Making the value case for action towards wider outcomes
How value(s) shape and enable ‘should do’ and could-do’ action
Words by Arup | published in Rethinking Current Practices
This article is part of a series of insights articles focussing on value. It looks at on why individuals and organisations go beyond what they have to do, and the importance of a value case in enabling action towards wider outcomes.
Key takeaways:
- Understanding what really drives action within a wider system is a first step in moving towards more effective and resilient models of governance and stewardship.
- Values play a crucial role in decision-making through influencing visions, missions, principles, agreeing outcomes and shaping direction. they set the framework for subsequent development of a more tangible value case.
- Establishing a strong value case is essential to underpin resilient delivery of wider outcomes and public value.
- Many different outcomes frameworks exist, but these can under- represent water systems and services. Alongside advocacy from within the water sector, there is a need to embed stronger narratives around water within existing values frameworks and valuation methodologies, such as those typically used in housing, place-making and development.
- Monetary value is often the primary component within a value case, but non-monetary value can also be a key consideration. The nature of a value case will depend on the individual or organisation and the delivery context.
- Formal business cases and accounting rules are interdependent with assets definitions and stewardship models.
- Depending on the context, definitions of assets and models of stewardship can have a significant impact on what may or may not be included within a formal value case.
- Unlocking value for individual organisations — the focus of this article — requires an understanding of shared value that is driving increased system integration and partnership working across multiple sectors and scales.
- Emerging insights from the EWSC discovery phase suggest that local government scale may be key to integrating place-based value cases across multiple sectors and scales to enable Water Smart Communities.
1. Introduction
Enabling Water Smart Communities (WSCs) requires action across multiple systems and scales. Across water, housing and other sectors there are many perspectives, aspirations, priorities, obligations, capacities and capabilities that inform how individuals, communities and organisations act.
Early in the project the EWSC team identified three themes as potentially critical enablers: value, assets and stewardship. The three concepts are highly interdependent. When considered together they can help to identify and unlock enabling actions within a complex and constantly shifting delivery environment. They have formed the basis of the EWSC Model.
Our article Rethinking Value gives an overview of some of the concepts, challenges and opportunities relating to rethinking aspects of value within the context of enabling WSCs. This considers the values that shape, motivate and drive individuals and organisations to act, align and collaborate. It also acknowledges the importance of value, both monetary and non-monetary, in supporting the case for individual and collective action.
For each actor within the system, motivations can be grouped into different categories as illustrated below. ‘Can’t do’ actions define the boundary of the diagram — the space of potential action. At the core are the ‘must do’ actions. These two aspects are the focus of the article actors, roles and value(s). The area between ‘must do’ and can’t do’ — shown in green — represents a space of choices and possibilities where action is more strongly linked to value(s) and, in particular, the formulation of a specific value case. This space of potential and the drivers for action beyond core obligations is the focus of this article.
2. From ‘must do’ to ‘should do’ and ‘could do’ …
Why do organisations or individuals go beyond what they have to do? Why do some go further than others? ‘Must do’ activities may or may not align with value(s) since in any case they are not optional. By contrast, the motivations for the ‘should do’ and ‘could do’ activities are more complex and closely related to value(s), as illustrated by some selected examples:
For an individual, going beyond core ‘must do’ activities may be driven by several factors such as:
- Saving money, e.g. reducing water use to save on bills, installing water and energy efficient equipment,
- Managing risk, e.g. investing in household maintenance to avoid leaks/breakdowns, property flood resilience
- Sustaining or enhancing property value, e.g. energy certificates, landscape design, ‘designer’ fixtures etc
- Responding to cultural norms and expectations, e.g. use of hoses, disposal of waste in drains, use of water butts, paving driveways etc
- Investing in self-development, e.g. hobbies, skills, jobs, knowledge, wellbeing
- Care for the environment and wider social outcomes. This may shape individuals’ private actions and also motivate them to take on proactive ‘system-change’ roles in local politics, activism, influencing through social media and so on.
