Creating Shared Value
– A Better Way of Doing Business?

Consumers no longer unquestioningly accept what they hear in the media to make brand-based purchases. They want to know how your company generates positive change as a core part of its services or products. Creating Shared Value (CSV) is helping to drive a different kind of business.

CSV is a business strategy in which companies create economic value while also creating value for society by addressing its needs and challenges.

This approach goes further than traditional Corporate Social Responsibility (CSR), because it makes social impact part of the core business model, not just a side project. This can lead to innovative solutions that have the potential to improve community conditions and contribute to business growth.

For instance, a company that recycles and resells old chemicals from a lake benefits the community by cleaning the environment while making money. In essence, this is an approach that aims to create business value while addressing social and environmental considerations.

Professor Michael Porter and Mark Kramer introduced this concept in a 2011 Harvard Business Review article.

Since 2011, Porter and Kramer have expanded the CSV concept, pointing out that effective shared value creation needs collaboration across different sectors, measurable impact on social and environmental issues, and open, honest practices. They stress that companies must genuinely commit to these principles throughout their organisation to avoid superficial ‘CSV-washing’.

This approach connects with the growing importance of ESG (Environmental, Social, and Governance) frameworks, which many businesses now use to track and report on their sustainability efforts.

As society becomes more environmentally conscious and aware of the impact of long working hours and corporate policy on personal lives, we are becoming more aware of how these factors are linked. Environmental practices, working patterns, and corporate policies all shape wellbeing and public expectations.

By embracing CSV strategies, organisations can increase their profitability and sustainability and strengthen their public image at the same time.

Creating shared value is a relatively new concept, unlike CSR. The two are often confused, but have very different focuses.

CSR focuses on ethical practices and philanthropy. It often involves activities separate from a company’s core operations, such as charity outreach. CSR also frequently focuses on external initiatives and brand reputation.

While CSR focuses on embedding social considerations into organisational activities, CSV seeks to integrate them directly into the core business model for mutual benefit.

Does my organisation need both?

Your organisation can benefit from having both CSR and CSV because together, they form a balanced strategy.

CSR helps you meet immediate social responsibilities, while CSV helps create long-term growth that’s good for business and for society.

According to the original article by Porter and Kramer, there are three ways organisations can create shared value:

• Reconceiving products and markets: Developing profitable products and services that meet the needs of the organisation’s customer base whilst fulfilling social issues and improving local communities, or reducing environmental impact.
• Redefining productivity in the value chain: Identifying and successfully addressing social and environmental problems associated with your industry whilst increasing your company’s productivity and boosting your suppliers’ revenues and operational capacity.
• Enabling local cluster development: Enhancing the business environment around your company by supporting the growth and efficiency of related industries, suppliers, and infrastructure in your region. This can involve investing in local skills, collaborating with educational institutions, improving supply chains, or working with local partners and authorities. This helps create a local ecosystem that benefits your business and the wider community.

The benefits of creating shared value to the wider community and environment are clear, but what are some of the secondary benefits for companies, other than an increase in profitability?

• CSV can encourage innovation: By integrating social and environmental goals into the core business strategy, organisations are encouraged to innovate continually, developing new products and services that meet societal needs. This focus on innovation could lead to a competitive advantage, as businesses could differentiate themselves in the market through unique solutions that address real-world issues.
• It can enhance employee engagement: Aligning business objectives with societal impact could increase employee motivation and satisfaction, as employees frequently feel more fulfilled working for an organisation that prioritises purpose alongside profit. This may lead to higher productivity, improved morale and lower staff turnover.
• Your initiatives serve as a form of marketing: It becomes clearer to your stakeholders how your services or products contribute to community benefits.
• It goes beyond gestures: CSR actions have sometimes been viewed as inauthentic or publicity stunts, but creating shared value is designed to go a level deeper, actually linking the delivery of services and products with clearly defined, ongoing benefits. It represents a sustained operational approach that naturally communicates your organisation’s societal contributions, moving beyond mere promotion to genuine impact.
• It’s not just donations: Rather than simply redistributing profits to charities, organisations may spearhead changes in their local community. When people see change on their doorstep, they may be more likely to become passionate advocates.

Despite these benefits, implementing CSV isn’t without its challenges. Businesses may need to invest in new capabilities to measure and report real social impact, avoid superficial claims, and balance short-term financial pressures with longer-term societal goals. Integrating CSV authentically can require strong leadership and organisational commitment.

