There are four years between now and the Brazil Olympics in 2016, which is enough time to prototype and then scale at least 10 new social ventures with shared value potential…
I have talked a lot (below) about the need for business to shift from the current economic paradigm – corporate-consumer-capitalism – to one that seeks to create shared value through solving social/environmental/economic problems together with untapped ‘entrepreneurs’ or the new generations of ‘leaders’ in the communities that face them. I believe that global business, and in particular consumer brands, are a strong platform to enable this shared value approach because of their vast and sophisticated supply and value chains and their wide consumer reach. In this context, corporate-consumer business becomes a template to unlock value in others and share the benefits. There are, after all, a lot of people – and a lot of changemakers – on this planet.
There are increasing examples of this model framed as ‘Inclusive Business’, ‘Enterprise Development’ and ‘Hybrid Value Chain’. All of these approaches were on the basis of a blended value chain, enabling collaborative entrepreneurship and value to be shared between producer and consumer. But more evidence is needed. As global consumer businesses seek growth in emerging markets where planetary, social challenges and corrupt government is most felt, this new frontier of wealth creation needs to expand and be legitimised within the global economy.
In talks with the world’s largest consumer goods company this week in response to Paul Polman’s latest rhetoric on long-term growth in emerging markets, I suggested the need for an ‘academy’ for social business and shared value models. The ‘Shared Value Academy’ would be run and placed geographically in an area where there are social challenges to address and innovation and human potential to unlock. The objective would be produce a number of shared value businesses opportunities and prototype these in the communities, much like a ventures accelerator, possibly run from within a Favela. There are four years between now and the Brazil Olympics in 2016, which is enough time to prototype and then scale at least 10 new social ventures with shared value potential. A glimpse at the sponsor page for the London Olympics shows the amount of brand interest in this event and the potential to work on true legacy initiatives with four years worth of marketing value.
Acumen Fund, a successful social ventures organization, is a philanthropic venture capital fund according to Forbes’s recent piece on social business. Investor’s returns don’t go back into their pockets; instead all returns are reinvested in Acumen – progress is measured not in ROI but rather against the good that could have been done by simply giving the money away.
The Shared Value Academy would work with a different model but a similar ambition to Acumen, recognizing that its social venture capital is tied to profit-driven shareholders in the global brand. Investment returns would need to be ‘shared’, over time, to ensure long-term revenue streams for the branded business as well as prosperity for the community. But other ROI models will need to be conceived because as well as creating new revenue streams, shared value ventures will open new market opportunities and serve as powerful marketing tool for the brand.