The innovative business practice of shared value, whereby profit-driven entities undertake social and environmental missions, naturally prompts contemplation of the possibility of legitimate coexistence of such normally divergent positions. Any such discussion is especially significant today as we celebrate the 45th anniversary of Earth Day, a day set aside by more than 192 countries and 22,000 partners to “activate the environmental movement worldwide, through a combination of education, public policy, and consumer campaigns.”
While the subjects of the environment, climate change and sustainability increase their foothold in all aspects of daily living globally, at first sight one cannot help but ponder the sincerity of many major corporations’ voiced commitment to seek solutions to social and environmental dilemmas. This is particularly true in light of the fact that so many current environmental and social problems can be traced directly to bad business practices that destroy the environment but increase the bottom lines of these entities. Such practices include, but are not limited to:
- Industrial pollution of air, land and water;
- Depletion of natural resources.
- Employment of unfair labor practices which result in economic and social consequences detrimental to employees.
The reality is that while the majority of support for environmental protection and sustainability largely has stemmed from a nonprofit grassroots approach, this movement has evolved naturally to become a global concern that features the implementation of innovative products and services that provide solutions to problems while simultaneously allowing the designers the opportunity to earn a living. The impact of education and technology cannot be underestimated as colleges and universities offer curricula to design and develop products of daily living that are energy-efficient and environmentally friendly. Additionally, academia and government closely monitor the impact of our activities of daily living on our health and wellbeing, thereby increasing awareness of the need to be mindful of sustainable living.
Corporate participation in shared value projects serves as validation of the strength of shareholders in public businesses and the importance of the consumer in the development of products and services. The consistent and persistent demand for transparency in the boardroom and accountability in the delivery of products and services contribute to a healthier environment and a safer world. We now see a stock market that boasts significant economic gain from investment in green commodities, i.e., solar and clean energy exchange traded funds.
The many faces of shared value
Of course, strict oversight of any shared value programs remain a necessity. We see companies like Nestles, Dow Chemical and even Bain Capital tout shared value programs. We know of past and present infringements by many of these companies with depletion of natural resources, environmental damage and employee abuse. Hopefully, the power of the shareholders, combined with strong consumer insistence on sustainability, will help to keep companies in line as they pursue social entrepreneurship. Add to that the new faces on the shared value side of these businesses, such as Deval Patrick, former governor of Massachusetts, who just accepted a position with Bain Capital to lead its social mission program.
The goal of shared value projects is to make a profit while solving a problem. The marriage of profit-driven businesses aligned with the conscious of nonprofit businesses could mean endless possibilities. On this Earth Day 2015, we welcome social entrepreneurs to our army of stewards of the Earth.
HAPPY EARTH DAY. LIVE GREEN, BE GREEN!