Many business experts believe that creating shared value is becoming increasingly crucial for long-term business success in the UK and globally. Porter and Kramer argue that integrating social and environmental considerations into core business strategies benefits society and drives competitiveness and sustainable growth.

UK consumers are paying closer attention to how companies operate, including their transparency. They may be more likely to trust and support brands that demonstrate genuine social impact. 63% of all UK adults agree that brands should increase communications about the sustainability of their products and services, reflecting widespread consumer expectation for ethical and environmental responsibility.

There has been criticism that some firms engage in tokenistic CSR rather than embracing the systemic operational changes needed for CSV, leading to missed opportunities in innovation, stakeholder trust, and meaningful impact.

With growing public concern about social justice and corporate accountability, businesses can play a leading role. Companies that demonstrate a commitment to progress could be more likely to earn trust, attract investment, and grow.

Traveleyes

UK travel company Traveleyes is an excellent example of Porter and Kramer’s CSV concept in action. Founded in 2004 by Amar Latif, a blind entrepreneur and television presenter, the company provides holidays for blind and visually impaired travellers.

By pairing sighted and visually impaired travellers, Traveleyes introduced international travel experiences to a demographic previously excluded by conventional tour operators. This created both social value – increased accessibility and independence for visually impaired people – and business value through targeting a profitable niche in the travel industry.

Traveleyes’ operational model transforms what might be considered a limitation into a strength. By offering discounted rates to sighted travellers in exchange for describing surroundings and assisting visually impaired companions, the company creates cost efficiencies and offers more personalised experiences where each participant contributes to, and benefits from, the experience.

This case study demonstrates that addressing societal challenges can be the foundation of a successful business model rather than just a philanthropic activity. This perfectly aligns with Porter and Kramer’s vision of CSV as creating economic value by creating societal value.

In addition to Traveleyes, organisations like M&S, Danone, and Patagonia demonstrate the benefit beyond profit of committing to CSV.

Patagonia

The outdoor clothing company integrates environmental responsibility into its core business by using recycled materials, supporting fair labour practices, and encouraging customers to repair rather than replace products.

The company donates a percentage of sales to environmental causes and actively campaigns for conservation, all while remaining profitable and cultivating a loyal customer base. Patagonia’s Worn Wear programme and commitment to transparency in its supply chain benefit the planet, local communities, and the business itself.

Marks & Spencer

M&S stands out for its Plan A sustainability programme, which tackles environmental and social challenges throughout its operations and supply chain. By sourcing sustainable materials, collaborating with suppliers on ethical standards, reducing waste, and engaging customers in recycling and community projects, M&S benefits its business and society.

This approach has improved efficiency, strengthened stakeholder relationships, and shown that commercial success can align with positive social and environmental impact.

Danone

Danone creates shared value by integrating health, nutrition, and sustainability into its business. It partners with local dairy farmers to promote sustainable agriculture and improve community livelihoods through the Danone Ecosystem Fund.

The company focuses on reducing its environmental impact by cutting emissions and advancing regenerative practices, while offering healthier products tailored to consumers. Aligning business growth with social and environmental benefits, Danone demonstrates a sustainable model that benefits society and the planet.

Nestlé UK & Ireland

Nestlé integrates sustainability, nutrition, and community support into its business strategy. During the Covid-19 pandemic, it collaborated with the Scottish Environment Protection Agency (SEPA) and other partners to promote circular economy initiatives and sustainable food production, benefiting local environments and communities.

Nestlé aligns business growth with social and environmental benefits by reducing environmental impact, supporting sustainable farming, and offering healthier products, generating shared value for society and shareholders.

A number of ISO standards could support your organisation’s broader corporate responsibility efforts aligned with CSV.

ISO 9001 (Quality Management) supports CSR and CSV goals by promoting stakeholder focus, transparent processes, and continual improvement, essential for reliable social and environmental reporting. Inclusion of social and ethical considerations in Quality Management System (QMS) ISO 9001, can further demonstrate a broader commitment to CSR principles. Learn more about how ISO 9001 certification can help you improve customer loyalty and operational excellence.

ISO 14001 (Environmental Management): This certifiable standard helps organisations manage and reduce their environmental impact, going hand-in-hand with corporate social and environmental responsibility. Learn more about ISO 14001.

ISO 45001 (Occupational Health and Safety Management) covers occupational health and safety, contributing to the social side of CSR and CSV, by ensuring safe, healthy, and fair workplaces. Learn more about ISO 45001.

Get started on your journey to ISO certification – get a free quote today or contact our expert team to discuss your needs.