Shared Value Concept Emerging In Australia

The co-author of the “Creation of Shared Value” business concept Mark Kramer has told a Melbourne forum that he is deeply impressed with the extent to which Australian companies are embracing social impact and sustainability.

Kramer, a Senior Fellow at the US Harvard Kennedy School of Government, describes Creating Shared Value (CSV) as ‘policies and operating practices that enhance the competitiveness of a company while simultaneously advancing the economic and social conditions of the communities in which it operates’.

Kramer is the guest speaker at the Creation of Shared Value Forum in Melbourne.

Kramer told the Forum he was impressed with the work already being done on corporate strategies that provide customer benefit along with the number of consultancies working in this area promoting the shared value model.

He said that the challenge for companies is “to think about what social value means to me and what I can do to magnify the social value we create”.

He says there are three ways for business to engage with society – via traditional corporate philanthropy, continued corporate responsibility and by creating shared value where businesses find opportunities to solve social problems.

He said in this society, governments and Not for Profits can no longer do this work alone. “Corporates have a unique opportunity to scale up programs that Governments and NGOs can’t do.”

Kramer told the forum that ‘shared value’ thinking represents “the next evolution of capitalism itself”. Controversially the model says not all profit is equal.

He said profit that benefits society is a better profit for business.

“Shared value is the most significant change in thinking and will drive profit for the next decade,” he said.

“Shared value adds ‘a third lens’ by thinking about social needs and business opportunities.”

Held in partnership with National Australia Bank, Net Balance and the 3 Pillars Network, the one-day forum brings together world leading experts with senior Australian business executives and community leaders to discuss strategies for managing and implementing shared value principles.

In 2011, the Harvard Business Review published the article, The Big Idea: Creation of Shared Value by Mark Kramer and Michael Porter.

“Businesses must reconnect company success with social progress. Shared value is not social responsibility, philanthropy, or even sustainability, but a new way to achieve economic success,” Kramer said.

“A growing number of companies known for their hard-nosed approach to business – such as GE, Google, IBM, Intel, Johnson & Johnson, Nestlé, Unilever, and Wal-Mart – have already embarked on important efforts to create shared value by reconceiving the intersection between society and corporate performance.

“Yet the recognition of the transformative power of shared value is still in its genesis. Realizing it will require leaders and managers to develop new skills and knowledge – such as a far deeper appreciation of societal needs, a greater understanding of the true bases of company productivity, and the ability to collaborate across profit/ nonprofit boundaries.”

Kramer said in Australia, early adopters to CSV include Nestle, National Australia Bank, IBM and IAG.

Pro Bono Australia is a media partner of the Forum.

Follow this conference on Twitter with the hashtag #CSVOZ