‘Shared value’ Concept for Social Responsibility Catching on
OTTAWA—Harvard business guru Michael Porter’s concept of “shared value” is this year’s theme of an annual conference held in Ottawa connecting community and business leaders who share a passion for advancing social responsibility.
“What we find is that in the past the old CSR [corporate social responsibility] model of philanthropy is not the best way,” said Eli Fathi, chair and co-founder of the Corporate and Community Social Responsibility (CCSR) Conference—Canada’s largest—that will return to Ottawa’s Algonquin College on Nov. 15.
“The traditional method was, ‘I will make money. I’ll give you a little bit of it, and you go and spend it on a certain cause.’ The problem with this approach is that … my objectives are totally different from yours,” Fathi said.
He explained that the shared value model helps companies overcome this problem by aligning their objectives with those of the organizations they deal with, to advance both social and economic good.
For example, a coffee business might teach the farmer that it buys beans from how to farm better, prevent crop diseases, or how to roast the beans to make more money and increase their value in the food chain.
The idea is to find and grow the connections between societal and economic progress so that companies increase their profits and competitiveness and at the same time advance the economic and social conditions in their communities.
“It becomes a joint effort, as opposed to I give and you take,” Fathi said. “But rather, we are both working together to achieve common goals. That’s really the biggest activity and notion that has evolved over the past few years with corporate social responsibility.”
Key Role of Youth, Education
Fathi had a similarly inclusive perspective in mind when he first came up with the idea of the CCSR Conference in 2008.
The conference is not only unique in that it integrates both the community and corporate worlds; it also includes academia, youth, and government, addressing “all the population,” he said.
Its founding members are five academic institutions that include three universities and two colleges.
Fathi noted that education plays a key role.
“Given that the academic institution is all about teaching and bringing ideas to the youth, it would be a good idea to try to look at different areas than just the business aspect, but rather look at the social aspect, the environment aspect, the sustainability area,” he said.
‘Occupy Canada’ Survey
The Occupy Wall Street movement that has spread across the world is indeed telling companies they must not only practise social responsibility, they must also improve how they are perceived by their communities.
A survey conducted in October by Abacus Data, official pollster of the conference, found that Canadians highly agree with the Occupy Canada protesters’ arguments.
It reported that 81 percent of respondents agree that corporations and the rich have too much influence over public opinion and politics in Canada, and 81 percent agree the gap between the rich and poor has grown too large in Canada.
Moreover, 65 percent agree that Canadian financial institutions have been reckless and greedy, and 51 percent agree that most Canadian corporations are unethical.
And while 41 percent have a favourable impression of the Occupy protests, few believe they will have a positive impact on Canadian politics, the survey found.
‘Voting with Their Money’
The survey is the fifth of a six-part series conducted over the past year aimed at gaining a Canadian perspective on CCSR, since most of the data on this issue is either American or European. The series also studied ethical consumerism, ethical employment, and ethical investing.
“Not to our surprise, more or less, Canadians are in line with what you consider the socially responsible countries,” said Fathi.
The surveys show that “there is definitely a segment of the population—which is growing—that is very supportive of sustainability and social functions being done … [whether] it’s poverty, social housing, helping the poor and the weak,” said Fathi.
That segment is about 25–35 percent of Canadians, he said. “They’re willing to vote with their money … to make even more socially responsible initiatives and laws and policies come within companies.”
“It means that they are willing to take a cut in pay, they’re willing to pay more money in the restaurant if [the food] is locally grown, they’re willing to pay more for a product or service if they know that the company is ethical, and they would like to work for them.”
Carrot-and-Stick Approach Ineffective
While some advocate legislating CSR or providing incentives to encourage CSR, Fathi believes that such a carrot-and-stick approach would only drive companies to become “minimalists.”
For example, they will aim to achieve only up to the legislated emission standard, or will stop responsible practices as soon as the tax break is withdrawn.
“I really believe that the best approach is the ‘within’ approach—when you believe in it,” Fathi said.
“And that’s why the education side is so important, because if you believe in it, truly believe in it, then you will do it irrespective, because you know that it’s the right thing to do.”
Abacus/CCSR Conference ‘Occupy Canada’ Survey Highlights
Split feelings about the protests:
• 41 percent have a favourable impression, 22 percent a negative impression.
• 18 percent are neutral, 18 percent do not know enough to have an opinion.
• 81 percent of BQ supporters indicate a favourable impression, compared to 56 percent of NDP supporters and 26 percent of Conservative Party supporters.
Impact on Canadian politics:
• 18 percent believe the protests would have a positive impact, 59 percent said they would have no impact.
Gap between rich and poor in Canada versus U.S.:
• 43 percent said the gap was smaller, 36 percent said it was about equal, while 13 percent said it was larger.
High agreement with protest arguments:
• 81 percent agree corporations and the rich have too much influence over public opinion and politics in Canada.
• 81 percent agree the gap between the rich and poor has grown too large in Canada.
• 64 percent agree Canadian financial institutions have been reckless and greedy.
• 51 percent agree most Canadian corporations are unethical.
The Epoch Times is a sponsor of the Corporate and Community Social Responsibility Conference.