1. CREATION SHARE VALUE
SHAAHIN ,SHAHSAVARI

2. Growing Challenges
External pressures for corporate social responsibility continue to grow
Many companies are engaged in an unprecedented range of CSR activities
But the legitimacy of business continues to erode
Most companies treat CSR and community issues as separate from their core business agenda

3. Company practice in CSR leaves much room for improvement
Unfocused
Still a major PR component to choices
Reactive
Limited impact
And concern with social issues will be a defining characteristic of the post-crisis era

4. The Boundaries of Capitalism: Prevailing Thinking
Companies create benefits for society through performing their traditional market functions and maximizing profits
Revenues
Employment and wages
Purchases
Investments
Taxes
Companies should not be expected to take on extra social and community functions

5. Corporate activity and economic growth can have adverse societal impacts in areas such as the environment, health, safety, and community development
There are social tradeoffs and externalities in doing business that must be mitigated through regulation, taxation, and redistribution
The private sector is often seen as the problem

6. The connection between competitive advantage and social issues
There are numerous ways in which addressing societal concerns can yield productivity benefits to a firm. Consider, for example, what happens when a firm invests in wellness program. Society benefits because employees and their families become healthier, and the firm minimizes employee absence and lost productivity.
The graphic below depicts some areas where the connections are strongest.

8. Shared value
Can be defined as policies and operating practices that enhance the competitiveness of the company while simultaneously advancing the economic and social conditions in the communities in which it operates.
Shared value creation focuses on identifying and expanding the connection between societal and economic progress.

9. The Concept of Shared Value
The pursuit of value should animate improvement towards both economic and social objectives
Shared value arises from a deeper understanding of the drivers of competitiveness and competitive advantage
Achieving shared value requires new operating practices, new technologies, and new approaches to competing

10. CSV
CSR

11. Levels of Shared Value Reconceiving products and markets
Redefining productivity in the value chain
Enable local cluster development
A broader understanding of the economics of productivity and the external influences on the corporation

13. Creating Shared Value The Need for Collaboration
Collaboration within the private sector can be a more effective vehicle to improve external context than solo efforts, especially in areas more removed from a company’s own business operations
Cross-sector collaborations with NGOs, governments, educational organizations, professional bodies, and civil society can leverage their skills, expertise, relationships, and convening power to address social and community issues
_ A new brand of NGO has emerged that sees its role as facilitating the creation of shared value with corporations

14. Measuring Shared Value
Financial Value
Revenue
Productivity
Long-term sustainability of performance
But financial market pressures have deterred fundamental performance improvement opportunities
Societal Value
Job qualities
Improvement in employee health and skill level
Environment performance
Cluster vitality
Local economic performance
Human development metrics for the community
Examine the sum of financial and societal value

15. Adding a Social Dimension to Strategy
Customers and business partners value social performance, not just economic performance
Companies can have the greatest societal impact in areas tightly connected to their business
This is where societal performance and economic performance intersect most closely
Societal improvements create shared value for the competitiveness of the business

16. Companies should incorporate a social dimension to their value proposition
Shared value will reinforce the company’s unique strategic positioning
This social dimension of strategy can be more sustainable than conventional cost and quality advantages

17. Identifying Opportunities for Shared Value
Finding those Areas where Shareholder Interest and Society’s Interest Most Strongly Intersect
Potential Areas
Product attributes
Underpenetrated markets
Process / value chain choices
Locational decisions for facilities, purchasing, and hiring
Productivity constraints in external context

18. Organization
Centered in operating units in major locations
Units in developing countries or in underserved / affected areas are potential innovation sources

19. Many social deficits or community challenges can be turned into shared value opportunities by the appropriate company.
There are often substantial opportunities for shared value with disadvantaged citizens / communities and in developing countries in which the company does business.

24. The Purpose of Business
There is an opportunity to transform thinking and practice about the role of the corporation in society, around the concept of shared value.
Shared value arises from a deeper understanding of doing business that transcend narrower conceptions of economic efficiency that have guided operating practices in recent decades.
The shared value perspective will provide new catalysts for economic growth and the next wave of innovation and productivity in the global economy.

25. Businesses acting as businesses, not as charitable givers, are arguably the most powerful force for addressing many pressing issues facing our society.
This transformation in practice will give purpose to the corporation and to capitalism itself, and represents our best chance to legitimize business again.