Australian companies pursuing shared value strategies, or strategies with similar principles, are seeing both social and economic benefits as well as positive brand associations, according to findings from a report by Shared Value Project and Social Ventures Australia.
Gillian Turnbull, from Social Ventures, said the main purpose of The State of Shared Value in Australia 2015 was to understand the current state of shared value activities across leading companies in Australia. The survey targeted senior management (chief executive officers, and executives of corporate affairs, strategy and corporate responsibility) of S&P/ASX 100 companies.
The key benefits of a shared value approach include improved brand value, particularly among consumers and employees; as well as creating a competitive advantage for a company by encouraging more innovative solutions to traditional business challenges, or opening up access to new markets.
To be able to optimise advantages from creating shared value, said Turnbull, companies must ensure the shared value approach is fully embedded in their overall business strategy. There also needs to be clear measures in place to measure the outcomes and impact of the strategy, as well as a clear communication plan to share the approach and impact both internally and externally.
“If the board of a company wants to leverage the advantages of shared value, there is a clear role for them to play in setting the mission and vision for the company and driving the strategic direction to incorporate shared value creation at all levels of their business.”
Turnbull added that this then needs be communicated effectively within the organisation to ensure everyone is moving in the same direction. “The board also need to be clear about the targets they are expecting to achieve and to hold people accountable for reporting against these targets. Also, the board needs to establish a clear communication plan for sharing the results of any shared value strategy that achieves results.”
Commenting on the increased focus of shared value as a business strategy tool, Mark Kramer, author of Creating Shared Value, said the concept is one that has evolved from the traditional concept of corporate social responsibility. He said that a business using the shared value idea could make money by solving social problems and become a tremendous player in social progress.
“Companies have always engaged with society in terms of philanthropy. In the last few decades, they’ve been conscious of their sustainability and their corporate social responsibility,’ says Kramer. “Corporate social responsibility has to do with minimising the harms that a company causes in its operations. Shared value is different. Shared value is the role a company can proactively play in going out and solving social problems that either constrains the company’s growth, or gives it new product and market opportunities”
For more information, see The State of Shared Value in Australia 2015 Report.
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