MAKING A DIFFERENCE

YIt’s the latest buzzword you’ll hear at a thousand conferences: shared value. But what does it really mean and how can the concept be implemented practically in companies? ou’d be forgiven for thinking that “shared value” is just a buzzword to obscure the real reasons businesses exist: to make profit and deliver returns to shareholders.

The concept made its debut in a 2006 Harvard Business Review article by a Harvard Business School professor, Michael Porter. “Shared value is not social responsibility, philanthropy or sustainability, but a new way for companies to achieve economic success,” he wrote at the time.

Later, in 2012, Porter and consulting firm FSG launched the Shared Value Initiative, which advocates a business strategy that “reconnects company success with social progress”. Only, that still sounds a little too much like jargon that only MBA graduates would understand.

Shift Social Development CEO Tiekie Barnard admits that, even in countries that have been grappling with the concept for a lot longer than SA, there is still confusion.

“People still confuse [shared value] with cor-

porate social investment,” she says. “Some companies have taken the word sustainability and replaced it with shared value.”

These companies “talk it” and may believe they are doing it, but don’t really make the grade when you dig a little deeper, Barnard says.

At its heart, shared value is really about developing business-driven solutions for social problems. Put differently, driving positive social change while making a profit.

This is easier said than done. And quite which trade-offs should be made to achieve this is not always clear. For example: should a company employing thousands of people and paying billions in tax be shut down because its business practices are not always environmentally friendly?

This month, Shift Social Development, a shared-value consulting firm, will host the 2018 Africa Shared Value Summit in Johannesburg, which aims to grapple with these issues.

Barnard hopes the event will create greater awareness of shared value among African companies and give them the tools to implement it in their businesses.

It follows the lead of the Shared Value Leadership Summit, held annually in New York in May. Barnard recounts how, at the New York conference, Porter spoke of how this was “only the beginning” of the shared value journey.

“It is a young business concept, we have to give it that,” she says.

Barnard argues that there needs to be an “Africa strategy” for shared value. This month’s summit, she hopes, will forge relationships between companies, not-for-profits, nongovernmental organisations and foundations to implement the concept in Africa.

For example, partnering a renewable energy company with an agricultural organisation could help to develop more sustainable farming methods on a larger scale.

“The shift has to come from investors,” says Barnard.

In other words, asset managers, who are deploying capital given to them by savers need to be aware of environmental, social and governance issues. So, just as fairtrade advocates won’t buy goods and services from