Creating Shared Value Blog

In a recent conversation with a leading company, I was asked whether companies, by creating shared value, no longer needed to engage in corporate philanthropy.  If companies are solving social problems through their business, why bother with philanthropy?

As a CSR professional, you are nervous. When your CEO asks about how your company is Creating Shared Value (CSV), what will you say? How are you navigating this sea change from traditional CSR approaches to CSV? How might your role change and how do you position yourself and your company as a leader and not a follower of this paradigm shift?

This blog post is part of the HBR Online Forum The CEO's Role in Fixing the System.

The key to reforming capitalism lies in creating shared value by harnessing the power of business to solve social problems. Paradoxically, in these difficult economic times, the business opportunities hidden in our urgent social problems offer the greatest potential for profit and growth most businesses will ever face. But there is a trick to discovering these opportunities: It takes a CEO who can see through walls to find them.

We have continued to explore the question of how companies can translate the idea of Creating Shared Value (CSV) into their corporate strategy and business processes. The question of how you do CSV is top of mind of executives and CSR professionals as came out clearly in our second webinar on the topic last Wednesday (28th September). FSG's Mark Kramer and Marc Pfitzer were joined by Paul Ellingstad, Health Director at Hewlett-Packard’s Office of Global Social Innovation, Jessica Hubbard, Senior CSR Manager from Houghton Mifflin Harcourt, and Paul Snyder, Vice President of Corporate Responsibility, InterContinental Hotels Group (IHG). The panel discussed pertinent questions from the audience about how to implement CSV, including how to create a culture of CSV within the organization and overcome resistance by certain business units and how to select and effectively engage external partners – be it NGOs or governments. However, and not surprisingly, most questions centered on the topic of measurement: What metrics do you use to measure shared value? What is the impact of CSV on shareholder value? How can you reconcile the short-termism of financial markets with the longer-term focus of any CSV strategy given the time it takes to bring about social change?