Shared value is a concept that has gained recent attention in business networks. This concept refers to the development of business practices that produce both benefits for corporations as well as for society. The purpose of shared value is to strengthen society so that it can continue to support business activities. While there are obvious benefits for investing in the development of shared value, many businesses today are still reluctant to focus company time and resources on it.
Reluctance to Develop Shared Value
The reluctance of companies to develop shared value is based on the traditional segregation of business from social responsibilities. The traditional viewpoint is that businesses were not developed to improve society, but rather to produce a profit. This means that they have no responsibilities to society or to help others, they only have a responsibility to meet the needs and demands of their stakeholders.
Turning the Tide
The problem with the traditional viewpoint that businesses have no responsibilities to society is that they are discounting the fact that society, to a large degree, is a stakeholder in their business. For example, people in society are consumers who buy products and services from companies and they are also the individuals that develop trade laws and regulations. If companies continue to ignore the needs of this stakeholder then they can expect problems over the long run in regards to their sustainability.
Developing Shared Value
The benefits of developing shared value include operating in an environment that is supportive and nurturing of company growth and development, as well as having access to public opinion leniency during times of corporate crisis. In order to develop shared value an organization needs to focus on finding ways to evolve corporate culture so that the company automatically produces social benefits without expending extra energy or money.
The automated process of producing shared value sounds more difficult and complex than it actually is.
Companies can produce shared value simply by making small changes to the way that they operate and conduct business. These changes will not only help to improve society, but it will also help to improve the operation of the company as well. For example, companies can develop shared value by implementing environmentally friendly manufacturing processes such as using organic dies, recycled materials or renewable energy sources to power their manufacturing plants.
The key to developing shared value strategies is to find what society and the company can both benefit from and to then focus on these things.