This document discusses creating shared value and identifying shared value gamechangers. It begins by explaining the motivation for studying shared value impact and looking for gamechangers. It then defines creating shared value as making a profit while delivering a social need. The document discusses why shared value gamechangers that fundamentally change an industry should be identified. It proposes developing a framework to assess the impact of shared value initiatives on firms and society. Finally, it reviews literature on shared value and shared measurement to develop such a framework.
1. Creating Shared Value Impact:
What Makes a Shared Value Gamechanger?
Research Work in Progress
at CamEd Business School, Phnom Penh, Cambodia
Ken Charman
CamEd Business School
TCI / MOC Asian Chapter Conference: 02 July 2021
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3. Creating Shared Value Impact: What Makes a Shared Value Gamechanger?
What’s the Motivation?
A personal view based on the Porter & Kramer (2011) Concept:
• Business needs and societies’ needs must converge
• Business (and microeconomics) is all about incentives
• Shared value is distinct from other forms of social enterprise
• it is the only one with absolute limitless incentives to make profits and address
social needs
• (so all incentives are in the same direction)
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4. Creating Shared Value Impact: What Makes a Gamechanger?
What is Creating Shared Value?
Creating Shared Value is:
• Making a profit whilst simultaneously delivering a social need (Porter and Kramer 2011)
Examples:
• Access to basic products & services (e.g. a bank account, healthcare) in remote areas
• More affordable healthcare (and health insurance)
• Improved opportunities in the agricultural industry to retain the workforce
• Improved opportunities for lower paid work (e.g. hotels and tourism)
• Energy saving and improved environment (especially water)
• New skills for the workforce (e.g. basic banking,, construction, logistics, plumbing)
• Better access to energy, solar power, internet (e.g. ENEL) 4
5. Creating Shared Value Impact: What Makes a Gamechanger?
Why Should we Look for Shared Value Gamechangers?
• Once in a while a business idea comes along for which there is:
• A vision and an intention to improve the wellbeing of society
• An innovation to address a social need
• Effective demand (so there is no redistribution – the social need is met by the
business)
• Returns (profits) above the industry standard (due to the effective demand)
• It changes the way that the industry sector works
• It becomes the ‘new normal’
• This is a ‘shared value gamechanger’
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6. Creating Shared Value Impact: What Makes a Gamechanger?
Why Should we Look for Shared Value Gamechangers?
Vision
Intention
Innovation
To Address a Social
Need
Target Market
(the underserved)
CVP
Effective Demand
Potential Profit
New Products and
Services
New resources
New competences
New Collaboration
Marginal
Initiatives
Sustainable
Practices
Gamechanger
Innovations
Platform for Growth
Further Innovation
Serving the
Underserved
A New Normal
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Strategy to Address
a Social Need
Target Market &
Business Model
Build Resources
& Capabilities
Impact for the Firm
and for Society
Result for the Firm
and for Society
Strategy to Deliver Shared Value
Impact for the firm and for society depends on:
The size of the market
Serving Basic Needs
Ability to Deliver Those Needs
7. Creating Shared Value Impact: What Makes a Gamechanger?
Developing a Framework to Assess the Impact of Shared Value
My target is to develop a framework which can be used to measure the impact of
shared value for the company, the sector, (the cluster) and the social needs
It should be something companies can understand and use
This is progress to date!
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9. Creating Shared Value Impact: What Makes a Shared-Value Gamechanger?
Guiding Light: Literature Review
Dembek, K., Singh, P., & Bhakoo, V. (2016). Literature Review of Shared Value: A
Theoretical Concept or a Management Buzzword? Journal of Business Ethics, 137(2),
231-267.
Dembek et al (2016)
• There is no consistent definition of shared value and no consistent measurement
• (so it is difficult to distinguish shared value from any other form of socially oriented business)
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10. Creating Shared Value: What Makes a Shared-Value Gamechanger?
Guiding Light: Literature Review
• Porter, M. E., & Kramer, M. R. (2006). Strategy and society: The link between
competitive advantage and corporate social responsibility. Harvard Business Review,
84(12), 78-92.
• Porter, M. E., & Kramer, M. R. (2011). Creating shared value. Harvard Business Review,
89(1/2), 62-77.
