Creating Shared Value

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    Anounymous User38Anounymous User38

    From my understanding, creatin shared value relates to businesses applying a capitalist model to addressing social issues in society, e.g hunger, environment, water and health. Capitalism can be described as an economic and political system in which a country’s trade and industry are controlled by private owners for profit, rather than by the state. To explain capitalism in short terms – it is about making a profit. The idea of creating shared value is to increase profits in a business while also tackling social issues, which have already mentioned above. We are essentially re-thinking how we practice capatilism.


    According to Michael Poter, an American academic known for his theories on economics, business strategy, and social causes, “Adopting environmentally sustainable policies has been shown to be good for business, for example – through the lower production costs associated with reduced raw material and energy usage”. I completely agree with Porter here, as we can see the shared values between how the business operates and the environmentalists and the majority of people who care about our planet. The businesses are saving money through lower production costs, while they are also reducing emissions and preserving raw materials, which is eco-friendly and good for the planet. Companies can save massive amounts of money by saving energy, being more efficient with their usage of resources and re-thinking their packaging. Even capitalists, who have no interest in being environmentally friendly, can argue against this as Porter mentions “It’s not about being a good guy, it’s about doing business in a smart way”.


    Since taking notice to Porter and his thoughts regarding creating shared value, I am now a huge believer that there are plenty of ways for businesses to be profitable while also tackling social issues, if done correctly. Creating shared value is essentially a win-win situation for all parties, and in hindsight is a great theory if it can be put in place correctly.

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