Framework 72 Shared Value

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Introduction
- it is about how firms can grow profits while delivering value/benefits to the community
- it is a refinement of the concept of corporate social responsibility (CSR). CSR is based on firms donating money to charity and the not-for-profit sector.
- Questions being asked include
i) does it work?
ii) is it good PR?
iii) will it replace CSR?
iv) is it considered an unwanted distraction, ie takes management's focus away from its fundamental responsibility to deliver returns to shareholders

Some examples include
- Vodafone (UK-based telecommunications firm) and Safaricom (Kenyon mobile network operator). Vodafone developed the M-Pesa mobile money transfer and payment system to target 2.6 b. people who do not have a bank account. Using Kenya as the trial market, around 18 m. customers joined in 6 years. Over 40% of Kenya's GDP is now transacted through M-Pesa and it has around 100% customer loyalty.
- IAG (an Australian-based firm) owns NRMA, CGU & SGIO, has developed a project to design new affordable insurance products to protect the assets of low income families plus a research centre to look at car crashes and road safety
- Westpac (an Australian bank) that since 1817 has initiated disaster relief funds to support communities impacted by natural disasters like floods, bushfires, etc.. It also allocates funds to social and affordable housing plus clean tech and environmental services
- Coles (an Australian-based supermarket) has a partnership with the charity SecondBite which distributes fruits and vegetables that would otherwise go to waste to homeless people.
- NAB (an international Australian bank) working with those struggling with debt payments to lower their debts; it has reduced bad debts by 20% and saved A$ 7.2 m.
- Lion Nathan (an Australian-based food and drink producer) which has developed low-alcohol beers and healthier dairy products and drinks
- Bendigo & Adelaide Banks (an regional -Australian banks) that have opened branches in rural communities with agreements that a significant, pre-agreed percentage of any profit will be distributed to local community initiatives, such as sports and other recreational facilities.

A shared value approach allows business to promote itself to the public and other stakeholders as a caring corporate citizen while boosting the bottom line
"...At its essence it is about how to tackle social issues in a way which will benefit the business, either through new products and services cost savings..."
Ramana James of the Insurance Australia group as quoted by Patrick Durkin, 2015
(source: Partick Durkin, 2015)

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