Shared value is a management strategy in which companies find business opportunities in social problems. Historically, corporates saw the environment, society and local economy as threats to profits, but these are indeed opportunities to make the world a better place and increase profits. Ignoring these critical factors put the future of businesses at risk.
While embracing shared value gives businesses the competitive edge, this requires a shift in mind-set to a broader, long-term focus on creating shared value. This operates on three levels:
- Reconceiving products and markets in ways that meet customers’ needs but also contribute to society;
- Redefining productivity through social or environment innovation;
- Embracing cluster development, which entails supporting the wellbeing of industries related to your own in ways that improve social conditions. More companies are now building and rebuilding business models around social good, which sets them apart from the competition and augments their success.
Purpose of the Summit
In May, GreaterImpact attended the 2018 Africa Shared Value Summit in Sandton, South Africa. The purpose of the Summit was to raise awareness and advocate for the success of the strategic implementation of the shared value business model, which aims to bring about social change while positively impacting profit. The event also aimed to deepen and continue the shared value conversation, with a focus on implementation, impact and how shared value can be used as a vehicle to implement and align businesses to the Sustainable Development Goals (SDG).
Who was in attendance
There was a diverse range of organisations in attendance, including: Barclays Africa Group, United Nations, Amnesty International, AngloGold Ashanti Ltd, World Food Programme and Nando’s, to name a few.
Day 1: Speakers
Day one of the highly anticipated summit, themed “Building Business for the Future”, featured four key speakers: the Chairman at Barclays Africa Group Wendy Lucas-Bull, UNDP’s Economic Advisor Fatou Leigh, Amnesty International Regional Director of Southern Africa Deprose Muchena, Old Mutual Group Head of Responsible Investment Jon Duncan, and AngloGold Ashanti Limited’s Vice President (Group Sustainability: Health & EVP Support) Brian Chicksen. The speakers eloquently spoke on three critical topics: Implementing business’s social agenda, building and strengthening agricultural capacity and food security, and a green future: water, energy & waste.
Creating shared value: Implementing business’ social agenda
The starting point for shared value is identifying and prioritising specific social issues that represent opportunities to increase revenue or reduce costs. This requires a systematic screening of unmet social needs and gaps and an analysis of how they overlap with the business. This was a key take-away from the talk by Wendy Lucas-Bull, the Chairman at Barclays Africa Group, who reminded all that shared value is about embedding our thinking so that society benefits. UNDP’s Economic Advisor, Fatou Leigh, followed the welcome address with an eye-opening ‘Perspective on Our Progress’ presentation. Touching on the SDGs, Leigh stressed “the shared value concepts, sharing of benefits and allowing for greater participate in the generation of growth.”
Agricultural ecosystems: Building and strengthening agricultural capacity and food security
A long-standing challenge is measuring social outcomes for large populations. For example, how does one measure the social impact of a healthier food product that reaches millions of customers? Prerana Issar was the next to speak on the topic of agricultural ecosystems. Issar is the Global Head of Private Sector Partnerships at the World Food Programme. She believes that “zero hunger is possible”, but emphasised that, currently, 224 million people in the world go to bed hungry: “In 2017, the World Food Programme managed USD 7 billion. We would need to spend USD 270 billion annually to achieve zero hunger.” However, the kicker is that over USD 750 billion is lost due to food waste.
Speaking about ecosystems, Jon Duncan, Old Mutual Group Head of Responsible Investment, began with a strong statement: “An economy cannot exist without a functioning society.” He stressed the need to align s to social agenda. “Organisations need to shift to an ecosystem thinking to achieve shared value. The virtuous cycle of growth includes businesses being mindful of environmental and social impact.”
As we mulled over the insights delivered by the various speakers, 9:30am struck and marked the start of the day’s first panel discussion, ‘Creating Shared Value: Implementing Business’s Social Agenda’. The discussion featured James Mwangi (Executive Director, Dalberg Group), Brian Chicksen (Vice President: Health & EVP Support, AngloGold Ashanti Limited), Jon Duncan (Head of Responsible Investment, Old Mutual Group), and Eugene Boadu (Head, Corporate Affairs, Mpedigree Ghana). Mwangi focused on how we can leverage private sector investments to achieve the SDGs. Mwangi further explained that “the Sustainable Development Goals can be broken down into three simple shared value statements: 1. Achieving an equitable world, 2. Achieving a sustainable world, 3. Achieving an inclusive world.”
A green future: Water, energy & waste
Green engagement is vital within the shared value space. Businesses should assess their environmental footprint by identifying water and waste as environmental and social issues with significant shared value potential. Deprose Muchena, Amnesty International Regional Director of Southern Africa, gave a short thought-provoking commentary: “The African continent remains the richest in natural resources but the poorest in human capital development. We test the integrity of a society and of development by how it treats the most marginalised groups.” Muchena added: “The private sector is the biggest driver of development in Africa. We need business models that invest in extractive and human capital development.” The day came to a close with AngloGold Ashanti Limited’s Brian Chicksen sharing how they embedded the SDGs into their business strategy and how this has shifted the mining business’ thinking.