Creating Shared Value

Creating a shared value means to obtain a dual economic success both, for companies and for their related stakeholders. Shared value is a lifeblood aim for any modern company. This is mainly due to the fact that corporations are strictly dependent on their social referred group and can survive in the market only thanks to the agreement with stakeholders. Unfortunately, due to an unstoppable increase in capitalism, the commitment between companies and community has weakened. At the start, it was claimed that business contributed to society only with profits, employment, wages, purchasing, investment and taxes but in the last decades, thanks to the rising of social discrepancy, even if the profits of companies arise, their related communities are not receiving these profits[1].

How can we intervene to resume this relation?

We have to bolster the so called shared value concept and create a revolutionary framework in which profit and environmental friendly projects are not seen separately but embedded in the core company strategy. Implementing these new strategies means not only re-thinking about products and the market but also emphasizing the power of local companies and revolutionizing the value chain of companies [2].

Re-imagine products and markets implies thinking about sustainability in a new and unconventional way. It leads to include sustainability in undiscovered fields, such as financial investment. For instance, Azimut is a bank who has been able to attract new customers due to its focus on sustainability. Indeed, Azimut decided to change its criteria used to choose companies to invest in.  It added to other criteria, such as credit solving, profitability, return on investment, projects undertaken, the Eco sustainability. This meant new companies had to follow sustainable and ethics rules to be included in Azimut’s pool. Imagine if Azimut’s competitor behaved in the same way, this could probably lead to a breakthrough transition from business as usual to a true sustainable business. A transition into a new world in which companies have to conduct business in a sustainable or ethical way because if not, they would not be able to receive funds from investors. Therefore, the bank leader “Azimut” not only reinvented a product but created a new market, being able to prove that environmentally friendly challenges are not only a cost for business but a creator of revenue.

Another well-known strategy is to emphasize the power of local and cluster companies. By doing this, each company is able to foster firm efficiency while improving its surrounding. As United Nations Industrial Development Organization, (UNIDO),  is doing with small and underdeveloped firms. It is trying to let them realize economies of scale, transaction costs and coordination costs to gain competitiveness in a more global view.

Even Walmart is struggling. It is using its well-known purchasing power to force suppliers to improve and to become more conscious about sustainability issues.

Thus, as we seen above, companies recently started to undertake measures to regain the community-business commitment but, still, progresses need to be made.

[1] Carroll, 2015, Corporate social responsibility: The centerpiece of competing and complementary frameworks, Organizational Dynamics, Volume 44, Issue 2, Pages 87-96, [Online], Available:

[2] Creating Shared Value, 2011 How to reinvent capitalism-and unleash a wave of innovation and growth, Porter and Kramer


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s