Entries in corporate social responsibility (3)


A critique of Creating Shared Value

Measuring and managing non-financial performance is a cornerstone of the Economics of Mutuality. In order to develop new business models in which mutuality drives superior business performance, it is necessary to understand, quantify and track non-financial forms of "capital," such as social, human, and natural. In doing so, we seek to successfully decipher the patterns that drive shared prosperity to low income communities, among other goals.

Various theories and systems have been put forward recently related to this field, including Michael Porter and Mark Kramer's Creating Shared Value (CSV), a concept they outlined in Harvard Business Review.

CSV has received significant attention since its publication, gaining a wide audience in academic and business circles, but it has also attracted its share of criticism. Rigorous review and testing are essential to learning an progress, and we found this critique of CSV -- published by professors from a number of prominent business schools -- to be worth reading.

We suggest that the concept makes some significant progress towards enhancing attention to the social dimensions of business, and may act as a spur for better practice. However ... CSV also suffers from a number of serious shortcomings that will erode any real possibility for the more fundamental change aimed at by the authors."  

-- from Contesting the Value of "Creating Shared Value"

In it, the authors find CSV has serious shortcomings, namely: it is unoriginal; it ignores the tensions inherent to responsible business activity; it is naive about business compliance; and it is based on a shallow conception of the corporation’s role in society.



Next wave of social innovators blur the line between profit and purpose

In a recent Fast Company article, Phillip Haid, the co-founder and CEO of PUBLIC, a cause-marketing agency and incubator, stated companies have realized the value of combining the revenue-generating and philanthropic sides of their business, believing that co-existence produces greater impact and revenue.

He identifies four companies within the next wave of social innovators that embrace profit and purpose as the new way to do business:

  • Uncharted Play produces an energy-harnessing soccer ball called the Soccket. It provides off-grid power to kids and families in rural and remote areas and refugee camps to improve learning, air quality, and health and increase income potential;
  • Teeki provides eco-conscious, conflict-free activewear made from recycled plastic bottles;
  • Rareform repurposes billboards into surf bags, backpacks and totes, and is a member of 1% For The Planet program, which means it donates 1% of its revenues; and
  • LSTN takes proceeds from every pair of headphones sold and puts them towards restoring hearing to one individual.

Phillip Haid concludes that creating a social impact doesn't require companies to go outside themselves to effect positive change.

What other social purpose businesses are you aware of? We'd like to know.


Corporate Responsibility and Sustainable Economic Development in China: Implications for Business

This paper provides a strategic briefing on the state of corporate social responsibility (CSR) in China. It seeks to inform companies, policy researchers, and stakeholders concerned with China’s development and CSR more generally. A note on terminology: “CSR” has become the most common umbrella term in China for the constantly evolving domain that includes the social, environmental, and economic impacts of business. For the purpose of this paper, CSR is treated as analogous with the international use of terms such as corporate responsibility and business sustainability.

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