Companies could bring business and society back together if they redefined their purpose as creating shared valuegenerating economic value in a way that also produces value for society by. Pdf understanding creating shared value researchgate. Heblich 2007 and creating shared value camilleri 2017, porter and kramer 2011, 2014, european union 2011, elkington 2012, crane et al. For this scope these scholars have proposed the concept of creating shared value csv, which is an innovative approach that treats social issues as a source of economic opportunity and competitive differentiation for business, rather than a social obligation or cost of doing business porter. Csv is a way to grow economies, marketplaces, companies, and communities in the longterm interest of businesses and everyone else and enables a. On the surface of it, the proposition is fairly straightforward. In 2011, trust in business was plummetingbusinesses were perceived to be. In 2012, kramer and porter, with the help of the global notforprofit advisory firm fsg, founded the shared value initiative to enhance knowledge sharing and practice surrounding creating shared value, globally. It could also drive the next wave of innovation and growth as it opens managers eyes to immense human needs to be met, large new markets to be served, and the internal costs of social deficitsas well as the competitive advantages available from addressing them. One of ten key trends in 2012 creating shared value, by michael e. What is good for the community is good for business all profit is. Introduction creating shared value csv that is what harvard professors. Kramer 2011 came up with the concept of creating shared value, according to.
Creating shared value as future factor of competition. The present work analyzes the way financial intermediaries create shared value for society. The link between competitive advantage and corporate social responsibility. The prevailing approaches to csr are so disconnected from. However, it is found that all pcbs are not giving equal importance to each and. Investments in longterm business competitiveness that simultaneously address social and environmental objectives 3 f o r am edti lsc unf hv,p m. Kramer are the mckinsey award winners for creating shared value. The creating shared value approach has found strong resonance with many large multinational enterprises, including unilever, walmart and cocacola. Essentially, the shared value approach got coined by porter. Porter and kramer are the cofounders of both fsg social impact advisors and. A leading authority on corporate and competitive strategy, porter has written and talked a lot about the economic development and competitiveness of. Csv explained institute for strategy and competitiveness. It already has an acronym, csv, and its in fact a powerful concept for companies to use. Corporate social responsibility csr vs creating shared.
Todays businesses take the blame for many of societys economic, social and environmental woes, despite the launch of countless corporate social responsibility initiatives in recent decades. Pdf creating shared value csv has been presented as the saviour of. Creating shared value is a framework for creating economic value while simultaneously addressing societal needs and challenges. Profit involving shared value enables society to advance more rapidly and allows companies to grow faster the pursuit of shared value represents the next evolution of capitalism. Kramer 2011 came up with the concept of creating shared value, according to which companies can solve societal problems in profitable ways. Creating shared value through business model innovation. Porter and kramer are the cofounders of both fsg social impact advisors and the center for effective philanthropy, a nonpro.
He is the bishop william lawrence university professor at harvard business school, and he was one of the founders of the consulting firm the monitor group now part of deloitte and fsg, a social impact consultancy. First, the authors summarise the positive and negative criticism which csv has received since 2011. Creating shared value csv centre for business research. This article was the winner of the 2011 mckinsey award. How to reinvent capitalismand unleash a wave of innovation and growth by michael e. Csv vs csr i creating shared value vs csr explained. Although michael porters and marc kramers article creating shared value is a welcome attempt to mainstream business ethics among management practitioners, it is neither so radical nor.
Redefining capitalism and the role of the corporation in society. Kennedy school of government in cambridge, massachusetts. The concept of creating shared value csv was introduced and developed by porter and kramer 2011, p. Shared value is not social responsibility, philanthropy, or even sustainability, but a new way to achieved economic success. This book offers a contribution to the current academic discussions on the wellreceived. If not, here is their front cover story of the first hbr issue of 2011, with accompanying video, humbly. They put across the idea that if companies were to go beyond compliance and philanthropy to actively look for connections. Kramer is a senior lecturer at harvard business school and a cofounder. The concept of creating shared value csv was presented as the big idea that can help cure capitalisms ills. In creating shared value csv, porter and kramer merge corporate. Jun 04, 2012 what does the term creating shared value mean. Theory of creating shared value, crowdfunding, adding value, economic and social value. How to reinvent capitalismand unleash a wave of innovation and growth as well as subsequent reports by the associated social impact consulting group, fsg5.
Reorienting strategies and seeking international cooperation hwychang moon, jimmyn parc, so hyun yim, and nari park this paper improves the theory of creating shared value csv, a new way to achieve economic success, which was introduced by porter and kramer. Porter is a university professor at harvard, based at harvard business. Creating shared value responsible tourism partnership. This report evaluates westpacs success in relation to its strategy of creating shared value, which is a notion established by the banking corporation in bid to include various stakeholders in its decisions and company performance metrics. To sum up, porter and kramers 2011 ways to create shared value are classified as. The pcbs are creating shared value in line with porter and kramer s shared value concept without referring to it. In 2006, harvards michael porter and mark kramer published an article outlining a new concept for corporate responsibility. Creating shared value csv, the model for corporate social responsibility developed by michael porter and mark kramer of harvard business school, has been surprisingly controversial. Creating shared value concepts, experience, criticism. A free community for those working on shared value. Apr 01, 2011 by now, you will probably have read about michael porter and mark kramers latest foray into csrcreating shared value. To porter and kramer 2011, creating shared value represents nothing less than a reinvention of capitalism.
