My personal ideas behind the Shared Value Principle.

Since the last decade, and under the concept of Corporate Social Responsibility (CSR), myriad companies have been working very hard to be in compliance with the new laws and ethical standards. The actions imposed by governments are still considered by firms as a legal responsibility to prevent damage to environment. Notwithstanding, they also think that it is an effective means of improving their reputation vis-à-vis the communities in which they work.
Usually accepted a necessary expense, I am of the opinion that the CSR old-fashioned perspective is little by little in the process of being replaced by a new one… The Creation of Shared Value (CSV).
Still in its genesis, Shared Value tries to make business and society work in complete harmony. Although it follows the same CSR’s rationalization of doing well by doing good, it differs in the sense that CSV creates both societal and economic value by simply addressing population’s needs.
The purpose of creating value is to find a connection with current and prospective costumers. Through the social interest, firms are able to help communities while still making profit out of the situation. By concentrating on customers’ needs, companies are complementing missions and ensuring future without forgetting that these are the needs that at present define the market.
I then define Shared value as a set of good practices that a company must exploit to get the best competitive advantage out of the community where the business is. Likewise these activities could be materialized through the simple use of contemporary operating methods, approaches, or technologies, and without compromising firm’s solvency to operate at the most cost-effective level.
Because of the scarcity of resources, I am inclined to believe that the collective awareness of people is forcing companies to connect their successes with social progress. By creating economic channels both parties are being beneficiated, which is definitely changing the relationship that firms have with society, as well as making them grow healthier and bigger.
From my point of view, Shared Value can be created in different ways within companies. With a strong focus on consumers’s needs, a firm could become more productive and consequently expand its market. For instance, by reconsidering existing products or developing new ones, redefining the value and supply chain, recognizing and exploiting overlooked markets, building supportive groups at the local level, among others. The idea behind this work is to first identify societal needs and then the benefits that come with them. It is also important to spot any potential harm since this could affect not only the achievement of production, but also the economic success of the firm.
By giving future managers the necessary education to better understand social and environmental issues that perturb communities, firms will manage to jump from the Corporate Social Responsibility exigence to the Creation of the Shared Value perspective. Also this will develop people’s creativity to innovate, that will surely help institutions grow effectively, but above all it will create greater benefits for our society.