Porter & Kramer (2011)
• Level 1: CSV Products and services need a Customer Value Proposition (CVP):
• Level 2: CSV in the value chain (building competences and resources, less waste)
• Level 3: CSV Enabling cluster collaboration and development
My view: it is the cluster (Level 3) which links the firm level and the societal level
shared value
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11. Creating Shared Value: What Makes a Shared-Value Gamechanger?
Guiding Light: Literature Review
Kramer, M. R., & Pfitzer M.W., (2016). The Ecosystem of Shared Value. Harvard Business
Review…….
Kramer and Pfitzer (2016)
• The ‘ecosystem’ is the way that private companies, NGOs, community members
and governments all have a role to play and should work together to address the
social problems which are so immense, under the concept of ‘Collective Impact’
• There are too many competitive free-riders
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12. The Research Problem
There is No Framework to Measure the Impact of Shared Value
There never was one!
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13. Creating Shared Value: What Makes a Shared-Value Gamechanger?
Guiding Light: Literature Review Conclusion
Main conclusions of the literature review by Dembek 2015)
• No agreement on definition
• No agreement on measures
• No clear distinction between social enterprise and shared value and other forms of society friendly business
I would add
• No framework that makes a business friendly assessment
• No framework that actually measures intention (a priori) and impact (ex post)
Porter and Kramer (et al) have already identified the parameters to define and measure shared
value
We need to go back to Porter and Kramer’s original intentions to see if the original parameters
of shared value can be used to create a useable framework to measure shared value 13
15. Creating Shared Value: What Makes a Shared-Value Gamechanger?
How do we build a Framework to assess shared value impact?
Assess the components of shared value (Porter and Kramer 2011)
1) What is the intention to create shared value?
2) What might we expect to see (for the company and for society) if it
is successful?
3) How might we measure progress (impact)
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16. Creating Shared Value: What Makes a Shared-Value Gamechanger?
Firm Level Shared Value
How can we measure shared value from the Company’s and Sector’s perspective?
• Level 1: Products and Services
• Market size and profitability (local economy, national, global) (marginal, sustainable, supernormal)?
• Innovation impact (delivering a social need in a new way)
• Reputation Platform (what further opportunities can result?)
• Level 2: Value Chain
• Cost and waste reduction
• Resources building
• Competences and skills building
• Level 3: Cluster
• Local economy building
• Cluster and institutional collaboration (does it get more companies and institutions involved)?
• Spillover potential (to other related sectors)
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17. How might we measure ‘firm level’ shared value impact?
Private Sector Benefit Indicator Source Value
Creating Shared Value (Level 1): New Needs, Products and Customers
Market Size and Profitability No. Customers / people benefitting Sales data
Innovation Impact A new way to deliver a social need? No similar products of services available
Reputation Platform Does innovation create new opportunity New businesses spun-off as a result of the
innovation
Contribution to Value Chain Improvement (Level 2)
Reducing Cost & Waste in the
Value Chain
Areas and quantities of savings (how much and
where they occur)
Company reports and accounts
Building Value Chain Resources Resources created manufacturing / logistics New Infrastructure in value chain
Building Skills and Competences New skills/competences, abilities New skills directly related to innovation
Contribution to Cluster Development and Collaboration (Level 3)
Cluster Building New cluster activity/suppliers/local economy New business activity / local skills
Cluster & Institutional
Collaboration
New collaboration/institutional support? Interviews with cluster members
Spill-over Potential Opportunities for related spill-overs? Interviews with cluster members 17
18. How might we measure ‘societal’ shared value impact?
Social Needs
From CSV Concepts Presentation: From the Social Progress Index
Energy Efficiency Basic Human Needs: Nutrition & Basic Medical Care
Environmental Improvement Water and Sanitation
Water Use Shelter
Jobs for Low Paid Workers Personal Safety
Economic Development Foundations of Wellbeing: Access to Basic Knowledge
Affordable Housing Access to Information & Communications
Workforce Skills Health and Wellness
Health Environmental Quality
Worker Safety Opportunity: Personal Rights
Education Personal Freedom and Choice
Inclusiveness
Access to Advanced Education
You may add other sources / areas (be creative) 18
19. Creating Shared Value: What Makes a Gamechanger?
Social Needs Impact
How can we measure shared value from the Social Needs perspective?
