Michelle Veasey, NHBSR Executive Director
Creating Shared Value (CSV) seems like a very idealistic approach at first glance. Is it realistic to think that a business can realize growth and opportunity while addressing societal needs? There are several companies who think so.
Let’s take a step back – what does it mean to Create Shared Value anyway? The term is commonly attributed to Michael Porter and Mark Kramer, authors of "Creating Shared Value: Redefining Capitalism and the Role of the Corporation in Society"1. CSV recognizes the interdependence of a business’ sustainability with the health of its community and society at large. In its purest sense, CSV builds innovative approaches to not only create profit and opportunity for a company, and in the process, address societal needs.
Porter and Kramer identify three ways that companies can innovate and create shared value: reimagine your market and product offerings, redefine productivity in your value chain, and/or “enable local cluster development” (e.g. supporting programs that meet the educational requirements of your business, affordable housing for your employees, supporting suppliers that pay their employees a fair wage, etc.) A link to their article can be found below.
Triple Pundit recently published a great example of CSV in an article about the “Give Back Box”, a program created by the founder of StyleUpGirl.com, Monika Wiela. She passed a homeless man on her way to work in Chicago holding a sign requesting a pair of shoes. She was frustrated that she could only provide women’s shoes from her warehouse. Wiela continued to search for ideas and was struck with the opportunity empty shipping boxes provided.
What if customers could ship back boxes filled with charitable donations? Give Back Box was born. Now she, Overstock.com and Newegg.com include shipping labels addressed to secondhand charitable organizations in their product shipments. (Anyone can ship donations in any retailer’s box by printing a shipping label at GiveBackBox.com.) With over 30 million tons of cardboard used every year, Give Back Box creates shared value, providing a great opportunity for reuse and addressing declining charitable donations of clothing and household items.
NHBSR’s Just One Thing stories have uncovered examples in New Hampshire too!
Tom Strickland wanted to find a way to help nonprofits in his community, but with a small company, he had to find a way to do it without undermining the productivity of his limited staff. Sequoya Technologies Group created Sequoya Seeds, a program allowing paying customers to select a nonprofit in the Monadnock region to receive technical services equal to 5 percent of the customer’s bill. The impact has been significant, for several Monadnock area nonprofits and Sequoya. The nonprofits have been able to increase their technological capabilities and/or reduce operating expenses. The program automatically sizes itself to the revenue stream, never outpacing capability and has resulted in new business for Sequoya.
Monadnock Paper Mill used to send 95%, or over 1,200 tons per year, of its short-paper fiber (a by-product of manufacturing) to the landfill. Several years ago, through product substitution, MPM was able to change this by-product into a nutrient rich, safe material which is perfect for use as compost, soil amendment and animal bedding. In 2006, a local farm lost all of its farmland to flooding and the cost of replacing the soil was prohibitive. MPM’ s short-paper fiber met a local need and sheep are once again grazing on lush farmland. Now, 100% of this by-product is reused to enhance farming throughout the state and MPM has reduced its landfill costs.
These are great examples of rethinking business processes to create shared value. A need in the community is met with a creative business solution.
Where could you leverage your business to create shared value? Share your ideas below, submit your stories to our Just One Thing campaign or read the Just One Thing storyboard!
1 Creating Shared Value: Redefining Capitalism and the Role of the Corporation in Society by Michael Porter and Mark Kramer can be downloaded for free from the Shared Value Initiative.