Creating Shared Value: It's the Future

This motion graphic video illuminates the potential of shared value. See how GE, IHG, and Nestlé are using the three levels of shared value successfully. Please share this video with your networks to lend a deeper understanding of the concept. Creating shared value “is not an option, it's the future." Watch below or on YouTube.

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Antonio Vives	(4/10/2012 1:16:43 PM)

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What's new?

You have been repeating what the CSR profession has been saying for decades, except that you prefer to missrepresent what CSR is in order to create a commercial niche for yourselves. The only new thing in your idea is a letter V, instead of R. CSV instead of CSR.

But your idea is more restrictive: Creating SHARED Value, when the corporation can create more value without the restriction that the value created is shared.

The compnay can create and share more value by SHARING CREATED VALUE, whenever it suits their strategy, with whomever suits their strategy and in the amounts it suits their strategy. Create economic AND/OR social value shared or 2B shared.

Read about in my paper on Creating Share Value vs. Sharing Created Value in the forthcoming number 10 (May 2012) of the Revista de Responsabilidad Social de la Empresa, Madrid.

Hope you can publish this comment even if not favorable to your idea. It would show your willingness to entertain alternative viewpoints

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FSG	(4/11/2012 8:02:42 PM)

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1 of 2-part response

Dear Antonio,
First, I should mention that all of our work in shared value is undertaken by FSG, a nonprofit organization. Our goal is not to create a commercial niche for ourselves, but to engage the power of corporations in solving social and environmental problems at scale.
Second, we believe that shared value complements but does not replace traditional approaches to CSR, which tend to focus on mitigating the harms in a company’s value chain. Shared value represents a fundamental shift in how managers think because it requires taking social and environmental dimensions into account in a company’s core strategy. We think it goes beyond conventional thinking about CSR, especially in shared value’s proactive emphasis on developing new products and markets that enable companies to help solve social problems that they neither create nor contribute to.

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FSG	(4/11/2012 8:03:08 PM)

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2 of 2-part repsonse

Instead of being restrictive, we see the approach as an important opportunity for companies to extend their competitive edge by promoting sound solutions to genuine social and environmental problems. And that isn’t just our view; the companies we talk with tell us that Shared Value is a new way of thinking that is very different from CSR.
I am not exactly sure what you mean by “sharing the value created” but to me that sounds like giving away some of the company’s profits, such as in corporate philanthropy. We see that as far less powerful in solving social problems than engaging the core capabilities and competitive drive of the company. In practice, we see that companies greatly increase their commitments when they recognize the business significance of a shared value initiative instead of thinking about giving charity.

Antonio Vives	(4/11/2012 8:26:00 PM)

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Thanks for your response. Unfortunately you entertain a vision of CSR of the last century. No, CSR is NOT about mitigating risks in the value chain. CSR is a much broader concept, it is taking responsibility for the impacts of company activities, which include doing well for society, as it is the best interest of the company to have a sustainable society in all senses of the word.

No, sharing value created is not philanthopy and it is not giving away company profits, as much as your idea of creating shared value means that the company does not appropriate ALL of the value created. Does CSV mean that the company is giving away value?

Value, social and economic, not profits, can be created to be shared according to the strategy of the company and society's needs.

You may want to read sustainability reports of the companies you cite, Nestle, GE, etc. among others from BEFORE you created CSV to see that their CSR was not only reactive.

P.S. Congratulations on the McKinsey prize

Katja Schiller	(4/19/2012 5:17:49 AM)

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Great video and comments.

I think that CSV is an articulate expression and approach to implementing corporate social responsibility.

Nadine Riopel	(4/20/2012 3:25:56 PM)

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Correct me if I'm wrong, but the debate in the comments looks a bit like a squabble over semantics. We all seem to be on the same page about making a company's core activities work for both social and business impacts. That is a great thing.

Who cares what we call it? Who cares who wrote what paper? Who cares if anyone's making any money in the process?

I'm all for debate, but let's please try to remember that we're basically all on the same team here, and take an approach that builds on each other's work, instead of pitting ideas against each other.

JB	(7/19/2012 2:13:07 AM)

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Nadine, I fully agree with you.

First, for a company to be more sustainable to their efforts, it is advised for them to maximize their core business capability, and with this, they could embed community/society.

Second, working close to its core business would mean promoting their CSR which is inclusive in their business.

Third, CSR alone, will have their budgets, and given a scenario, less budget less activity. for CSV since this is CLOSE and EMBEDED to the core business of the company, BUDGET is NO PROBLEM. this is a strategy that links companies to communities and make these communities sustainable, also gain more profit for the company. by then they CREATE SHARED VALUE.

Lastly, companies should Earn good, Feel Good, then DO Good. how could one share if they got nothing to share? bottomline is, company should earn good. let them sustain their good earnings and let them feel good. then they will share this and do good to all.

JanetFW	(11/20/2012 6:47:30 PM)

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Interesting video and commentary. Thank you for sharing. I'm a great proponent of (sustainable) shared value creation, and do believe, as many have said before, it's an emerging frontline for competitive advantage and a healthier future. It's a pragmatic, rather than altruistic view to creating shared value with no trade-offs, opening the door to extraordinary and potentially disruptive innovations. I don't believe it is a restatement of existing CSR practices (though some enlightened companies are already applying it under that nomenclature, or something similar), as it has the potential to be transformative for business and society, and is neither peripheral, incremental nor uneconomical. Of course there are leaders already well ahead, Interface et al, but too few. The case that shared value creation makes good business sense opens the door for many laggard companies to engage or accelerate their activities, and importantly to embed it at the core of their business models.