These examples move progressively from actions that are Informed by direct monetary value, through other forms of qualitative value, to more values-driven activity linked to personal principles and beliefs. Preliminary research from the EWSC project academic team has explored existing visions for water smart communities and how they frame concepts of value. Work is also being undertaken to understand how everyday practices in water smart communities influence notions of assets and value. This work will be developed further through the project.
An organisation, such as a water company, developer, local authority, or a community-led organisation, may act based on a similarly complex range of motivations, for example:
- Accessing funding, e.g. creating a business case demonstrating a return from investment in wider outcomes
- Accessing finance, e.g. demonstrating eligibility for green finance/ ethical finance
- Saving on operational costs, e.g. reducing utility bills, investment in maintenance
- Future organisational resilience, e.g. anticipating and adapting to future trends
- Demonstrating credentials to meet tendering or procurement requirements, for example social value commitments
- Responding to incentives, e.g. from water companies to developers and/or customers
- Customer/ consumer expectations, e.g. water efficiency, circular economy, net zero, affordable homes, equity and inclusion
- Member / employee expectations and values, e.g. social value, volunteering, ethical practice etc
- Acknowledging citizen and wider cultural expectations, e.g. net zero targets, sustainable farming, water footprint, affordable homes
- Actions shaped by core culture, vision and values, e.g. water sector exploring the social contract, and ‘purpose driven’ approaches
Again, these selected examples show that for organisations motivations can range from those linked very closely to tangible value such as a developing a robust financial/ business case or reducing costs, to progressively more ‘optional’ values-driven activity and ambitions.
3. A value case is critical, and is shaped by values
Values set the context and shape what it is acceptable to explore, enabling wider cultural shifts and driving the frontiers of research, innovation and practice. Values play a crucial role in decision-making through influencing visions, missions, principles, agreeing outcomes and shaping direction. They also set the framework for subsequent development of an enabling value case — often influencing how value is defined, assessed and used to enable action and evaluate outcomes.
Individual organisations or citizens are influenced by their socio-cultural and political context - by collective value(s). For example, an organisation might need to comply with government business case rules and definitions of value to secure funding. However actors can also shape this wider context by driving change through their actions. An example might be community-led innovation in housing and stewardship that shifts perceptions and challenges existing value models (e.g. CLTN 2024). Another example might be values-driven organisations creating demand for green finance. The EWSC Framework recognises these different scales and types of action.
Understanding and being honest about what drives individual action within a wider system is a first step in moving towards more effective and resilient models of governance and stewardship, particularly when working in partnership with others.
Much, if not most, non-mandatory ‘should-do’ action is in fact unlocked by an understanding that some form of value will be returned to the actors involved — it depends on an individual value case. How that value case is made, however, is strongly influenced by values — either of a particular person or organisation.
In an increasingly complex delivery environment with many different views, multiple competing demands and accelerating pace of change, exploring and aligning values, and linking these to value and outcomes can be the hardest and most crucial first step.
3.1 Case study: the Wellbeing of Future Generation Act
In 2015, the Welsh Assembly introduced the ground-breaking Wellbeing of Future Generations Act, which provides ‘the ambition, permission and legal obligation to improve our social, cultural, environmental and economic well-being’. Importantly, the Act frames this within the context of considering long-term planning and intergenerational stewardship.
Moreover, the Act recognises the importance of ‘…shaping ambition and creating a delivery environment that gives permission…’, demonstrating the importance of establishing values to encourage widespread action beyond the minimum duties and requirements and empowering different actors to explore better outcomes beyond business as usual. The Act asks public bodies to ‘think about the long-term impact of their decisions, to work better with people, communities and each other, and to prevent persistent problems such as poverty, health inequalities and climate change’.
