Ensuring Social Sustainability in Construction Supply Chains

Ensuring Social Sustainability in Construction Supply Chains

Ensuring a commitment to health and safety is a well-established practice. However, as Alex Minett, Global Head of New Markets at Veriforce CHAS, explains, companies are increasingly being held accountable for their suppliers’ sustainability practices.

This shift makes robust prequalification processes and social sustainability assessments essential.

A brief history of supply chain prequalification in the UK

The concept of supply chain prequalification has a storied history in the UK, evolving significantly over the past few decades. Initially, the focus was mainly on ensuring contractors met basic health and safety standards.

This led to the introduction of schemes such as the Contractors Health and Safety Assessment Scheme (CHAS) in 1997. CHAS was developed to provide a standardised method of prequalifying suppliers and contractors, ensuring they complied with essential health and safety regulations.

The scheme helped to mitigate risks on construction sites and established a baseline for contractor competence and reliability.

The growing importance of social sustainability in supply chains

In recent years, the scope of supply chain assessments has expanded beyond health and safety to encompass a broader range of issues with a strong focus on social sustainability – the impact that businesses and their supply chains have on people and communities. This includes working practices, human rights, community engagement, and ethical sourcing.

The increasing awareness of corporate social responsibility (CSR), the rise of socially conscious consumers and the risk of reputational damage have driven companies to ensure that their supply chains reflect their values and commitments to social sustainability.

Key questions to ask your supply chains about social sustainability

To determine whether your supply chain is truly committed to social sustainability, and how that commitment translates to actions, it’s essential to ask the right questions. These could include:

1. Social Value: What practices does your business have in place to drive a positive social impact on the people and community it engages?
2. Labour Exploitation: How does your company prevent workforce exploitation, ranging from preventing Modern Slavery to withheld holiday pay, across your supply chain?
3. Equality, Diversity & Inclusion: How does your business work to attract talent from a hard-to-reach groups and ensures it retains diverse talent?
4. Procurement & Supply Chain Management: How does your business assess, monitor and develop your supply chain to ensure it is a sustainable business?
5. Health & Wellbeing: What is your business doing to better understand and support the needs of your workforce to create a healthier and happier working life?

How contractors can answer these questions

Contractors can prepare for these questions by implementing and documenting robust social sustainability practices. Examples of responses might include:

1. Social Value: Show a broad range of activities that drive Social Value but most importantly demonstrate proper governance for what you are doing. This includes training employees, measuring your impact, setting a strategy that enables your company to make the greatest impact, and continually monitoring and improving practices.
2. Labour Exploitation: Show that you understand different types of exploitation risk within your operation and that you understand the supply chain that is bringing people to work on your behalf (employees, temporary labour and workers via subcontractors). Once this is established, present how you are mitigating exploitation risk for workers coming via these routes. For example, are you assessing your subcontractors for employment and temporary labour practices? Most companies have controls for employees but very little for temporary workers.
3. Equality, Diversity & Inclusion: Show that your business is actively executing against your policy and that you are measuring what you are doing through diversity metrics. Can your business demonstrate an awareness that promoting equality, diversity, and inclusion positively impacts your overall success and that you are committed to ongoing development in these areas? This may be through identifying an aging workforce in certain areas and executing activities to encourage new young talent or ensuring that company initiatives cover a broad range of activities to try and cater for everyone.
4. Procurement and Supply Chain Management: Demonstrate that you have an invested interest to drive the same business values you adopt through your supply chain by understanding the practices they have in place and how you aim to help them develop. Demonstrate how your procurement and supply chain practices are encouraging businesses to operate more sustainably. This may be through scoring tenders on sustainability factors or including sustainability factors into performance reviews.
5. Health & Wellbeing: Showcase your business’s commitment to a healthy and happy workforce through initiatives and governance practices that enhance and manage wellbeing. This can include activities such as offering benefits, promoting mental health awareness and support, providing flexible hours, and implementing reward schemes. Regularly surveying your workforce and monitoring the impact of these activities exemplifies a strategic approach to health and wellbeing initiatives.

The benefits of independent verification

Independent verification of an organisation’s social sustainability practices, for example achieved by completing the new CHAS Social Sustainability assessment, offers numerous advantages for clients and contractors. The CHAS assessment objectively evaluates a contractor’s social sustainability efforts, ensuring both credibility and reliability.

Being a maturity assessment rather than simply a ‘pass / fail’ means that it enhances transparency and accountability by highlighting areas for improvement and benchmarking performance against industry standards.

The contractor receives a detailed report, which can then be used including in bids and tender responses to demonstrate the contractor’s commitment to social sustainability. That can lead to a competitive edge and stronger trust with clients, employees and other stakeholders.

Conclusion

The landscape of supply chain management is evolving to prioritise not just health and safety, but also social sustainability. By asking the right questions and embracing independent verification, companies can ensure their supply chains are not only efficient and safe but also ethically and socially responsible.

This holistic approach not only protects the company’s reputation but also enhances its long-term commercial success and contributes to a more sustainable and equitable world.