Tuesday, May 18, 2010

Agents of social progress

Agents of social progress 
By Dinna Chan Vasquez
Manila Standard Today, Lifestyle
May 18, 2010

Can corporations sustain growth for their businesses and still be catalysts for social progress?

This was the question raised by the first Creating Shared Value Forum, which gathered leaders in the field of business, government, non-government organizations, bilateral and multilateral aid agencies, the academe and social and charitable institutions.

The forum was organized by Nestle Philippines Inc. in cooperation with Asian Development Bank, Asian Institute of Management and Philippine Business for Social Progress. One of the goals of the forum, according to organizers, is to encourage the business community to transition current corporate social responsibility projects to corporate shared value.

Edith de Leon, Nestlé Philippines senior vice president and head of corporate communications, said Nestlé organized the event in order to share its business philosophy that has been in place since the company was founded almost 140 years ago.

“Nestlé has been creating shared value long before the term CSV was coined. It is a philosophy that informs all its business decisions. In the Philippines, for instance, Nestlé is supporting the livelihood of some 30,000 small Filipino farmers and their families through the Nestlé Experimental and Demonstration Farm in Davao,” she added.

During the forum, Antonio Meloto, chairman of Gawad Kalinga, stressed the need for a visible participative transformation to address poverty and its ills, including crime, illiteracy and violence.

Maria Capanzana, director of the Food and Nutrition Research Council, spoke on the importance of nutrition and healthy food. She cited the importance of having a good diet as opposed to a “junk diet” composed of food that is not of good quality and is unacceptable.

Arjun Thapan, special senior adviser to the president on infrastructure and water of Asian Development Bank, said there was a need to have a unified law that would set the standards for water management.

“Use less and return what you use,” was Thapan’s answer when asked how people could help conserve the planet’s water resources.

Mark Kramer, who is considered the world’s leading proponent of creating shared value and the founder and managing director of FSB Social Impact Advisers, said the core idea behind CSV is symbiosis, a term originally used in the biological sciences to refer to a mutually beneficial relationship between two living organisms. The relationship, Kramer explained, exists to ensure the survival and growth of both organisms.

Kramer explained that CSV is more expansive, more precise and more integrated approach in its approach toward achieving a mutually beneficial relationship between business and society.

“CSV allows a corporation to integrate social responsibility and progress within the core of its values, business strategy and processes,” he said.

As an example, Kramer cited how Nestle teams up with local farmers in its business operations, resulting in mutual benefits.

According to Meloto, Gawad Kalinga has a five-year partnership with Nestle that started in Baseco.

“This transformed the lives of 5,000 people,” Meloto added.

The World Economic Forum Annual meeting in Davos, Switzerland early this year brought together leaders from governments, business, civil society, academia and media to discuss the most pressing issues facing the world. Among the business leaders who attended the forum were Nestle officials who shared their ideas in the forum’s “Global Industry Outlook: Health, Consumers, Tech and Travel” session.

Nestle chief executive Paul Bulcke outlined Nestlé’s concept of Creating Shared Value and the positive role of business on society.

He said, when value is created and shared, people’s sense of responsibility, of ownership and stewardship increases.

Kramer, a Harvard senior fellow, said a company must create social programs consistent with the same core frameworks it uses to run its businesses.

In his award winning study “Strategy and Society: The Link between Competitive Advantage and Corporate Social Responsibility” published in the Harvard Business Review, Kramer and co-author Michael Porter, also a Harvard professor, cited how Nestle works with local farmers for the manufacturing of its food products.

The study pointed out that Nestle benefits as a company by taking care of the welfare of small farmers. This is the approach used by Nestle in the Philippines as it works with small coffee farmers.