Putting sustainability at the core of their business strategy and linking societal needs with business growth is becoming more popular between modern corporations. Michael Porter from Harvard University calls this approach creating shared values (CSV). This means that companies can grow their business and profitability while building sustainable, scalable solutions for societal challenges such as access to healthcare, education, and nutrition, but also to protective solutions, water management, and mobility.
I looked at how five well-known companies implement this new approach:
Three years ago Unilever set out the Sustainable Living Plan (Twitter #sustliving), a ten-year journey towards sustainable growth and improving people’s health and well-being. This plan addresses global challenges while contributing to Unilever’s business growth. A good example is the company’s global handwashing campaign sponsored by Lifebuoy, Unilever’s leading anti-bacteria soap brand.
Handwashing with soap is one of the most effective and inexpensive ways to prevent some of the leading causes of death among children in developing countries each year. So Unilever focuses on establishing behavior change in schools and communities across Kenya, Vietnam, and Zimbabwe – three countries where handwashing with soap practices are low. In Kenya, for example, 28 percent of the school children report washing their hands with water at key times during the day, yet only 1 percent report using soap.
By educating communities in developing countries with hygiene promotion activities, Unilever grows its market and without doubt, Lifebuoy has become a market leader and the preferred brand of choice.
TenCate, a market leader in artificial grass fibers and geotextiles announces recently their participation in the GreenSource Sports for Water project. GreenSource includes the construction of a synthetic sports field with a drainage system to harvest rain and river water that is treated in membrane filters. TenCate cooperates in this sanitation and sports project with two other high tech companies: Pentair and Wavin. In the coming months, they collectively will install at least 20 GreenSource systems in South Africa.
The system achieves two goals: on the one hand, sustainable water buffering, water filtration and water distribution, and on the other, high-quality multi-sports activities on high-quality synthetic turf football pitches. Football is really important in South Africa and charismatic archbishop Desmond Tutu regularly said: “Soccer isn’t like a religion in Africa. It is bigger than religion.”
Many believe that football in South Africa has become an effective social and developmental tool and that it’s shaping a new future for South Africa. So having high-quality football pitches that will change rain and river water into clean drinking water is considered hugely relevant.
In the North West Province of South African, the GreenSource systems will be installed near schools. In this region, only 27% of households have access to safe drinking water, and various local communities are even faced with a total lack of sustainable drinking water. In this way, TenCate and its partners help build a market for their sustainable products and address the problem of shortage of safe drinking water and the need for sports facilities. Lack of safe drinking water is one of the factors that allow poverty to persist and slow down economic progress in Africa.
DSM recognizes that there are real problems in developing countries such as hidden hunger and malnutrition. Malnutrition is a serious condition that occurs when a person’s diet does not contain the right amount of nutrients. This condition could be tackled for example with fortified rice that contains necessary vitamins and minerals. And because rice is such a popular and inexpensive food, hidden hunger and malnutrition problems could be relatively easily solved. The company clearly states that in its Annual Reports.
DSM developed high-quality fortified rice that delivers calories and major micronutrients that are essential for good health. But realizing how complex food distribution in developing countries is, DSM partners with the United Nations World Food Programme (WFP) on a strategic approach to rice fortification. DSM dedicated USD 1 million to World Food Programme nutrition activities in Asia to support rice fortification policy and program development. When this program will be developed it will create a huge market for DSM fortified rice.
Another example will be Randstad’s latest program called “Jeugd op zoek” (translated as “Young Seekers”). Randstad launched this program to help young people finding the first job, and they approached entrepreneurs and corporations via the media and asked them to create jobs for young, just out of school people. They also organized free training for job seekers, and this way, during 7 weeks they helped almost 10 000 young people to find a job, which was many thousands more than Randstad normally would have been able to do.
Did this action help Randstad with brand awareness and brand preference? Yes, absolutely, but at the same time these 10.000 young people became employees and for many of those this would not have happened if Randstad would not have organized the program.
This approach is exactly what Porter calls creating shared values, it is about helping to solve the societal problems and at the same times finding the profitable way of business growth. See also this post about a great award for early-career researchers.
Unilever, TenCate, DSM, and Randstad have developed great sustainable solutions that benefit society and help their businesses grow in a durable way. I hope we will see more examples of creating shared values from many more modern companies.