Corporate social responsibility has come a long way from the days of handing out checks and doing good. It’s even gone beyond strategic CSR, in which businesses try to do more than donate money. Today, many companies are shifting to the concept of “shared value.”
This new phase was the focus of a panel discussion here at B4B led by Lalitha Vaidyanathan, managing director of FSG. “Corporate responsibility of the future needs to come from the core business,” she told the audience. “You’re creating social good while creating economic value for the business.”
Shared value requires approaching business in a much different way, she said. Corporate philanthropy still has a role, but companies need to think if there are bigger, more scalable ways for them to create social change. Both large and midsize companies can participate, she said.
“You can create shared value no matter the size of your company,” Vaidyanathan said.
To illustrate companies that have implemented shared value strategies, she cited the example of Mars, which helped cocoa farmers make more money and become sustainable so that they can continue to supply the company. Nestle, she said, developed a new fortified food product to address malnutrition issues in India.
“If you look at how your business intersects with society, every company can figure out how to create shared value,” she said.
Panelist Adam Lowry, co-founder and chief greenskeeper at Method Home, talked about how he started his soap and cleaning products company with the goal of using a business “to create positive social and environmental change.”
Method products are designed with sustainability built in, he said. The company’s strategy has paid off, he said: It’s growing in strong double digits and is profitable to boot.
For Verizon Communications, adopting the shared value concept was an evolution as the company tried to figure out where its future growth would be, said panelist Christopher Lloyd, executive director, public policy and corporate responsibility at Verizon.
As it looks to the future, Verizon is focused on boosting energy efficiency, improving the quality of education and health care, Lloyd said.
For example, by providing wireless technology in the classroom, Verizon can help advance STEM (science, technology, engineering and mathematics), which meets the needs of the community but also the company, he said.
Verizon found a new market in working with the disabled community, he said. To serve the needs of the deaf, the company developed a text-only service plan. “This market is sticky. It becomes very loyal,” he said.
Panelists told attendees not to expect to shift to a shared value strategy overnight. It can be hard to get a business to focus on something that has a long-term payoff.
“This does take time,” Vaidyanathan said.
While the shared value concept may be new for some companies, it’s a familiar one for Jessica Vom Steeg, individual and corporate giving manager at Chrysalis of Santa Monica, Calif. Still, it was good to hear about what a large company like Verizon is doing as well as a newer business like Method, she said.