The winners of the blog contest Strategizing CSR – Creating Shared Value
# Suhail Haque, Senior Programme Manager – Livelihood
Innovative Financial Advisors Pvt. Ltd. – Strategizing CSR- Creating Shared Value
Innovative Financial Advisors Pvt. Ltd. believes that in many situations, strategy is synonymous with ‘important’. If you want something to be taken seriously, label it ‘strategic’. Having an action plan is all well and good, but a ‘strategic’ plan really has an impact! Actually, strategy is importance in practice.
How does a new idea or practice become strategic? How do actors make this happen? What are the consequences of this process? And what does the term ‘Creating Shared Value” mean?
It is a strategy for developing the future market while also strengthening economies, the market place, communities and the company coffers. CSV is a powerful concept that can prompt companies to think differently about their approach to social and environmental issues.
Although even cursory observations suggest that labelling a new idea or practice ‘strategic’ can provide it with legitimacy and thus facilitate its acceptance within an organization. Most agree that enterprises should protect and enhance the rights and interests of employees, consumers, creditors, communities, environment, government, and other stakeholders except shareholders as much as possible as they pursue and create profits for shareholders. From a view of strategic management, it is understood that stakeholders are individuals or groups that can affect or be affected by the implementation of corporate strategic aims. According to Marsden (1996), it is easier for enterprises with social responsibility to recruit new employees who sustain their loyalty to enterprises. CSR can benefit both the enterprise and the stakeholders and the society in the same way. As CSR can generate real interests for enterprises, especially the support for the main business, it can help to improve enterprises’ effects, what is helpful to improve corporate social responsibility (policy, progress) to a strategic level. CSR is the society’s hope for enterprises fulfilling their obligations. The society hopes enterprises should not only realize their missions in economy but also obey laws, follow ethics, and benefit public interests. Therefore, the complete CSR includes enterprises’ economic responsibility, legal responsibility, ethical responsibility and philanthropic responsibility. Businesses are capable of implementing responsible behaviours as they pursue their profit-making activities. Arguably, Innovative Financial Advisors Pvt. Ltd. understands that CSR can enhance a firm’s competitive advantage as it helps to build trust and reputation, as it increases sales, reduces the costs and minimises risk. Therefore, CSR may lead to synergistic value creation. Businesses can create shared value opportunities by reconceiving products and markets, by redefining productivity in the value chain and by enabling local cluster development. A shared value approach requires particular areas of focus within the businesses’ context (workplace) as well as looking after society’s interests (comprising the environment, marketplace and the community) for the firm’s self-interest. Of course, the enterprise’s performance must be continuously monitored and evaluated in terms of achieving the desired economic results. The efficient operational processes are aimed at adding value to the firm itself. Arguably, when an organisation does well, there would be more available jobs in the community, would address unemployment issues which would result in more tax contribution to authorities.
Suhail Haque – Innovative Financial Advisors Pvt. Ltd.
* The reason for the selection was: Quality of content and simplicity of the text.