How can green businesses deliver an effective community engagement strategy?

What role should business play in society?

For some, companies are nothing more than money-making mechanisms that are answerable only to their owners or shareholders and should have scant regard for their wider impacts and dependencies. But the truth is companies have always been rooted in and dependent upon the communities and environments in which they operate, and as such they have responsibilities that extend far beyond those to their shareholders. 

Whether boards realise this fact or not, of course, is another question. But in recent years most companies have become far more aware of how they interact with society, recognising the way they treat clients, workers, suppliers, partners, and wider communities at a local or even international level shapes the risks they face and the commercial opportunities they can seize. Community engagement is now widely regarded as being crucial to a company sustaining its social license to operate, strengthening its brand, maximising its value, de-risking its supply chain, and delivering on its sustainability targets.

For Chrissy Galerakis, head of social value strategy for Equans UK & Ireland, engaging directly with communities and delivering both profits and wider societal benefits is intrinsic to the low carbon energy solutions company's operations.

"As an organisation that does a lot of work in social housing, we're going into people's homes and in many cases retrofitting them," she explains. "And when you're dealing with people, it's not just numbers on a sheet - you're dealing with humans that have whole lives and experiences. As an organisation, it actually makes our job easier if we're able to engage with people meaningfully. We're more likely to get a job done quicker if we're treating people as people. And that's where our community engagement strategy come in."

Galerakis's comments came during a BusinessGreen webinar earlier this month hosted in partnership with Equans UK & Ireland, titled 'How to deliver effective community engagement for your organisation'. The discussion saw experts from across the social value and community engagement ecosystem share their experiences, best practices, and views on how businesses can better work with the wider communities in which they operate.

It is a topic of growing importance to companies of all shapes and sizes. Plenty of investors, public organisations and companies are now both seeking to track and enhance their 'social value' - the often difficult to quantify additional societal benefits generated beyond an organisation's direct activities a project, policy, or procurement initiative. The scope of what might count as social value - or community engagement - is significant, encompassing more or less anything that aims to improve quality of life, well-being and prosperity, including job creation, nature restoration, or efforts to reduce inequality.

Such breadth inevitably makes precisely tracking and measuring social impact a challenge, but the Social Value Portal - which launched the TOM (Themes, Outcomes, Measures) System to help firms track their social value back in 2017 - claims the UK's social value grew by 650 per cent between 2020 and 2023. Altogether, the firm estimates organisations using its portal have collectively delivered around £38bn in social value across the UK since 2016.

For Equans, social value "is not just about what we do as an organisation, but how we do it, and who we do it with", and that includes working with other organisations, suppliers, and customers, Galerakis explained.

"It's who we're hiring, it's where we're spending our money, and it's how we're engaging with the communities in which we're operating," she said. "We want to maximise the impact that we're having in the communities in which we operate, and that goes beyond our projects, to look at actually how we work with those communities, and the presence that we have."

The increasing corporate interest in measuring social value and engaging with communities to drive wider benefits from business operations has been driven by several factors, including mounting regulatory pressures.

For more than a decade now, the Public Services (Social Value) Act 2012 has required UK public authorities to consider how services they commission might improve economic, social, and environmental wellbeing. The legislation was already having 'trickle-down' effect into the wider economy, even before the Public Procurement Act 2023 further strengthened requirements for companies supplying the public sector to demonstrate that they are having positive social impacts.

These regulations - alongside a wider cultural and consumer push for firms to demonstrate benefits to society, backed by an increasing interest in environmental, social, and governance (ESG) metrics among investors - have placed a greater onus on organisations to report on and demonstrate their social value over the past decade, particularly if they want to secure public contracts.

"We think there's a dual drive here [towards social value and community engagement]," said Galerakis. "Both from the public sector, but that's also then influencing and shaping how private markets are responding."

Another driver is the growing B-Corp movement, where a commitment to corporate social value and community engagement is an integral requirement for businesses carrying the B-Corp label. In order to secure B-Corp status, firms are asked to amend their articles of association to ensure a commitment to benefitting stakeholders and communities, as well as shareholders.

Speaking during the webinar, Brigitta Nemes, senior environmental and governance standards manager at B-Lab, the non-profit which manages the B-Corp certification process, highlighted research from the organisation that suggests a commitment to wider community engagement is helping to reap significant rewards for B-Corp firms. SME B-Corps in the UK enjoyed a near quarter increase in turnover in 2023-24 compared to national average turnover increase of 16 per cent for all SMEs, she said. Moreover, the research found B-Corp SMEs saw their employee headcount increase by 9.6 per cent on average, compared to a 0.5 per cent increase for all SMEs over the same period.

"There is also a clear business case," Nemes said. "Stakeholder governance and engaging with the company stakeholder communities is beneficial for business, and not only to help tackle social and environmental issues in the world."

Helen Schoolar, director of strategic partnerships at Jewson Partnership Solutions - which provides building materials and tools to housing associations, the public sector and socially-facing organisations - agreed that providing wider community benefits was far more than just a 'nice to have' for companies. "The lifeblood of our business is community," she said. "Our aim is to make sure we're a cog in that wheel that's making sure that people have got safe and warm homes to live in. That's what we're all here to do, and to improve the communities that we're working in."

To that end, Jewson employs social value managers at its stores, in order to help ensure deep and ongoing dialogue with local communities. Schoolar argued such efforts were critical to business competitiveness for Jewson - helping to both attract customers and clients, as well as boosting staff morale and retention.