1. Quality economic activity (including public policy impact)
2. Education and Workforce skills
3. Health and Safety
4. Social Progress (basic needs, wellbeing and opportunity)
5. Improving the Environment
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20. How might we measure ‘societal-level’ shared value impact? (1 of 2)
Societal Benefit Indicator Source Value
Quality Economic Activity
Economic development Is there an increase in economic activity? Employment (especially for lower income) and
output data
Jobs for low-income
citizens
Have new sustainable jobs been created? Employment data, skills developed
Flourishing Local Economy Local economic activity / Infrastructure Employment data / affordable infrastructure
Education and Skills
Education (school) Improved availability of affordable
education
Number and quality of schools (e.g. PISA)
Education (adult, college,
university)
Improved take-up of college or university Enrolment at university / college
Workforce skills Increased professional and vocational
skills
Numbers trained in vocational skills
Health and Safety
Health improvement of
population
Is there a general improvement in health (e.g.) Rates of obesity and chronic diseases
Specific medical needs
addressed
Improvement in targeted medial need (e.g. no. of women fatalities in childbirth)
Worker safety improved Increased safety standards at
work/transport
e.g. no. road accidents, or accidents at work 20
21. How might we measure societal level shared value impact? (2 of 2)
Social Benefit Indicator Source Value
Environmental Improvement
Energy Efficiency Has energy efficiency improved? Energy usage data
Environmental
improvement
Have environmental conditions improved e.g. pollution levels
Water use Has there been a decrease in water use Water consumption data by industry
Contribution to Social Progress
Fulfilling Basic Needs Does it assist in fulling basic needs? Numbers of homeless?
Improving Wellbeing Does it contribute to improving wellbeing? e.g. Access to education (school
enrolment)
Creating Opportunities Does it contribute to creating opportunities for
the population? Are people happier?
Interviews
Contribution to Public Sector: Resources Saved & Policy Objectives Achieved
Public Resources Saved Does it directly save public funds? Public policy data
Public Resources Freed-up Does it free public resources? Public policy data
Public Policy Achieved Contribute to public policy objectives? Government initiatives based on this
approach
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22. Are you Really Creating Shared
Value……..and where?
Marginal, Sustainable and Gamechanger
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23. Are You Really Creating Shared Value?
Category Box
No Impact -
Marginal
Positive value to the company (cannot make a loss)
Positive value to addressing a social need
A platform for future opportunities (i.e. it is worth it but not for profit alone)
Sustainable
Identifiable and sustainable effective demand and is profitable
Sustainably addresses a social need in addition to previous best practice
Builds new resources, skills, competences or involve significant cluster collaboration
Gamechanger
(potential
disruptor)
Differentiates the company’s product / service differentiation for products and services
Has greater profitable returns that previous business?
Other companies buy / take on your product or service?
Can fundamentally change the way that a social need is addressed?
Can measurably improve people’s lives?
Have public authorities use your services to address social needs (e.g. UK government
now paying people to stay fit)
Does it have the potential to become the ‘new normal’?
