In this thesis the author strives to find out if the Shared Value approach will help to improve the sustainability of a company in comparison to the Corporate Social Responsibility approach significantly. First the Anglo-American approach, called Corporate Citizenship (CC), regarding its elements and supplemented by examples of companies, will be discussed.
Afterwards the European approach of CSR, will be analyzed based on the latest definition issued in 2011 by the European Commission. In the next chapter, the Shared Value approach by Porter and Kramer will be described.
Each concept will be substantiated by company examples. Finally, the CSV approach will be compared with the CSR approach. Thereby the author will show the improvements as well as the challenges a company faces if it introduces the CSV approach into its corporate strategy.
Table of Contents
1 INTRODUCTION
2 CORPORATE SOCIAL RESPONSIBILITY
2.1 CORPORATE CITIZENSHIP
2.1.1 Corporate Giving
2.1.2 Social Sponsorship
2.1.3 Cause-Related Marketing
2.1.4 Corporate Foundations
2.1.5 Corporate Volunteering
2.1.6 Social Commissioning
2.1.7 Public Private Partnership
2.1.8 Social Lobbying
2.1.9 Venture Philanthropy (VP)
2.2 CSR ACCORDING TO EUROPEAN STANDARDS
2.2.1 Definition
2.2.2 The Environment
2.2.3 Community Involvement and Development
2.2.4 Labor practices
2.2.5 Human Rights
2.2.6 Consumer Issues
2.2.7 Fair operating practices
2.2.8 Organizational Governance
3 CREATING SHARED VALUE
3.1.1 Development
3.1.2 Definition
3.1.3 Reconceiving Products and Markets
3.1.4 Redefining Productivity in the Value Chain: General Information
3.1.5 Enabling Local Cluster Development: General Information
4 COMPARISON OF CSR AND CSV APPROACHES
4.1 POSITIVE IMPACTS AND ADVANTAGES FOR THE COMPANY
4.1.1 Positive Impacts and Advantages for the Company in General
4.1.2 Positive Impacts and Advantages by Reconceiving Products and Markets
4.1.3 Positive Impacts and Advantages by Redefining Productivity in the Value Chain
4.1.4 Positive Impacts and Advantages by Enabling Local Cluster Development
4.2 POSITIVE IMPACTS AND ADVANTAGES FOR SOCIETY: IMPROVEMENT OF THE LIVING STANDARD
4.2.1 Fair Distribution of Profits
4.2.2 Development of New Clusters
4.2.3 CSV is More as a Guideline
4.2.4 Focus on Needs Instead of Sales Figures
4.3 POSITIVE IMPACTS AND ADVANTAGES FOR THE ENVIRONMENT
4.3.1 Responsible Use of Resources
4.3.2 Environmentally Friendly Creation of Value Chains
4.4 CHALLENGES AND DISADVANTAGES FOR THE COMPANY
4.4.1 Acceptance by Shareholders
4.4.2 Change in the Corporate Culture
4.4.3 Change in the Remuneration System
4.4.4 Resistance to Change
4.4.5 Modifications in the Hiring Process
4.4.6 Laws and Regulation
4.4.7 Local Conditions
4.4.8 Uneconomical Business
5 CONCLUSION
Research Objectives and Themes
The primary objective of this thesis is to examine whether the "Creating Shared Value" (CSV) approach significantly improves a company's sustainability compared to the traditional "Corporate Social Responsibility" (CSR) approach, particularly by integrating societal and environmental needs into the core corporate strategy.
- Comparison of Anglo-American Corporate Citizenship (CC) and European CSR frameworks.
- Evaluation of the Shared Value concept as defined by Porter and Kramer.
- Analysis of practical company examples regarding social impact and value creation.
- Identification of improvements and challenges faced when transitioning to a CSV-based strategy.
Excerpt from the Book
3.1.2 Definition
Porter and Kramer define the management strategy concept as follows:
[The creation of] Shared Value can be defined as policies and operating practices that enhance the competitiveness of a company while simultaneously advancing the economic and social conditions in the communities in which it operates. The concept rests on the premise that both economic and social progress must be addressed using value principles. Value is defined as benefits relative to costs, not just benefits alone. Value is defined as benefit relative to costs, not just benefits alone.
Thus, the companies have to identify social problems and address the issues with their products and services. They therefore have to adapt the Shared Value Mindset derived from the CSD concept. With the Share Value Mindset the company sets the sustainable value creation at the core of the company’s vision and mission.
Summary of Chapters
1 INTRODUCTION: This chapter highlights the emergence of corporate scandals and environmental disasters, establishing the need for more effective sustainability strategies beyond traditional CSR.
2 CORPORATE SOCIAL RESPONSIBILITY: This section details the instruments and definitions of Corporate Citizenship and European CSR standards, supported by various industry examples.
3 CREATING SHARED VALUE: This chapter introduces the CSV concept, explaining its development and its three core ways to create value through products, value chains, and local clusters.
4 COMPARISON OF CSR AND CSV APPROACHES: This analytical section contrasts CSR and CSV regarding their impact on company performance, societal well-being, and the environment, while outlining the implementation challenges.
5 CONCLUSION: The final chapter summarizes that CSV offers a superior framework for sustainable business growth and recommends a strategic mix of CSV and CSR to achieve a truly sustainable economy.
Keywords
Corporate Social Responsibility, Creating Shared Value, Corporate Citizenship, Sustainability, Value Chain, Porter and Kramer, Social Impact, Stakeholder Dialogue, Environmental Responsibility, Business Ethics, Profit Maximization, Sustainable Growth, Local Clusters, Corporate Culture, ISO 26000.
Frequently Asked Questions
What is the core focus of this thesis?
The thesis explores the fundamental differences between Corporate Social Responsibility (CSR) and the Creating Shared Value (CSV) strategy, aiming to determine if CSV is a more effective approach for sustainable corporate success.
Which key frameworks are discussed?
The work examines Anglo-American Corporate Citizenship, European CSR standards according to the European Commission, and the Creating Shared Value model by Porter and Kramer.
What is the primary goal of the author?
The goal is to analyze whether shifting sustainability from a side topic to the core corporate strategy (via CSV) leads to a significant improvement in a company's sustainability performance.
Which scientific methodology is applied?
The thesis utilizes a qualitative approach, analyzing theoretical concepts and comparing them through concrete, real-world company case studies.
What topics are covered in the main body?
The main body treats the instruments of Corporate Citizenship, the ISO 26000 standards, the mechanisms of CSV (products, value chain, clusters), and a comparative evaluation of the benefits and challenges of both approaches.
Which keywords define this work?
Key terms include Corporate Social Responsibility, Creating Shared Value, Sustainability, Stakeholder Engagement, and Value Chain Management.
How does CSV differ from traditional CSR regarding business strategy?
While CSR often addresses social issues as a peripheral strategy (often linked to marketing), CSV integrates these issues directly into the core business model to enhance competitiveness and social welfare simultaneously.
What are the identified challenges for companies adopting the CSV strategy?
Companies face difficulties such as shareholder resistance, the need for significant cultural change, restructuring of remuneration systems, and the requirement for long-term strategic adjustments.
- Quote paper
- Andreas Graf (Author), 2016, Which improvements arise with the adaption of Creating Shared Value into the core strategy compared to the use of Corporate Social Responsibility, Munich, GRIN Verlag, https://www.grin.com/document/338724
