Kate Hardiman from the Australian Centre for Corporate Responsibility (ACCSR) reflects on last months ‘Unlocking Shared Value Workshop’, and how shared value is simply smart business because we can’t continue to grow the economy without factoring social justice and environmental considerations in to strategic planning.
Sustainability can be a term that still carries ‘baggage’ and CSR is often still confused with corporate social investment or even philanthropy. So is shared value just another buzz word or passing trend in the space?
No, according to shared value expert Jonathon Hanks, speaking during his recent visit to Australia to deliver ACCSR’s ‘Unlocking Shared Value’ workshop in Sydney. The rise of populism is leading to increasing frustration with how business is being done around the globe. Hanks believes that, increasingly, societal challenges will impact on an organisation’s ability to deliver value because we’re hardwired to only account for economic capital. “Shared value is simply smart business because we can’t continue to grow the economy without factoring social justice and environmental considerations in to our strategic planning.”
Hanks sees the International Integrated Reporting Council’s (IIRC) framework being valuable in this regard as it prompts companies to reflect on their relationship to all forms of capital. Senior management are increasingly required to speak in the language of business about capital. Our capacity to generate value in the future will require us to interrogate how we impact on the various forms of other capital, specifically social, natural, human and intellectual.
Practically and for those working in the sustainability and CSR space, encouraging business to test shared value initiatives in their business Foundation or other not-for-profit entities could be a way to prove the concept whilst keeping the risks quarantined. Also, try to engage the Strategy people in shared value discussions and activities because, like it or not, they often carry more weight than the Sustainability team when it comes to commanding the attention of those higher up the chain. Another tip from Hanks is to benchmark and measure project progress and outcomes from the outset so you can accurately track and report on the ROI of the activities. There will often be internal pockets of resistance found when walking the shared value path however these can be overcome using small, team based workshops and team coaching to better understand the team thinking and to define the appropriate process.
“Shared value is a mechanism by which we can reframe sustainability in the business narrative” says Hanks. It is a compelling business strategy that both addresses societal challenge and delivers clear financial benefit by improving the profit formula and by building tangible new markets. The most sustainable companies interrogate the way value is created and shared amongst its stakeholders in the short, medium and long term. On this basis it would seem that shared value is far from a trend but rather a robust method for driving sustainable business value whilst driving social value for any organization.
This article was originally published by ACCSR