The Well-being of Future Generations Act is already having an impact on culture and practice beyond the core legal obligations for public bodies. Welsh Water, for example, have developed their business plan in accordance with the Act and are aiming to ‘contribute significantly’ to its goals through their ‘Well-being Commitment’. Whilst the Act doesn’t place statutory duties on Welsh Water, it has clearly influenced their values and shaped ‘should do’ activities for the non-profit organisation.
The requirement of the Act for different actors ‘…to think about…’ such complex overlapping challenges highlights the importance of robust conceptual frameworks and ‘mental models’ to enable this to happen, along with methods to align values, assess value and monitor outcomes.
A Wellbeing of Future Generations Bill (2022) is currently passing through the House of Commons, which may result in similar legislation being rolled out across the UK, leading to similarly positive ripple effects.
4. Value(s) and outcomes frameworks
A range of different frameworks and methods exist to explore and communicate value(s), shape action, evaluate outcomes and assess benefits/value creation. Within the built environment and infrastructure sector, these have often been driven primarily by environmental and sustainability considerations. Recently, these narratives have expanded to emphasise other critical challenges, adopting various lenses and starting points, from sustainability and regenerative design to health and wellbeing, social value, quality of life, equity, inclusion, resilience, public value and so on. In the EWSC resources repository we have compiled a live list of examples of industry-wide frameworks.
Many of these approaches are addressing and often challenging conventional notions of value and values, with a positive impact on the way that individuals and organisations create their own value case and evaluate outcomes and thus how they act within a wider system.
By facilitating conversation, exchange and collaboration across multiple sectors and different points of view, such framings point to a future in which a more expansive and less siloed approaches may drive action. Increasing focus on participatory design, citizen engagement and including mechanisms such as citizen’s juries and asset-based community development can be supported and amplified by frameworks and tools to explore shared value(s) and prioritise actions.
Whilst recognising the positive shifts represented by all of the above examples, it is important to acknowledge the challenges that come with this. Complexity and overload from many overlapping ‘missions’, ‘lenses’ and associated conceptual frameworks can be a real challenge both for individuals and organisations. An opportunity for the EWSC project will be to help different actors navigate this increasingly complex and fast-moving delivery environment and understand the place of water within it.
5. Considering water within the wider system
Recently, political and cultural focus has consolidated around carbon, energy, circular economy and more recently biodiversity with a strong emphasis on enabling health equity, wellbeing, social value and inclusive economic growth. Water is fundamental to many of these outcomes. The RIBA Climate Guide is a recent example of water challenges and design principles being clearly addressed within an overall climate and sustainability narrative. Other outcomes frameworks within the housing design and delivery context may consider water indirectly as part of more general categories such as ‘nature’ or ‘environment’. In many frameworks water does not feature strongly, and sometimes it is not considered at all.
Whilst water is rising up the agenda in the UK, it is not yet a primary consideration in many of these narratives and methodologies for planning and place-making. In this rapidly changing environment however, issues like surface water flooding, leakage, bathing water quality, nutrient neutrality and water scarcity can emerge swiftly as issues, depending on the context. Despite these shifts that are pushing water up the agenda, it often remain lower on the overall list of priorities.
A water focussed-lens can sometimes be a helpful entry point for unpacking the interdependencies between water and other sectors such as housing and place-making. In the EWSC resources repository we have compiled some examples, ranging from Ofwat’s Public Value Principles and the Defra Plan for Water, through CIRIA’s Water Sensitive Urban Design Guide and guidance on Integrated Water Management , to the City Water Resilience Approach and the large body of work by CRC for Water Sensitive Cities in Melbourne, Australia. These frameworks and documents indicate general sector-wide trends towards more holistic outcomes-led planning and design.
Arup’s Design with Water framework is another such example being used to support the EWSC project. It helps to explore how water can be a catalyst and enabler for exploring shared values and demonstrating wider value creation. Depending on the stakeholders and context it can also be used to enter the process from other perspectives by looking first at place-based values and desired outcomes before exploring links to water systems.
