Social Return on Investment Analysis on the Metro Tunnel Project: CYP D&C– A Case Study
By Fiona Bowie, Sustainability Lead and Kate Rowan, Sustainability Advisor
Social sustainability initiatives are some of the hardest to measure the economic return, nor are they traditionally within the remit of infrastructure projects. In delivering the Metro Tunnel Project’s Tunnels and Stations package of works, managing contractor CYP Design & Construction (CYP D&C, a joint venture comprising Lendlease, John Holland and Bouygues Construction) wanted to change that, and so has sought to independently verify the economic return on three social sustainability initiatives through a Social Return on Investment (SROI) analysis.
Image: Metro Tunnel Project Cadets
What is a SROI Analysis
Social Return on Investment (SROI) is a rigorous, evidence-based framework for measuring the social value created through investment in social sustainability initiatives. It identifies and measures the immediate and long-term social outcomes experienced by key stakeholders such as lasting change in employability and improved capability and performance for the construction sector.
The SROI Method
Social value is calculated by placing a financial value on the quantified change using what are known as financial proxies. SROI seeks to understand all types of value – social, economic and environmental – and represent this in a language which is widely understood by funders, investors, policy makers and decision makers.
CYP D&C is undertaking a ‘book-end approach’ which includes both a Forecast SROI, analysing activities in the early stages of implementation (completed December 2019) and an Evaluative SROI, a summative analysis of the life of the Tunnels and Stations works package (near project completion). This method is considered to be a world-first for a large infrastructure project. Its use will give CYP D&C the capability to measure the effectiveness of social sustainability initiatives in creating the intended and unintended changes for key stakeholders and capture future improvement opportunities.
The three CYP D&C social sustainability initiatives under analysis are:
- Social procurement through project engagement of social enterprises and Aboriginal businesses;
- Employment opportunities provided for priority jobseekers; and
- Training and employment of trainees, apprentices and cadets.
Image: SROI Assurance Statements
The Forecast SROIs showed that CYP D&C’s activities have created positive social and economic return for all stakeholders for all three initiatives. In particular, analysis forecasts that for every dollar CYP D&C invested in the Priority Jobseekers initiative, $4.76 of social and economic value is created. The social procurement initiative similarly achieves a positive return on investment, with a forecast return of $4.02 of social and economic value for every dollar invested by CYP D&C.
The beneficiaries of employment and training (priority jobseekers, trainees, cadets, and supported employees of social benefit providers) are empowered by a sense of belonging, greater confidence and increased aspirations and thus their future employability improves. They are likely to experience faster career development and have greater financial freedom and lifestyle choices. In some cases, they may experience improved physical and mental health.
Other key stakeholders also experience social and economic benefit, including:
- The government, which benefits from a reallocation of welfare benefits, employment and social services costs, and increased tax revenue as people come off welfare and into meaningful employment.
- CYP D&C and its supply chain, who develop an increased ability to attract and retain a skilled workforce that can perform to targets.
- Social benefit providers, who are able to become more sustainable in terms of business and workflow.
- The construction sector on the whole, which subsequently benefits from a greater pool of talent and resources.
Through this process CYP D&C received feedback from the people participating in the social sustainability programs, including:
- ‘’Before this Traineeship I was self-critical and didn't have faith in myself, let alone what work I am capable of.’’ - Pathways trainee
- “I feel like I know what I’m supposed to be doing now. There is a fit between what they want and what I can do.’’ Cadet
- “It’s about breaking the cycles of unemployment that people are often trapped in. It is the thing that excites me the most about what we are doing. We’re hearing feedback almost weekly now on the changes that young people or parents are experiencing now we’ve given them a chance” - CYP D&C Manager
- “[Without CYP D&C] I would be stuck in limited, unreliable, employment – in a profession I never planned to work in. I would not be utilising my skills and past experience to anything close to my potential.” – Priority Jobseeker
- “[Working with priority jobseekers has] changed the way we address things, the way we talk about people, changed the mindset about how people are different” -Supply chain representative
The quantitative and qualitative results of the SROI analysis rigorously demonstrate the positive impact of the social sustainability initiatives offered as part of the design and construction of the Metro Tunnel Project. These programs and their impact will become a legacy of the project, and will change how infrastructure is delivered in terms of social sustainability. The SROI analysis is a valuable tool in recording, measuring and communicating that legacy to ensure such social initiatives are included in future projects.
For more information on the Social Return on Investment analysis, please contact the CYP D&C Sustainability Team at email@example.com
Learn more on ISCA's Return On Investment Study
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