Shared Value Project’s Founding Members Bendigo and Adelaide Bank and IAG have been recognised as two of 50 companies changing the world; in the third annual Fortune Change the World List released on Friday.
The Fortune Change the World list aims to showcase the power of capitalism to improve the human condition by identifying companies that have made an important social or environmental impact through their profit-making strategy and operations.
The list includes other international organisations that are doing well by doing good, with annual revenues of $1 billion or more, such as JPMorgan Chase, Apple and Nestle who made the list for the second time. Nestle Australia is also a founding member of SVP. Amcor, an Australian-owned packaging company, is also recognised in this year’s Change the World list.
Peter Yates AM, Chair of the Shared Value Project congratulated both Bendigo Bank and IAG for being on the list of global companies changing the world.
“Both Bendigo Bank and IAG are great examples of organisations that have used their business capabilities and resources to address a pressing social issue in a measurable and sustainable way and improved their profitability. Their recognition by Fortune as two of the 50 companies changing the world is a clear sign that Australian companies are achieving competitive advantage through the adoption of shared value,” said Peter Yates AM.
Ranking ahead of global companies such as IBM, Dell, Salesforce.com and American Express, Bendigo and Adelaide Bank and IAG have unique business models that use shared value to create profitable economic benefits with social outcomes.
For Bendigo and Adelaide Bank, it is their Community Bank® model, a community owned company that operates in partnership with the bank. Through this model, Bendigo Bank supports self-selecting communities to run their own branches as franchisees, leveraging the bank’s infrastructure and expertise. Besides providing financial services, the bank also reinvests a portion of their revenue into communities to drive long-term growth. To-date, more than $165 million in profits have been put back to local communities, generating local employment opportunities and ensuring future sustainability and prosperity.
Mike Hirst, Managing Director of Bendigo and Adelaide Bank said:
“Shared Value is a concept now gaining global momentum, although it has been central to our strategy for Bendigo and Adelaide Bank’s entire 160 year history.”
“To be recognised among international enterprises committed to strengthening the connection between corporate and community success by addressing social and environmental needs is confirmation that our business model is ahead of its time.”
“We are enormously proud of our Community Bank® model, which is the most obvious of our shared value models. The concept of feeding into community prosperity, rather than off it, is fundamental in all we do.”
“The model better enables local communities to develop the capability and resources that underpin their own sustainability, growth and resilience through providing funding and helping build commercial skills.”
“The performance of the financial system is ultimately only as good as the benefits it delivers to its users whether they be individuals, communities or businesses. We believe that to be truly successful, all stakeholders in our business – customers, staff, shareholders, partners and suppliers – must feel fairly rewarded for the effort they put in to helping our business be successful,” said Mike Hirst.
General insurer IAG which counts NRMA Insurance and CGU Insurance among its stable of brands, is an early adopter of shared value as a core part of its business strategy. Through its ‘Shared Value Framework’, IAG identified three key themes central to its purpose of making the world a safer place: safer, stronger, and more confident communities. IAG’s ‘Good Hoods’ program encourages individuals to take a first step of connection and interaction by listing existing neighborhood initiatives and encouraging the launch of new ones, ultimately aiming to build a more resilient nation. IAG was also recognised by Fortune for being the only insurer in Australasia with a Research Centre dedicated to research and testing with a focus on safety, security and repair costs.
IAG Managing Director and Chief Executive Officer Peter Harmer said:
“The recognition from Fortune reflects our strong focus on embedding shared value into our business and could not have been achieved without the support of our people, from the frontline to the boardroom.”
“Shared value provides a pathway for us to approach every aspect of our business with our communities, customers and people at front of mind, while still delivering the commercial value and strength our stakeholders expect from us.”
“We know that collaboration is critical in creating long term and impactful change. We are proud to be featured in the Fortune Change the World list alongside the Bendigo and Adelaide Bank who we have partnered with for more than 120 years.”
Last year, NAB ranked 22 and was the first Australian headquartered company to be named in the list. The nominations were based on three criteria for companies nominated; to have measurable social impact, to achieve business results in the way their socially impactful initiative bring economic benefits to the company and the degree of innovation these companies applied to their business.
The initial solicitation and assessment of nominees is conducted in partnership with FSG, a non-profit social-impact consulting firm, the Shared Value Initiative, a global platform for organisations seeking business solutions to social challenges, and Professor Michael E. Porter of Harvard Business School. The final list of 50 is evaluated and ranked by Fortune’s journalists and editors based on the magazine’s own reporting and analysis.