"There's absolutely a business case behind it as well as it being the right thing to do," she said. "Turnover of staff within our organisation is pretty low, and I think that's because we are so community focused, and we do work as a team and work with our customers really closely."

Yet for companies involved in housing, energy and infrastructure, one of the biggest drivers behind the push for community engagement remains the need to secure planning permission for new projects. And the government's flagship Planning and Infrastructure Bill looks set to further highlight the importance of working closely with communities on new developments.

The wide-ranging legislation is integral to the government's leading priorities, such as its targets to deliver a clean power grid by 2030 and build 1.5 million new homes this Parliament. As such, it sets out a host or reforms to speed up the planning permission process, which are sure to have a direct impact on how businesses and developers engage with communities to secure support for new buildings, homes, and infrastructure, whether through community benefit funds or even money off energy bills.

These planning reforms could help to speed up the clean energy transition in the UK - but they also pose huge risks to the net zero transition if communities feel they are not being properly consulted on or informed about developments in their areas, warned Galerakis.

"For sure, the changes to the planning processes - the push for building - is going to require a lot more focus on that community engagement to support the transition, to support those changes," she said. "I don't think it's just around new buildings and energy projects, but also retrofit where we're looking at putting heat pumps into people's homes, or putting solar PV onto roofs, changing windows, and all of these types of measures. They're really big changes for people, and so bringing people on that journey so critical to make the transition smoother, but also to make sure that those people really understand and feel those benefits."

So how can companies ensure they have community support for their operations or development projects?

Firstly, companies need to work in partnership with other organisations and communities. Galerakis highlighted a community programme established jointly by Equans and Jewson which has seen the two firms work with a variety of organisations on various projects, including military veterans' charity Stepways. The West Midlands-based organisation needed support to turn a disused shipping container into a community DIY space for veterans, and Equans stepped in to help fit out the facility while Jewson provided the tools. The result was a new space that can provide regular DIY training sessions for veterans. 

"At the end of the day, we provide a certain offer, and it's making sure that we tailor that with our with our partners, with our supply chain, to maximise the impact in communities," Galerakis said. "It does require a lot more investment in the front end, but we do feel, as an organisation that - even just commercially - it makes sense in the long run. If you invest the time in the people and communities in which you're going to be working with, it does it does yield results."

Nemes agreed, adding that efforts to build social value and local engagement should be tailored to different communities based on their specific needs.

"This is really about understanding your community and having dialogue with them," she said. "It is also important to stress that even in aspects where companies might not think that there may be an impact on the community, they still should engage with them on it [in order to avoid the risk of unexpected pushback]. There is no 'one-size-fits-all' solution. You have to tailor and adjust and have regular engagement points and two-way dialogue to make sure that everything goes as expected, and there are no negative impacts that were not expected at the start."

Practically speaking, there is also a lot companies can do to incentivise, track, and report on social value and community engagement throughout their businesses and supply chains. The aforementioned TOMS system is one, while other services such as HACT or Loop also help firms track and measure their social impact. Moreover, companies can also set clear key performance indicators (KPIs) for delivering community benefits or social value in specific areas, and place these alongside measurement mechanisms into contracts with suppliers.

At Equans, staff are also given a minimum of two working days a year that they can set aside for volunteering at charities or in local communities - an approach Galerakis said provides a clear demonstration of investment in society and a means of boosting staff morale and retention. Sometimes, staff take these days in groups together, which means they can also act as team-building sessions. "It does give us, as an organisation of our size, the manpower to commit to supporting certain charities and certain organisations in line with the areas in which we're working," Galerakis explained.

There are, however, inevitably challenges in landing on the right communication strategy for engaging with communities and promoting corporate social impact efforts. After all, the last thing firms want is to be accused of 'greenwashing', or in this case 'socialwashing'. The key therefore is to get the tone and balance correct in any marketing and communications, whether on company websites and social media, with definitive consent required from any communities or individuals involved.

But effective communications can provide a real boost to projects and help demonstrate the business value in community engagement efforts. "A picture says a thousand words," said Schoolar. "I'm always telling my team: if you're doing something, please take a photograph, because we can pop it on social media and shout about the benefits of what we've just done. It makes the community feel great because if they're looking on social media, they see their face there, their community and something they've done together."

What might the future hold for corporate community engagement - is the current focus on social value a short-term trend that could quickly fall foul of the so-called ESG backlash? Or is community engagement already integral to modern businesses and set to become ever more important as the net zero transition gathers pace and more directly impacts people's daily lives?

"I think it's increasingly going to become important to all of us," predicted Schoolar. "I mean, not only is it a legal requirement when you're entering into a public procurement contract, but morally and ethically, it's the right thing to do, isn't it? Because we want to create a world for our children and our children's children for years and years to come, and the only way to do that is to work together."

Nemes agreed, arguing the wider benefits for business and society from deeper collaboration with communities and concerted efforts to boost social value are potentially enormous, providing a means to combat a raft of challenges from climate change and nature-loss to skills shortages and inequality.

"If communities, companies and governments collaborate, then they can really leverage the shared knowledge and resources and just create a multiplier effect and amplify their impact for systems change," she said. "The health of a business is really inseparable from the health of its community and its supply chain, so it's really key to work on that together."

BusinessGreen's webinar hosted in association with Equans - How to deliver effective community engagement for your organisation – can be watched back again in full here.

BusinessGreen has also just launched a new monthly webinar series - BusinessGreen Spotlight – which is set to kick off in September. Readers can now sign up to join the webinars through the BusinessGreen events page.