demographic, political, digital and social trends, and are seeking to respond with intent. From here, the future looks purposeful.