Why is it so critical that the private sector participates in addressing sustainable development? Because companies are the primary creators of value in the world. If companies are not part of the solution, there is no way for governments and non-profits alone to solve the world’s most pressing problems.
Outdated Approach
The value created by companies answers economic needs and supports societies, governments, and non-profits through wages, taxes, and philanthropy. Unfortunately, most companies remain trapped in a narrow view of value creation, focusing on short-term financial results. What if we rethink value creation through a broader lens – answering long-term societal needs? Natural resources vital to business, customers’ and employees’ well-being, the viability of key suppliers, and other long-term performance factors become priorities. As a result, companies create an economic value that is equally balanced with social and environmental values. This is called creating shared value, a term coined by Harvard Business School’s Michael Porter and Mark Kramer.
Mindset Shift
A huge mindset shift and new skills are required to embrace shared value, such as a deep understanding of societal needs, a detailed comprehension of a company’s productivity, and an ability to collaborate across profit and non-profit boundaries. Adopting shared value strategies drives innovation, creativity, and performance. Global companies – like the carpet manufacturer Interface – have demonstrated that aligning profit and purpose unlocks new pockets of growth.
Local Ecosystem
Shared Value Initiative Hong Kong, part of the shared value global network, disseminates knowledge and best practices for creating shared value, and bridges stakeholders from various sectors and industries to form impactful partnerships. Come join us at the People & Purpose Theater on Day One to learn from our ecosystem about collaboration, innovation, and the challenges of creating shared value.