Alongside these water-focussed approaches, the EWSC project will be exploring how most effectively to embed stronger narratives around water within values frameworks and valuation methodologies used by other sectors, such as those described earlier in the article.
6. Making the value case for undertaking ‘should-do’ and ‘could do’ actions
Many of the above outcomes frameworks are being used to explore and align values leading to more holistic approaches, but how can they be used to make the clear value case for action beyond ‘must-do’ obligations? This is a complex and rapidly developing area, but some themes are discussed briefly below.
Our article actors, roles and value(s) discusses how, in some cases, the best way to guarantee actions towards wider outcomes may be to mandate their delivery by a particular actor. The Ofwat PR24 Performance Commitments for water companies, especially those with financial penalties attached, serve as practical examples of this approach in action. These are being extended to cover aspects such as net zero operational carbon and biodiversity (which now a legal requirement for the housing sector). However, for the water companies, as for other sectors, many wider, whole-systems outcomes beyond core duties are not mandatory. Ofwat state that water companies should look to deliver their Public Value Principles, without mandating it, relying instead on individual companies to deliver. For water companies, as for most individuals and organisations, this means action will happen when values and desired outcomes are translated into a strong enough value case supporting their own action and investment.
6.1 Monetised value
Currently, the most effective approach to ensure the delivery of non-mandatory outcomes is likely to be linking them to some form of economic or financial incentive, either at an individual or corporate level. While some may dispute the idea that every outcome can or should be monetised — as discussed in Reith Lectures by Mark Carney, 2022 — it is undeniable that within the current system, monetising benefits increases the likelihood of their prioritisation and inclusion in personal or organisational action plans. This is particularly the case with private organisations, such as water companies in England or private housing developers. In practice this will be the case most organisations including public sector organisations such as Local Authorities or the Environment Agency.
Within the water industry capitals accounting is being widely adopted to assess and, increasingly, to monetise value. The CIRIA BeST tool is another water sector example, that supports monetising the wider benefits of blue and green infrastructure. Local authorities, NHS and other institutions are increasingly using similar approaches as they consider their role as anchor institutions supporting local wealth-creation and positive place-based outcomes.
Techniques for assessing and monetising a wider range of outcomes are becoming more sophisticated and more widely adopted as a way to make the financial case for investment in action beyond the core performance.
Monetisation of wider benefits — whilst increasingly being used as evidence for strategy and decision-making — cannot necessarily be included in the core business cases and accounting models. As discussed in our article on rethinking assets, definitions of assets and models of ownership and stewardship can have a significant impact on what may or may not be included within a formal value case.
Despite new methodologies for monetising a wider range of and outcomes and benefits, it could be argued that models solely relying on monetary value, whilst very important, are insufficient for assessing the ‘total value’ delivered through investments in infrastructure such as water or housing.
6.2 Non-Monetary Value
Typical approaches to assessing value tend to adopt parallel processes of a core business case based on monetary value and associated more qualitative assessment of non-monetary value. For example, the rules for Flood Risk Management funding, until recently, only allowed monetised benefits to be included in economic business case. A sustainability or environmental assessment would then assess non-monetary outcomes across a range of social, environmental and economic factors. A wide range of quantitative and qualitative methods can be used for assessment of value creation in non-monetary terms.
From 2023, the updated Treasury Green book allows non-monetised benefits to be included in business cases. The extent to which this shift influences actual decision-making and action remains to be seen. It will likely take a while before qualitative or quantitative non-financial evidence have equal impact as financial metrics. However, there seems to be increasing openness and traction, in theory at least, towards non-monetary value having a greater influence in driving decision-making.
In practice, this balance will depend on the nature of the organisation, e.g. public, private, commercial, non-profit, ‘mission-led’, community-led etc. and their delivery context. The EWSC project is exploring different housing delivery models, recognising the difference, for example:
- between a commercial developer requiring a short-term return on investment within conventional market conditions,
- a social landlord with a long-term interest in assets and responsibility for wider outcomes such as tenant health and wellbeing,
- and a more values-driven community-led organisations, such as Community Land Trusts that may challenge conventional value models.
