Wellbeing is the future of social value, with people underpinning every aspect of social value and your wider operation. All roads lead back to the happiness, fulfilment, safety, and health of individuals. Whether that’s your staff, residents of the communities you operate in, or people across the globe who are impacted in some way by your organisation’s supply chain.
It’s a critical aspect of any organisation’s quest towards stronger ESG involvement and a more sustainable, ethical operation. As such, a reliable, robust way to measure wellbeing is critical to understanding the true impacts of your actions and interventions.
But what exactly is wellbeing? And how can we best measure it?
What is wellbeing?
Wellbeing can be difficult to understand, define, and measure. The term is largely abstract and wishy washy, while also being something we understand deeply and innately. It’s as simple as asking “how do I feel today?”
It’s how fulfilled and happy we feel on a daily basis. How safe and secure we are in our lives. Whether we feel connected to our local communities and are optimistic about the future. Whether our children have the opportunities and resources needed to thrive, both now and for years to come.
In the government’s guidance surrounding their new Social Value Model, they explain the ‘wellbeing’ theme as follows:
“[The government] wants all people to be able to thrive, connect with each other, and give back to their communities, whilst having a sense of control over their future and that of their community. As part of its drive to level up the UK economy, government is committed to enabling communities everywhere to collaborate with local private and public sector organisations in creating a shared vision for the places in which they live and work.”
In a lot of ways, wellbeing is a subset of sustainability. The two very much go hand in hand. To ensure the longevity of our planet and civilisation, we need individuals and communities that are thriving. In this sense, human, planetary, and business health all interlink.
A wellbeing framework
The Supply Chain Sustainability School has created a framework for wellbeing which we think is useful when defining wellbeing. It consists of the following themes:
- Purpose – connection with local communities and nature. Being able to set goals and having access to the personal development needed to reach them.
- Environment – access to nature, natural light, inclusive buildings, and healthy ventilation.
- Security – physical and psychological safety, as well as social connectivity and support.
- Health – healthy behaviours such as sleep, nutrition, and physical activity. High-quality hygiene and access to mental, physical, and social health support and resources.
- Relationships – solid foundations for communication, diversity, and inclusion, and knowledge and learning opportunities.
Can we put a price on happiness?
Measuring the wellbeing of individuals is no easy task. We all have different life experiences and perspectives on the world. And something so intangible as wellbeing can feel impossible to quantify in such simple terms.
Which is where economic equivalency comes into play. This involves measuring wellbeing by picking a monetary value that could improve a person’s quality of life equally to what a certain intervention would. For example, an extra £1,000 on a person’s salary might provide the same boost to their wellbeing and outlook on life as the creation of a green space and place to walk in their local area would.
This can be a powerful way to approach wellbeing measurement. It allows organisations to easily perform cost-benefit analysis on their interventions, comparing results, and therefore better allocating their time and resources.
But this approach also has some limitations which are worth considering.
Moving beyond numbers
Figures-based analysis can oversimplify wellbeing, missing the human-level, tangible impact of interventions. Getting too caught up in numbers and percentages, organisations miss out on the wider story of their interventions and what outcomes have actually been felt by the people they’re striving to help.
It also makes it harder to understand the variation in wellbeing across individuals, communities, and countries. If we use proxy values – arbitrary figures taken from value banks – there’s no space for individual variance.
The government addressed this in their Supplementary Green Book Guidance:
“Factors do not influence people in the same way. Initial wellbeing levels play a role. Evidence suggests that those who have lower wellbeing show a greater increase in wellbeing when they participate in cultural activities or spend time in green spaces. It also depends partially on characteristics, for example, the impact of employment on wellbeing depends on personality, values, gender, age, among others.”
And, finally, by chasing high numbers rather than tangible outcomes, organisations can end up excluding valuable initiatives in favour of ones they know perform well. We can end up led by ROI, rather than the most pressing needs and wants of beneficiaries. But if proxy values and financial metrics overlook a lot of valuable nuance, what can we use instead?
In the UK, the emerging WELLBY system provides a fresh alternative. While it’s metric-based, these metrics are centred around survey questions, not vague numbers. Rather than making sweeping statements about people as a whole, you still get to glean individual insight from your beneficiaries on how your actions have impacted their lives for the better.
The What Works Centre For Wellbeing describe WELLBY as follows:
“The Wellbeing-Adjusted Life Year (WELLBY), which aggregates changes to life satisfaction over time and population, can be used as the main unit of benefit to the UK (one unit of life-satisfaction for 1 individual on a 0-10 scale for 1 year).
Policies and spending would be evaluated and appraised by comparing the change in WELLBYs against costs to the public purse. Different policies could be compared and ranked based on this ratio.”
What can WELLBY do?
Using a life satisfaction scale of 1-10, WELLBY is a far more robust, nuanced way to measure wellbeing. It helps you take any action or intervention and calculate a pounds and pence figure of improvement. One that’s based on the exact group of individuals you’ve helped – or set out to help. It takes all the guesswork out of measuring and quantifying wellbeing. And is a much-needed step forward in finding a more robust, nuanced way to capture and measure wellbeing and, on a wider scale, social value.
We still have a lot to say when it comes to wellbeing and it’s importance when considering your organisation’s social impact. So check back next week where we’ll be discussing the value of taking a blended approach to your social impact and wellbeing measurement, as well as actionable next steps for creating a robust, long-term wellbeing strategy.
Impact is the only platform that allows organisations to qualify their numbers across social, environmental, and governance disclosures. We’re also embedding the WELLBY system directly into Impact, empowering you to measure, monitor, and analyse your social value like never before. To find out more, schedule a demo or get in touch with the team on 0161 532 4752.