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24. Example: Discovery Limited (Health Insurance)
Short Term Incentives to Encourage People to Make Better Long Term Decisions
Firm Level Shared Value Impact
Intended shared Value Intended Impact on Social Need Marginal Sustainable Gamechanger
The Shared Value Intention To make people healthier
The Innovation / Business Model Short term incentives to change long term behaviour
The Target Market Niche population / Underserved population / key driver
Contribution to Competitive Advantage Indicator of Achievement ☺
New Needs, Products & Customers (L1) Innovation, new customers, delivery of social need ☺
Effective Demand (Customer value proposition) Proven demand and CVP ☺
Competitive advantage / niche Sustainability of niche ☺
Market Size potential Revenue & Profit Potential Local, national, international potential ☺
Innovation Impact Potential new way to deliver a social need? ☺
Virtuous Circle Effect Potential to be used in more than one market ☺
Value Chain Improvement (L2) Value added in value chain / supply chain ☺
Resource Building Resources, (manufacturing, distribution etc.) ☺
Competence & Skills Building New skills and competences ☺
Reputation Platform Reputation effect leads to more opportunities ☺
Cluster Development & Collaboration (L3) Thriving interactive clusters ☺
Local Economy Building? Increase in local suppliers, building skills locally ☺
Cluster & Institutional Collaboration Increased collaboration with institutions and cluster ☺
Spill-over Potential opportunities Spill-overs to other sectors ☺
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25. Example: Discovery Limited (Health Insurance)
Short Term Incentives to Encourage People to Make Better Long Term Decisions
Societal Level Shared Value Impact
Intended shared Value Intended Impact on Social Need Marginal Sustainable Gamechanger
The Shared Value Intention To make people healthier
The Innovation / Business Model Short term incentives to change long term behaviour
The Target Market Niche population / Underserved population / key driver
Quality Economic Activity Local Economic Development to Benefit All ☺
ncreased Affordable Housing Increased stock of affordable homes ☺
mproved Worker safety standards Improved worker safety standards ☺
ncreased Sector Activity ☺ ☺
ncreased Economic Activity ☺ ☺
ncrease in Jobs for low-income citizens Increase in hobs for low-income citizens ☺
Demonstrable Flourishing Local Economy Numbers of people benefitting ☺
Human Capital Healthier, More Educated & Happier Population ☺
mproved Health Improved healthy population ☺
mproved Workforce Skills Increased skills in workforce ☺
mproved Education Increase in educated population ☺
mproved Wellbeing Safer, happier population + opportunities ☺
Environment More Sustainable Use of Natural Resources ☺
Environmental Improvement Measurable Improvement in the environment ☺
mproved Energy Efficiency More efficient use of energy or use of green energy ☺
More Efficient Water Use Measured Increase in Water Available ☺ 25
26. Source
(Case Study)
Intended Shared Value
(Social Need Addressed)
New Needs,
Products &
Customers
(Level 1)
Contribution to
Value Chain
Improvement
(Level 2)
Contribution to
Cluster
Development &
Collaboration
(Level 3)
Contribution to Social
Need
Rows = intended shared
value
Columns = Impact
Market
Size
Innovation
Impact
Revenue
&
Profit
Resource
Building
Competence
&
Skills
Building
Reputation
Platform
Local
Economy
Building
Cluster
&
Institutional
Collaboration
Spill-over
Potential
Quality
Economic
Activity
Education
Health
Wellbeing
Environment
Intercorp Services and products
Peru’s underserved
Local skills and local
economy development
Access platform to remote
areas
Discovery Making people healthier
Provide short term
incentives……
Reduce long term costs of
health insurance
Short term incentives for
long term benefit
Shared Value:
Contribution
to Private
Sector and
Public Sector
and Wellbeing
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Gamechanger
(Blue)
Sustainable
(Dark green)
Marginal
(Light green)
27. Shared Value: Contribution to Private Sector and Social Needs
Source
(Case
Study)
Intended Shared Value
(Social Need Addressed)
New Needs, Products
& Customers
(Level 1)
Contribution to Value
Chain Improvement
(Level 2)
Contribution to Cluster
Development & Collaboration
(Level 3)
Contribution to Social Need
Rows = Intended Shared Value
Columns = Shared Value Impact
Market
Size
Profitability
Innovation
Impact
Reputation
Platform
Resource
Building
Competence
&
Skills
Building
Reputation
Platform
Local
Economy
Building
Cluster
&
Institutional
Collaboration
Spill-over
Potential
Quality
Economic
Activity
Education
&
Skills
Health
Social
Progress
Environment
Improvement
Intercorp
Services and products Peru’s underserved
Local skills and local economy development
Access platform to remote areas
Discovery
Making people healthier
Reduce long term costs of health insurance
Short term incentives for long term benefit
Walmart
Employment for the underserved
Environmental improvement in emission
Sustainable food supplies at low prices
Nestle
Health and wellbeing consumer products
Local economy for coffee suppliers
Move for consumers away from sugar
Dow
Canola Oil
Desalination
Adhesives for cars
Novartis
Education in healthy families in India
Access platform to remote access
Collaboration with health authority
CVS Health
Complements the health services (free-up)
Health service available close to consumers
Innovative health products for consumers
Beckton
Dickinson
Public health objectives facilitated
New products available for consumers
Access platform for remote areas of world
Yara Inter-
national.
