During this period Davidson was appointed a Companion of the Order of St Michael and St George and his temporary rank was confirmed as substantive on 29 May 1916 with precedence of 19 June 1915. Whilst personally rallying the battalion during the Battle of Guillemont in the Somme area in 1916 Davidson was once again wounded in action. The battalion's medical officer, Noel Chavasse, was also wounded during the battle whilst rescuing injured soldiers and in doing so won the unit's first Victoria Cross (VC). Chavasse would subsequently win their second and last VC at the Third Battle of Ypres in 1917. Davidson spent the remainder of the year convalescing and returned to the battalion in 1917. Later that year he left the unit and returned to Liverpool where he became that city's Chief Engineer.