Shared Value and Corporate Social Responsibility

An old childhood friend of mine who grew up with me in Battersea on a local council estate and is a successful Senior Non Profit Executive in United States suggested that the culture of philanthropy is more embedded in the US than is it in the UK, stating that US Banks are required to designate 1.25% of gross pre tax to support charitable giving. My friend having successfully traversed the non-profit corporate ladder in the states and being at the top of his game, opened my eyes some years ago to the concept of shared value used by corporations as an alternative to advertising to establishing their brands.

Shared value is a management strategy focused on companies creating measurable business value by identifying and addressing social problems that intersect with their business.

Articulating how using the shared value concept was a key element in successfully raising funds for his non-profit from corporations. Being a win-win where financial and human resource contributions to address social challenges in the local community made by the corporate organisation enhanced the reputation of their brand and would gain as much publicity as would their marketing spend. And that this thinking is developed into a formulaic construct in soliciting corporate sponsors and donors.

The shared value framework developed by Michael E. Porter and Mark R. Kramer in their article “Creating Shared Value” in the Harvard Business Review in Feb 2011 suggests that separation between big business and society by its narrow focus on making profits at the expense of society can be counteracted by creating value in a way that also benefits society. Creating Shared Value had to be reconnected making money with social progress.

In the UK shared value at grassroots level has some way to go. There’s no doubt that many SME’s have a concern for the communities within which they operate; and increasingly more UK corporations are taking part in initiatives to support local community groups and charities. Anecdotally, my perception that because of a lack of an entrepreneurial culture, and a more rigid voluntary/non-profit sector in the UK, more could be done by smaller organisations to seek partners from the local business community to support their initiatives in building capacity to deliver much needed services that are under attack from austerity measures.

A major challenge for small groups is having the capacity to build the relationships in the first place, and that the impact of austerity is the sense of everyone looking through a lens where the glass half empty. Especially with the aggressive fundraising tactics used by some of the larger charities, on high streets employing university types to accost people to sign them up to monthly direct debits, and the door knockers, in my opinion who overstep the mark with guilt ridden persuasion tactics.