Improved agricultural output in Tanzania
Infrastructure in Tanzania
Cluster collaboration in agriculture
ENEL
Switch to renewable resource electricity
Consumers meter readings digital (platform)
Incentives for consumers for solar power
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28. Creating Shared Value Impact: What Makes a Shared Value Gamechanger?
Conclusion
• Measuring Shared Value is in its infancy
• No framework exists to assess the shared value for the company and society
• Measuring shared Value is an Iterative Process
• This is my attempt to provide a workable framework which can used by
business and business schools
• It has the added advantage that companies can assess easily where they are
adding shared value and can potentially re-direct resources for bigger shared
value impact
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30. A Survey of Shared Value
Initiatives in Cambodia
Completed by CamEd Business School Students for their Assignment
(November 2020 and May 2021)
Based on the Framework
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31. Creating Shared Value: What Makes a Shared-Value Gamechanger?
Research Work in Progress (Cambodia) The Questionnaire
What Questions did we ask:
• Company background
• Shared value intentions
• Did you plan to exploit unserved market (if so which)?
• Did you intend to address a social need
• Did you intend to replace a public service
• What is the impact of your shared value strategy?
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32. Creating Shared Value in Cambodia
The draft Framework Methodology (First Draft)
Company Social Need
Intention
Company
Impact
Social Need
Impact
Public Policy
Impact
Wellbeing
Impact
Company 1 Social Need A 1 1 3 3
Social Need B 2 0 2 2
Social Need C 2 1 2 1
Company 2 Social Need A 3 1 1 3
Social Need B 3 2 0 2
Social Need C 4 2 0 0
Company 3 Social Need A 5 1 1 1
Social Need B 2 2 4 0
Social Need C 3 2 3 2
Company ‘n’ “
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34. Creating Shared Value in Cambodia
Survey Respondents: Industry Sector
(39 Responses)
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35. Creating Shared
Value in Cambodia
Survey
Respondents:
Industry Sector
(39 Responses)
(1 of 2)
Sector No Examples include: (brief description)
Construction / Repair 4 Supplies for repairing roads (asphalt, road safety signs)
Producer of hollow and solid bricks
Construction materials
Auto repairs
Manufacturers
(including recycling)
4 Producer of Cotton and Paper Bags
Sells clean water to residents of region in Cambodia
Paper and packaging company with waste-paper
Environmentally friendly char-briquettes: recycled biomass
waste
Drinks and Food
Manufacture
Instant noodles
Sugar juice (food and drinks manufacturer)
Beer producer and retailer
Banking and Finance 5 E-banking, Banking and finance, Life assurance
Trade / Wholesale Import and export company
E-commerce platform connecting buyers and sellers
Sells refrigerator, air conditioners
Other Retail 2 Diamond jewellery retailer
Natural and ethical beauty brands 35
36. Creating Shared
Value in
Cambodia
Survey
Respondents:
Industry Sector
(39 Responses)
(2 of 2)
Sector No. Examples include: (brief description)
Coffee Shops and
Food Retail
7 Coffee franchise
Tea and coffee shops
Mobile food delivery
Restaurant
Serves drinks and food, snacks, and meeting rooms
Other Retail 2 Diamond jewellery retailer
Natural and ethical beauty brands
Travel (Regions) 2 Homestay living with local people in rice fields village
Travel information and reservations
Healthcare 2 Clinic and pharmacy for people in the neighbourhoods
Clinic providing healthcare
Education 2 Education institute
University
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38. Creating Shared Value in Cambodia
Survey Respondents: Location of Customers
‘Other’: Total 22 Responses, of which:
5 Only one or two provinces in Cambodia
15 target customers in multiple regions of
Cambodia
1 exporter to China, 1 to Japan
1 exporter to Thailand, 1 to SE Asia
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41. Creating Shared Value in Cambodia
Section 2
Survey Respondents: Shared Value Business
intentions & Targets
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42. Creating Shared Value in Cambodia
survey Respondents: target customers
Responses include several who
target a range of incomes, and
some business-to-business
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43. Creating Shared Value in Cambodia
Question: Are you Serving a new (underserved) market?
