CORRALITOS, California — The Shared Value Initiative gives an assignment to companies to be socially responsible, but in a way that creates meaningful and impactful business. Creating shared value requires work on three levels: reconceiving products and markets, redefining productivity in one’s value chain and cluster development. Each of these levels of operation have been successfully achieved by several corporations.
Reconceiving products and markets is helpful because it defines certain markets in terms of the unmet needs or social issues and creating a profitable product or service that would help these situations. Redefining productivity in the value chain entails that the company address the social and environmental drawbacks that it has in its own network. This in turn will help increase productivity of the company.
The last level the idea of creating shared value operates on is the local cluster development. Through this stage, it is the main objective to strengthen the competitiveness of the company in areas around the world where the company operates to increase the company’s growth and productivity.
One company in particular, General Electric, came up with a shared value program called “Healthymaginition.” Through this program, GE offers high quality medical care for low costs for mothers in developing countries. Intercontinental Hotels Group has also done its part by creating “Green Engage,” an online tool that helps monitor energy consumption. Lastly, Nestle has given farmers in developing economies financial and technical help to create a better network for all in developing countries to obtain a stable income source.
“Creating Shared Value, these few words, is actually covering the fundamental way we want to behave as a company and by nature also as persons,” explains Paul Bulcke, the CEO of Nestle.
These three companies came up with a shared value program that focuses on building and maintaining economic and social value while also keeping the company competitive in the market. The Shared Value takes a new approach in defining roles for business in society that challenges traditional, older models of social responsibility for corporations.
According to the Shared Value Initiative, “shared value measurement provides a roadmap for reaching the promise of shared value, which is a global imperative at a time when innovating to achieve sustainable, scalable solutions to the world’s toughest problems requires the best business has to offer.”