Insights

The human development argument.

I believe one of the main challenges in our industry today is finding ways to create value – rather than just profit – and how we share that value with all spheres of society.

Business schools now teach their students that companies have an overarching social and economic purpose that transcends profit maximisation. This includes producing goods and services to meet needs, creating high quality employment, or making a positive contribution to the social and physical environment. Arguably, our industry has struggled with this so far because it’s a discussion that begins in the ethics and economics sphere.

We all understand how responsible our industry is for shaping, designing, and delivering the places and buildings we live in. Putting this realisation into practice, however, is another matter.

Using innovation purposefully and making the most of technological advancements will mean our industry develops not only new solutions, but solutions that are integrated into public policy agendas, and commercial and viable models that ensure scalability and impact.

Unlocking this will demand better ways of working, and a key aspect of this is how we – ultimately – measure success.

A bigger boat.

Despite the growth of corporate social responsibility, most businesses in our industry consider delivering the project on time / within budget, and hitting individual short-term profit targets the ultimate measure of success. Of course, that’s only right… but I believe we can, and should, spread this much wider to encompass measures that are more impactful.

Can we look to other sectors for ways of doing this? Certainly, the ‘human development’ argument, which proposes a new paradigm for economic policy, is one route. This approach, developed in 1990, shifted the discourse from pursuing material opulence to enhancing human wellbeing; from maximising income to expanding capabilities; from optimising growth to enlarging freedoms. It focuses on improving the lives of people rather than assuming that economic growth will automatically lead to greater opportunities for all.

Can we use this principle as a definition of success for our industry? In the same way that the Social Value Act has influenced public services (the Act requires people who commission or buy public services to consider securing added economic, social or environmental benefits), the Human Development Index could work for businesses.

It’s certainly a strong measurement tool; it integrates three dimensions of human development – health, education, and income – into an aggregate index. Our work shaping the built environment can influence all three of these areas, so is it time we started measuring these impacts for ourselves? Perhaps including them in our financial reports?

This fundamental shift may take time, but one that’s highly likely as an outcome of society’s development and evolving priorities. Ultimately, as public policy increasingly focuses on wellbeing and social growth, our businesses and industries will start to be held accountable for more than just our profit: in other words, the social impact we make.