These different perspectives will influence the extent to which these different actors include monetary and non-monetary value in the case for action.
Similarly the value case for a local authority investing in place-based outcomes may be different to the justification required by a private water company. The primary driver for ‘capturing’ wider non-monetary value is often to support a particular organisational or project investment case. Nevertheless, demonstration of value created beyond a particular project — value created within the wider system — is becoming important for other reasons such as discharging ESG commitments to investors, credibility to secure ethical or green finance, demonstrating a commitment to social value, reputational drivers, customer expectations and so on.
For individuals, such as homeowners or tenants such judgements will depend on their values and those of their social context. The capacity and agency to act beyond ‘do minimum’ or invest based on potential financial or non-financial value will depend a lot on personal circumstances. A key part of this project will be to explore the motivations, capacity and agency for action amongst individuals and communities involved in enabling and living with water smart communities.
6.2.1 Case study: Kennett Community Land Trust — Kennett Garden Village, UK
This 500 home development in East Cambridgeshire is led through local people In partnership with the landowner, local authority and developer. The Kennett Community Land Trust (CLT) is involved in the design, commissioning and development of the site, ensuring that the site is developed with the community, for the community. The development will be low density and high-quality, with new open spaces and highway improvements that were sought by local people during the planning process. All of the parties involved are committed to deliver a near net-zero carbon development, with homes that are energy and water efficient, heated by air-source pumps, and benefiting from solar panels and electric vehicle charging. The development will also enhance the natural environment to achieve a net-gain in biodiversity, with a range of newly created, accessible green spaces and sustainable urban drainage systems. Kennett CLT will own and manage at least 33% affordable homes and all open space and community amenities within the garden village development. Organisations such as the Community Land Trust Network (CLTN) are bringing together and enabling many examples of innovative community-led stewardship that challenge conventional value models.
7. Making the value case across different sectors and scales
Outcomes can be delivered and a value case can be made at different scales, depending on the actors involved and their roles within the system. Water smart communities will typically be created at the neighbourhood scale, however, we are learning that the value case supporting their delivery may need to made at multiple scales, often working in partnership. This is illustrated conceptually below.
Within the water and environment sector there has been significant focus on catchment scale partnerships and value models, including the Catchment Based Approach and a recent example of a Catchment Market Place unlocking local housing developments through delivery of nature-based solutions.
Emerging insights from EWSC suggest that local government scale may be key to integrating place-based value cases across multiple sectors and scales to enable WSCs. This might include new shared value models led by those with a strong civic mandate and direct accountability to local people and places, supported by local anchor institutions with a focus on building local community wealth. These themes are being explored further as part of the enabling actions workstreams.
This article has focused primarily on drivers for individual action beyond ‘must-do’ obligations. It has highlighted that values frameworks are critical to drive direction, but establishing a strong value case is also essential to enable action and evaluate outcomes. Unlocking value for individual organisations requires an understanding of shared value leading to greater system integration and partnership working. Addressing the challenge of EWSC requires a shift from the individual to the collective, working across multiple systems and scales as set out in the EWSC framework.
This article is written by Arup, a collective of designers, architects, engineering and sustainability consultants, and experts dedicated to sustainable development. Arup brought water and housing specialisms together with strategic design capabilities to rethink how we define values, assets and stewardship to unlock opportunities for enabling Water Smart Communities (EWSC). This is one of three on the topic: see Rethinking Value; and Actors, roles and value(s), for more.
As Discovery research lead and series editor, Arup’s Transformation & Design Studio led the multi-partner research effort contributing public innovation and strategic design expertise.
This is one of a series of insight articles produced as part of the EWSC innovation programme, exploring how integrated water management can be delivered through innovative housing and stewardship models. To explore related articles and reflections browse our publication. For an overview of the project, latest news or to get in touch visit https://www.ewsc.org.uk/.
