What does the term "social value" refer to in the context of contracting?

The term "social value" in the context of contracting refers specifically to the benefits that an organization can create for society beyond the immediate financial outcomes of a project or contract. This encompasses a wide range of positive impacts, such as improving community well-being, promoting equality and inclusion, enhancing environmental sustainability, and fostering local economic development. By recognizing and integrating social value into contracting processes, organizations can make decisions that not only fulfill their contractual obligations but also contribute to the broader social fabric.

In many modern procurement frameworks, especially in public sector contracting, the assessment of social value allows organizations to evaluate how their suppliers contribute to social, economic, and environmental outcomes. This concept aligns with the growing emphasis on corporate social responsibility and stakeholder engagement, which seeks to ensure that businesses operate in a manner that is beneficial to society as a whole.

While economic advantages, increased corporate profits, and reductions in operational costs are important business considerations, they do not encompass the full breadth of what social value entails. Social value focuses on the collective benefits to society, which can lead to a more sustainable and equitable outcome in both contracting and community engagement.