In recent years business has been criticized as a major cause of social, environmental, and economic problems. Creating shared value csv and creating competitive business. An extension of porter and kramers creating shared value csv. Current cases include discovery limited, dow, and more. Kramer, cofounder and general director of foundation strategy group. Kramer from the januaryfebruary 2011 issue executive summary reprint. A leading authority on corporate and competitive strategy, porter has written and talked a lot about the economic development and competitiveness of regions, states and nations. The ultimate guide on creating shared value michael porter. The concept of shared value is driven by renowned leaders in the area of business development and growth and has been approached by authors such as michael porter, a harvard university professor and author of several books on this subject and mark r.
The idea has generated strong interest in business and academia. Corporate policies and practices that enhance the competitiveness of a company while simultaneously advancing social and economic conditions in the communities in which it operates create economic valueby creating societal value. Westpacs success in creating shared value grades hero. Porter, speaking at the nestleiblf creating shared value forum, london, may 27, 2010.
Creating shared value csv and creating competitive. Ultimately, its a strategy for developing the future. View a list of published and inprogress case studies about how companies around the world create shared value. Aug 10, 2010 he introduced the concept of creating shared value csv as distinct from corporate social responsibility csr and explained how csv can help advance both the corporate and social goals of a. Strate gic decisions about h ow to allocate corporat e. The assignment must be submitted on blackboard word me and my group are doing a presentation on creating shard value me and my group are doing a presentation on creating shard value by porter and kramer. Creating shared value, an hbr interview with michael porter. Porter m e kramer m r 2011 creating shared value harvard. When businesses act as businessesnot as charitable donorsthey can improve profitability while also improving environmental performance, public health and nutrition, affordable housing and financial. In fact, creating shared value is one of the few new innovative strategy ideas from the last 10 years to help you build a sustainable competitive advantage. Porter defines shared value as policies and operating practices that enhance the competitiveness of a company while simultaneously advancing the social and economic conditions in the communities in which it operates. This article offers a fundamental critique of michael porter s and marc kramer s creating shared value csv concept.
Second, purely functionalistic and valuefree concepts like csv are neither. We need to understand that whats good for the community is actually good for business, said porter, explaining csv. What is good for the community is good for business all profit is not equal. However, creating shared value will require identifying opportunities tailored to each units particular business in each of the three areas described above. How to reinvent capitalism and unleash a wave of innovation and growth. Eventually, some five yearsaftertheirinitial formulation, the fullyrealized elaboration of sharedvalue was set out by porter and kramer in the cover article of the januaryfebruary 2011 issue. Harv bus rev 8912, 6277, 2011 introduced shared value as a new conception of capitalism, claiming it is a powerful driver of economic growth and reconciliation between business and society. An extension of porter and kramers creating shared value. The concept was further expanded in the january 2011 followup piece entitled creating shared value.
Creating shared value, an hbr interview with michael. Michael porter and mark kramer, writing in hbr december, 2006 and januaryfebruary, 2011, advance the idea of creating shared value by developing strategies and policies that enhance the. Castro capella university mba6008 global economic environment professor hidsell january 27, 20 creating shared value csv is a powerful concept that many companies used, ultimately, being. How to fix capitalism and unleash a new wave of growth. This shared value thinking is a powerful force to drive growth in the global economy and involves a whole new set of best practices and strategic opportunities. Major events dedicated to creating shared value in many. Apr 03, 2011 michael porter, pope of corporate strategy, comments on his recent article about creating shared value. In this article, they debut the shared value concept and the new approach for linking strategy and society. Porter and kramer 2011 gave relevant examples of how efficient processes are aimed at adding value to the firm and to society at large. Reporting by michelle matthews creating shared value. If not, here is their front cover story of the first hbr issue of 2011, with accompanying video, humbly titled how to fix capitalismthe big idea. The contribution of porter and kramers concept of creating. Major events dedicated to creating shared value in many countries creating shared value as a key trend forbes. Overcoming the challenges of the new era of globalization.
Over the last years, creating shared value has become a much discussed concept in business practice as well as in management theory and especially in the context of corporate social responsibility. If the hypothesis holds true that csv constitutes a. So, how did the creating shared value theory come about. Csv is therefore firmly embedded not just in the field. Following the hbr article creating shared value by michael porter and mark kramer published in january 2011 the author witnessed an online debate on the. Michael porter, pope of corporate strategy, comments on his recent article about creating shared value. By now, you will probably have read about michael porter and mark kramer s latest foray into csr creating shared value. Pdf kramer porter 2011 creating shared value wanting.
The contribution of porter and kramer s concept of creating shared value to csr theory natalie junge masters thesis business economics business management, corporate governance publish your bachelors or masters thesis, dissertation, term paper or essay. In recent years business increasingly has been viewed as a major cause of social, environmental, and economic problems. The creating shared value proposition substantia mea. An extension of porter and kramer s creating shared value csv. The onetrick pony approach by thomas beschorner a comment on michael porter and mark kramer 2011, creating shared value, harv bus rev 8912. Social political context of management essay superb.