Creating Shared Value (CSV) as a New Business Way

Creating shared value is a relatively new concept and it’s not the same as corporate social responsibility – although the two are often confused. The big difference is that CSV is all about maximizing profit and still putting business opportunities and growth at the front and center of the picture, whereas corporate responsibility is about looking at the business impact on the local community and environment.

How to Create Shared Value
According to the original article by Porter and Kramer, there are 3 ways that businesses can create shared value. These are as follows:

  • Reconceiving products and markets – developing profitable products and services that meet the needs of the company’s customer base whilst fulfilling social issues and improving local communities or reducing environmental impact.
  • Redefining productivity in the value chain – identifying and successfully addressing social and environmental problems associated with your industry whilst increasing the productivity of your company and boosting the revenues and operational capacity of your suppliers.
  • Knowledge sharing and support – helping local competitors in your sector created shared value by discussing how different management strategies have benefitted your company and the community.

CSV Benefit
The benefits of creating shared value to the wider community and environment are obvious, but what are some of the secondary benefits, other than an increase in profitability, for companies?

  • Your business becomes your marketing – people understand immediately how your services or products benefit the community. It becomes obvious to your audience how your company can help them resolve issues on the local stage.
  • Goes beyond gestures – often the actions created by corporate social responsibility policies were considered to be publicity stunts for attention. Creating shared value goes a level deeper, actually linking the delivery of services and products with clearly defined benefits. This is ongoing PR rather than relying on big-moment messaging.
  • Not just donation – rather than simply adopting processes and practices that may be contrary to good living and then redistributing the profits to charities, businesses are spearheading changes in their local community. And when people see the change on their doorstep, they are likely to become passionate advocates.



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