The main principle of shared value is that it provides economic value in a way that also creates economic value for the society. This achieved by addressing the challenges and needs of the society. Recently big companies such as Google and IBM have started to use this Shared Value approach. If companies want this to be successful it is said that they have to change their main aims and focus on bringing this culture of shared value into there company. This will drive the next wave of innovation and productivity growth in the global economy.
There are three ways that companies are able to create Shared Value Opportunities.
By reconceiving products and markets
By redefining productivity in the value chain
By enabling local cluster development
A good example that i thought would be relevant is Fair Trade. These days Fair Trade give more money to poorer farmers for crops simply because there poor. In my opinion this isnt “Fair”. If they took the shared value approach to this , the farmers would be shown how they can improve all aspects of their work and inturn increase productivity which will then increase revenue. A study was in Cote D’voire that showed that Fair Trade would increase your income by 10 or 20% but a shared value approach would increase your income by 300%.
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