Shared Value: The experts weigh in
Shared value is fast becoming a key focus for businesses. This was none the more evident than at the recent 2015 Shared Value Forum. Held in Melbourne and presented by the Shared Value Project, it brought together more than 130 national and international major players from across the corporate, consulting and community sectors.
Mark Kramer is the co-founder and managing director of FSG, a non-profit consulting firm that specialises in strategy, evaluation, and research, and author, who co-wrote the defining article ‘Creating Shared Value’ with Michael E Porter for the Harvard Business Review.
Your keynote address explored how shared value is advancing as a global movement. What changes have you seen over recent years and why do you think it shared value is essential to both business and society?
We have seen a number of major companies expand their focus from minimising harm in their operations and supply chain to add a new focus on how they can proactively address societal problems as business opportunities. This is a tremendously important shift as it dramatically increases the scale of resources available to address society’s challenges. It also unleashes the expertise and capacity for innovation that companies can bring to meeting social needs. When a profitable business model can be identified to meet social needs, it can be scaled up and sustained without having to depend on the much more limited philanthropic funding available.
You also lead a workshop that examined the complexities involved in measuring outcomes that link businesses and social results. Why is measuring value so important?
You can’t manage if you can’t measure. Companies need to understand the link between their social impact and their business outcomes and measure both dimensions so that they can optimise their performance in both ways. When the social impact isn’t measured, it usually isn’t achieving its full potential.
A tweet shared during one of your talks noted you said: A champion is key to driving shared value within companies. Why so? And how can staff help champion shared value within their own companies?
Driving change within any organisation is always difficult, and it takes someone who cares passionately about the change to make it happen. It’s great when the champion is the CEO, but champions emerge at all levels throughout an organisation, and they can familiarise people with the concept of shared value, highlight examples from other companies, and identify opportunities for their own companies to launch new shared value initiatives within their area of responsibility.
Anything else you would like to add?
I am immensely encouraged by the enthusiasm for shared value I see on the part of many leading Australian companies, and by the progress that the Shared Value Project in Australia has made over just the last year. The idea is really catching on, and Australia is at the forefront of the global shared value movement.
Sarah Cobourn is the senior officer of CSR and corporate affairs at Hitachi Australia. She is also a former industry consultant and lectures at the Faculty of Business at the University of Technology Sydney.
You recently completed a PhD on creating shared value. Can you tell us a little about it and what it explored?
The PhD was actually an international investigation focused on shared value within the sport industry! The purpose was to identify opportunities for shared value in professional sport, specifically examining the current ways in which best practice professional sport organisations innovatively design and employ strategies and initiatives to strategically integrate social, environmental and financial performance. To achieve this, an in-depth exploratory case study was undertaken with 12 professional sport organisations from major North American, European, and Australian sport leagues.
You’re the senior officer of CSR and corporate affairs at Hitachi Australia. A tweet shared during the forum quoted you as saying: You can empower people internally through innovation. Can you tell us a little about this and how Hitachi practices it?
At Hitachi, we’re very focused on our Social Innovation Business, which is anchored by the desire to identify issues from customers’ and society’s perspectives and work on solutions specific challenges through our products and services. With our mission to contribute to society through the development of superior, original technology and products, we can empower our employees through innovation. Whether it be in sales, operations, HR or in senior management, each employee plays an important part in delivering innovation that answers society’s challenges. When employees feel connected to this, they feel empowered by their jobs and the potential of Hitachi’s Social Innovation Business.
You were part of a Shared Value Forum panel discussion that addressed the questions: What next for shared value? What are the challenges facing the movement’s global adoption? Can you tell us a little about your thoughts on this and what you thought were some key take-outs from the discussion?
- One of the things that was heavily discussed at the Shared Value Forum was the role of government in the shared value movement. Whilst there is no clear answer, it will be important for government to adapt and align with this type of thinking.
- Communication of these initiatives and programs within Australia must increase in order to make generate more attention and activity in this area.
- In reality, a lot of shared value comes from recognising the societal needs in a purely economic activity. The other side is re-shifting an existing CSR program or initiative to leverage greater economic impact.
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