The Value of Creating Shared Value
Capitalism is suffering from a crisis of trust. Today’s businesses take the blame for many of society’s economic, social and environmental woes, despite the launch of countless corporate social responsibility initiatives in recent decades. Now more than ever—in the midst of a global economic crisis that has strained the capacity of governments and NGOs to address complex societal challenges—it is time to restore public trust through a redefined vision of capitalism with the full potential to meet social needs.
The Solution: Creating Shared Value
The next transformation of business thinking lies in the principle of shared value: creating economic value in a way that also creates value for society by addressing its needs and challenges.
What is shared value?
Corporate policies and practices that enhance the competitive advantage and profitability of the company while simultaneously advancing social and economic conditions in the communities in which it sells and operates.
Shared value is not corporate social responsibility, philanthropy, or even sustainability, but a new way to achieve economic success.
Michael E. Porter and Mark Kramer, “Creating Shared Value,” Harvard Business Review
Shared value is a management strategy in which companies find business opportunities in social problems. While philanthropy and CSR focus efforts focus on “giving back” or minimizing the harm business has on society, shared value focuses company leaders on maximizing the competitive value of solving social problems in new customers and markets, cost savings, talent retention, and more.
More companies are now building and rebuilding business models around social good, which sets them apart from the competition and augments their success. With the help of NGOs, governments, and other stakeholders, business has the power of scale to create real change on monumental social problems.
Highlighting the Shared Value Project and Social Impact Awards
The Shared Value Project is the peak practice body for shared value in Australasia, and the exclusive regional partner of the Shared Value Initiative. They drive adoption and implementation of shared value strategies among leading companies, civil society and government organizations by providing thought leadership, knowledge and networks.
Through their program of workshops, training and events that encourage individuals, organizations and change agents to view the creation of social value as a major competitive advantage, a driver of innovation, and foundation for long-term economic prosperity.
The Shared Value Project's 2018 Shared Value Awards, announced in Melbourne, recognized organizations from tourism and fast-moving-consumer-goods to insurance, finance, and consulting, for effective application of shared value to address social problems that intersect with their business to create scalable, profitable solutions.
List of award recipients can be found here.
Creator of the Gieseke Governance Style Preference Assessment (GGSPA)
1 年Michael Porter To support shared value at the landscape scale, I have designed a "shared governance" unit called a Natural Capital Unit. The NCU functions as a natural capital accounting unit, a shared governance unit, a currency unit, and a market administration unit. I approach the landscape issue, not from an ESG perspective, but from a GSE perspective because it is governance that guides the S & E. I am in the early steps of working with funders to develop this "EcoCommerce Crypto-Economic System" that is based on the NCU as the irreducible unit of value. Please connect if you are interested in its shared value attributes. Thanks, for your work, Tim Gieseke
Advogado
3 年Great vision about business and the future of capitalism. We need to think about others ways of how the capitalism works . Go to beyond profits!
China I Wellness I Marketing I Branding
6 年Heard Robert S. Kaplan speak on this subject in Shanghai and was very disappointed. It demonstrates that we have much to fear from Harvard Business School and its grads. The values system taught at institutions like Harvard are precisely the reasons for much of our problems. Professor Porter it is the kind of management and economic principles advocated by you and your colleagues which makes creating shared values more difficult.