Social capital: valuing relationships in a post-Covid world

Football clubs traditionally sit at the heart of their local community, providing entertainment and employment in exchange for income and the unswerving devotion of their fans. Currently playing to largely empty stands, some clubs are putting their expensive infrastructure to good use.

“A new coronavirus mass vaccination centre at Colchester United’s stadium will prove ‘vital’ in the region’s fight against coronavirus”¹

In this article we will explore further how developing the relationship between an organisation and the broader social environment within which it operates adds value to both. Similar to a symbiotic relationship in nature, the value derived in a business setting is a result of both parties to the relationship depending upon and contributing to the success of the other.

How might the value of social capital be expressed?

Social capital is not generally ascribed a market value; therefore it is doubly important that the benefits are recognised, thus avoiding the potentially costly consequence of under-investment in these ‘assets’. Impacts and dependencies are evident in areas including:

1. Working conditions, together with employee health and wellbeing: time spent away from work either through employment-related health issues or accidents harms the individual and their family, the organisation, and the wider community. Aside from the potential loss of income incurred when caring for a sick relative and productivity in the workplace, an increased use of local healthcare facilities is potentially at a cost to the rest of the community. By far the better option is for the organisation to invest in creating a great place to work.
   
   
2. Job creation and skills development: we touched on this briefly in the previous article. When an organisation achieves economic success and growth through a balance of investments between infrastructure and people, one consequence could be an increase in job opportunities. On top of the immediate benefit that brings to the local economy, the organisation may be better placed to positively influence other developments that bring benefit to the wider community, such as decent broadband!
   
   
3. Community-based activity and charitable work: many organisations now have policies aimed at supporting their employees who wish either to volunteer in the charitable sector or to take part in local community-based activities such as being a STEM ambassador in their local school. Whilst the economic benefit to the organisation may be less obvious in the short term, ‘outreach’ activities certainly deliver benefits in the longer term. Together with points made in our previous article on human capital about the benefits of engaged employees, being recognised for working with the local community and charities all support an ambition to be considered an employer of choice.

Why should organisations be more conscious of their social capital?

As the demand for more ethical and sustainable business practice grows, increasingly supported by toughening legislation, every organisation must focus more attention and resource on their environmental, social, and governance (ESG) responsibilities and their broader stakeholder interests. Understanding and adding to the value of their social capital, together with the human and natural capitals discussed previously are part of this responsibility. Organisations that can demonstrate commitment to developing their non-financial capitals enhance their social license to operate and are more likely to be trusted. A recent survey² also suggests that organisations which understand the relative importance of their other stakeholder interests compared to those of their shareholders are more likely to succeed in the long term. Increasing profits can be achieved in harmony with wider community interests. Let’s hope that when Colchester United are able to welcome their fans back to the ‘Jobserve Community Stadium’, their contribution to combatting Covid-19 is rewarded by increasing footfall at the turnstiles.

REFERENCES

1. Sullivan, O., New football stadium vaccination centre ‘vital’ in fight against Covid-19, East Anglian Daily Times [Accessed 19/02/2021]
2. Edelman Trust Barometer 2020