Several state that they are using new
approaches and creating new markets (e.g.):
• Supplying clean water in a rural area
• New kinds of drinks (e.g. bubble tea)
• New E-commerce platforms
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44. Creating Shared Value in Cambodia
Question: Are you Creating and innovation,
or new way of serving customers?
The many examples include:
New packaging material
New noodles / food production / recipes
New digital products
New recreational styles / lifestyle
New financial services
New ways of ordering products
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45. Creating Shared Value in Cambodia
Question: Is there a social need that you are
specifically looking to address?
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46. Creating Shared Value in Cambodia
Question: Is there a social need that you are
specifically looking to address?
• “……health and wellbeing …….. life plan…….trying their best to make
it more and more accessible to people with lower level of wealth”
• “…… nutrition. It aims to provide healthy and fresh…… drink for people
who concerns about their health.”
• “……education, improvement in quality of life through development and
encouragement of house ownership and entrepreneurship.”
• “…….. The (cosmetics) shop satisfies safety needs for consumers,
while its production has positive impacts on environment, and job
availability for poor people”
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47. Creating Shared Value in Cambodia
Question: Do you think your company will
benefit your local community?
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48. Creating Shared Value in Cambodia
Question: Do you think you company will
benefit your local community?
Some open-ended comments from respondents
• “The company creates 182 job opportunities to the community.”
• “People will get more deeply understanding about illness and know
how to protect themselves and could also decrease spending on
unnecessarily medicines that could affect to them.”
• “The company recycles used road facilities so they reduce the waste
of product consumption.”
• “Since the shop is supporting the farmer and help with their training in growing vegetable. The
shop will also support the community by buying organic vegetable to use in their shop as
ingredient for the food.”
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50. Creating Shared Value in Cambodia
Section 3
What is the Impact of Your Shared Value Approach?
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51. Creating Shared Value in Cambodia
Question: Are you building competences and skills
for your business and workforce?
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52. Creating Shared Value in Cambodia
Question: Are you building competences and skills
for your business and workforce?
Some open-ended comments from respondents
• “Soft skills / Communication skills / a service mindset”
• “Digital skills”
• “The type of new competences and skills that is not familiar for workers in
Cambodia. Because not many factories that used waste to produce the
cotton paper in Cambodia.”
• “sharing knowledge and consult to local people about the health care”
• “serving in the shop will help them improve their communication and barista
skills.”
• “Accounting and finance skills”
• “Service mindset, Technical skills”
• “Retail banking skills”
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53. Creating Shared Value in Cambodia
Question: Do you consider that you are contributing
to a growing local economy?
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54. Creating Shared Value in Cambodia
Question: Do you consider that you are contributing
to a growing local economy?
• “It is a long term business where the owner wants the village people
to grow together with the business.”
• “The company provides employment to local people.”
• “provide job opportunities”
• “result in pension, health care expenditures, education
expenditures.”
• “Culture awareness => Economy by foreign visitors, Increase
people’s working lives”
• “The local economy benefits from the factory is collecting tax and
contributing the total export in the country.”
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55. Creating Shared Value in Cambodia
Question: Do you consider that your business is
freeing-up public sector resources in any way?
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56. Creating Shared Value in Cambodia
Question: Do you consider that your business is
contributing to any of the following public policy objectives?
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57. Creating Shared Value in Cambodia
What can we conclude and next steps?
• From the literature:
• Creating shared value has emerged from a multitude of sources
• Creating shared value sits along a spectrum with CSR and Philanthropy
• From measurement of shared value to date:
• Some very good work, but still no accepted framework for measuring shared value
• From our survey (we focus on impact, however this can be measured):
• Cambodia companies are creating shared value
• Shared value is a little indefinable, but you know when it is there
• Patterns emerge
• Next steps:
• Combine framework and survey data
• Measure non-monetary indicators too
• Build local case studies (using this as a template)
• Share surveys with creating shared value community
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58. Creating Shared Value in Cambodia
Thank you MOC ASIAN CHAPTER!!
THANK YOU to CamEd STUDENTS!!
THANK YOU TO RESPONDENTS!
This survey has provided a wealth of information on the intentions of businesses to
create shared value and on the impact of the shared value being created.
A massive thankyou to everyone who has taken part in the survey.
We will provide a summary of the results as soon as we possibly can (during
November / December 2020)
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