Creating Shared Value

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    Anonymous User37Anonymous User37
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    Shared value is described by Michael Porter as “applying the capitalist model to address issues in society” such as world hunger and environmental issues. The aim of creating shared value is to highlight how companies can solve these issues while profiting off them and they do not need to stick to traditional methods of business to create a profit. Creating shared value differs from corporate social responsibility as it looks at changing the way the capitalist structure is used instead of investing profits made from the traditional structure into the company’s idea of their social responsibility. There are three ‘buckets’ to practice CSV;

     

    The product and the potential consumers needs

    The value chain – such as logistics and customer service

    ‘Cluster’- the other businesses involved in the production of the product

    An example of a business using this method is Nestle. Nestle believe their company “can only be successful in the long term by creating value both for our shareholders and for society.” Nestle has three main ambitions focused on the individuals and families that consume their products, the communities where their products are grown and the planet.

     

    These ambitions are;

     

    1.”For individuals and families, to help 50 million children lead healthier lives.

    2.For our communities, to improve 30 million livelihoods in communities directly connected to our business activities.

    3.For the planet, to strive for zero environmental impact in our operations.”

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