The concept of creating shared value
stems from the foundational concept that the purpose of business is
to satisfy the needs and wants of consumers. The most successful
businesses in the world are the greatest servants of society, because service is good business. This idea is what creating
shared value is all about: finding ways to satisfy the needs of
society that inevitably benefits business.
The idea that creating shared value is
good business answers the concerns around Corporate Social
Responsibility, which has the reputation of being akin to charity and
However, the concept of shared value
reveals that corporate social responsibility should be approached
from a business-perspective. By taking responsibility for the
well-being of consumers, businesses benefit themselves.
Origins of Creating Shared Value
The origins of this business concept
comes from the Harvard Business Review, and was further elaborated on
by Michael Porter. His premise is that consumers and companies are
dependent on each other, and that benefiting one will inevitably
benefit the other.
Ultimately, creating shared value is
actually returning to the foundational purpose of business by
defining it as good business practice to place the focus away from a
sales-orientation (business first) in favor of a customer-orientation
(customer first) perspective that results in lasting successful
A sales-orientated perspective
communicates to consumers that the business is only concerned with
its own needs, whereas customer-orientation communicates that
businesses want to benefit consumers. Consumers do not care about
company needs. They care about their own needs, which is why
advertisements that focus on benefits, instead of features, result in
Creating shared value is good business because it
benefits companies via supporting the economy, supporting supply chain
members, and assisting in product development.