Shared value is experiencing wide-spread adoption, with global amplifiers and multiple actors embracing the shared value terminology across business-in-society convenings and platforms. This year at the 2015 World Economic Forum in Davos it was more apparent than ever, with economic growth and social inclusion highlighted across the open forum program of the Annual Meeting.
One session in particular questioned ‘Should Business Lead the Social Agenda?’, highlighting how the shared value concept is a powerful way forward in which business can work with society and be a part of the new social agenda, solving social problems and making a profit.
“Shared value is going back to the fundamental role of economical activity”, stated Paul Bulcke, CEO of Nestlé. “Which is, in society, economical activity should create value for all stakeholders, [only] one of them is shareholders, and when a company like Nestlé goes about its program and activity in a longer-term perspective, with something that is fundamental which is respect, whatever it does it will also create value for society at large.”
Mr Bulcke joined a panel of high profile, cross-sector leaders, moderated by Zia Khan, Vice-President of Initiatives and Strategy at the Rockefeller Foundation: Dhananjayan Sriskandarajah, Secretary-General of Civicus: World Alliance for Citizen Participation; Ashifi Gogo, CEO of Sproxil; Feike Sijbesma, CEO and Chairman of Royal DSM; and Helen Clark, Administrator of the United Nations Development Programme (UNDP). Watch the video below.
The panel focused on how businesses play an increasingly important role in the global social agenda. In the past, complex problems have often been left for international organisations and governments to solve, however many challenges such as the United Nations’ Millennium Development Goals (MDGs) have failed to be met, with governments and civil society often exacerbating societal problems by attempting to address social weaknesses at the expense of business, with presumed and institutionalised trade-offs between economic efficiency and social progress. (Porter & Kramer, HBR, 2011)
As we approach the adoption of the United Nations’ Sustainable Development Goals (SDGs) in September 2015, will shared value be the movement that helps to ignite the success and achievement of these goals?
The SDGs build on the foundation laid by the MDGs, seeking to complete the unfinished business of the MDGs, and respond to new challenges. The goals and targets integrate economic, social and environmental aspects and recognise their interlinkages in achieving sustainable development in all its dimensions. The implementation of the SDGs will depend on a global partnership for sustainable development with the active engagement of governments, as well as civil society, the private sector, and the United Nations system. (United Nations, 2014)
The SDG’s address a wide range of issues on the global social agenda including poverty eradication, hunger and food security, healthy lives and wellbeing, inclusive and equitable education, gender equality, water security, sustainable and modern energy access, unemployment, building resilience, sustainable consumption and production, climate change, conservation and biodiversity, and peaceful and inclusive societies. It is undeniable that business and the private sector play a key part amongst all of these issues.
There has already been successful examples and attention paid by business into addressing some of these issues such as building resilience, healthy lives and wellbeing, education, hunger and food security, as well as many other examples, however there is still a long way to go.
Kate Tallant, Director at FSG recently described how “companies are increasingly exploring new opportunities to simultaneously create shared value – often involving investments in their enabling environment that intersect with the SDGs in areas such as health systems, education and workforce development, agricultural supply chain/cluster development, enterprise development/local procurement, and infrastructure.” As Ms Clark stated within the Davos session, “business is part of society, you can’t move towards and achieve sustainable development without business playing its part.”
Business can’t reach it’s full potential in a society hindered by problems, big or small. The benefit of the SDG’s is that they outline a clear, cohesive list of global issues, in which businesses can identify what intersects with and affects their operations and economic prosperity, and what issues could also provide new business opportunities through being addressed – the fundamentals of shared value that bring business and society back together for all-round prosperity to unleash a new wave of global growth. (Porter & Kramer)
“Shared value offers corporations the opportunity to utilise their skills, resources, and management capability to lead social progress in ways that even the best-intentioned governmental and social sector organisations can rarely match.” (Porter & Kramer) Think of the potential if shared value continues to progress from early adoption to all businesses engaging in share value worldwide. Business would be investing in prosperity and operating at it’s best through creating more prosperous business and social conditions, and generating economic activity through addressing these goals.
The crucial part for businesses to play in leading the global social agenda and helping to achieve the SDG’s is through shared value.
What are your thoughts: Should business lead, or be part of the social agenda? Can the private sector help accelerate the achievement of the Sustainable Development Goals through creating shared value?
This article was originally published by the Shared Value Project. The Shared Value Project is a regional community of practice committed to driving adoption and implementation of shared value strategies among leaders and companies, civil society, and government organisations in Australia, and a Regional Partner of the Shared Value Initiative.