Shared Value Still in its Infancy
26 August 2015 at 10:55 am
Shared value is yet to take off in Australia, but more companies aspire to incorporate it into their business strategy, a report of ASX 100 companies found.
In the first report of its kind, called The State of Shared Value in Australia, the Shared Value Project sought responses from 163 companies, targeted at the ASX 100 as well as organisations with significant experience in the field.
Forty-one companies completed the survey and, of that number, 46 per cent said they are currently pursuing a shared value strategy or had done so in the past.
Shared Value Project Executive Director, Helen Steel, said that while shared value is in its early stages, awareness is growing.
“Shared value is somewhat in its infancy, although others would argue as it is the evolution of CSR it’s been around for a long time, but I think most companies here are in the aspirational stage – aspiring to understand what shared value is and how it can benefit their organisation,” Steel said.
“Certainly we’re seeing a much broader understanding, or companies are talking more about shared value than before, and this is seen not only in the corporate sector but in the consulting sector as well, there’s a lot more conversation.
“What we’d like to see, conducting the survey again 12 months or two years from now, is lot more responses and identification with the language and a deeper understanding of what it actually is and what the benefits to the organisations are.”
In addition to economic and social return, 100 per cent of respondents agreed that a shared value strategy builds brand value for their organisation.
Stronger employee engagement is identified as another benefit, yet paradoxically the report also found “internal perceptions of what is meant by shared value and why it’s worth the effort” is a major challenge for organisations.
“For shared value to be taken seriously as a competitive business strategy, perceptions within the organisation need to be changed,” the report said.
“A step towards achieving this change comes from improved communication of the main messages throughout the entire organisation.”
However, the report also found that the terminology used by companies and how they define socially-focussed work is varied.
“Many companies who did not describe their strategy as shared value are in fact delivering strategies that create shared value – this raises the question of how important it is to have a shared vocabulary,” the report said.
A further inconsistency highlighted by the report is the lack of a clear pattern between a company’s core business and their shared value initiatives.
“It was interesting that there wasn’t any correlation necessarily between the sector that the company operated in and the types of social issues that they were trying to address,” Steel said.
“Financial services sector weren’t necessarily trying to help with financial literacy or education.
“Companies have a lot of specific knowledge and expertise in particular sectors, and you think it might make sense that a Stockland or Lend Lease is helping to try to solve the affordable housing issue.”
Despite the challenges, Steel expects significant short-term progress in the shared value field.
“Companies, once they get it, are certainly adopting it quite quickly,” she said.
“Companies are paying attention right now and I think Australia is an interesting market to conduct this sort of survey in.
“As a relatively small but very wealthy nation, once we decide to innovate and once we decide that there’s value in this type of activity, the take-up I think will happen very quickly.
“In the 18 months we’ve been formalised as an organisation we’ve seen a huge amount of interest grow over that period, and I think we would hopefully see equally or not more so over the next 12 months.”
Download the full report HERE