Speaking at the World Economic Forum (WEF) on Africa, which took place in Durban earlier this month, WEF regional head for Africa, Elsie Kanza said: “Inclusive growth means a wholesale rethink of the way we celebrate national accomplishment. Gross domestic product was never meant to be an all-encompassing way of measuring an economy’s health: our obsession with it these days means we think about little else. It’s much better to assess progress in terms of how an economy is able to raise the standards of living of the people who drive its success. The good news is that this can be done in a variety of ways.”
While Kanza did not mention creating shared value in so many words, she certainly alluded to it. “The strongest economies in the world are those that see growth at their top line of gross domestic product and also their bottom line — the median income of its workers,” she said, elaborating on the WEF on Africa’s theme of inclusive growth and development.
“Indeed,” says head of shared value advisory at Genesis Analytics, Ryan Short, “Africa, and SA in particular, don’t just need growth, we need inclusive growth — and fast. Creating shared value provides a missing business framework for companies to start thinking about inclusive growth as part of their core business strategy. It is about innovation — doing business in a new way — using social needs as the lens to innovate.”
According to Short, Africa is a perfect laboratory for creating shared value. The continent has rapidly growing business markets in societies with many social needs and challenges, including youth unemployment and infrastructure gaps, which limit economic growth and human development. It faces challenges in health, food security, housing, education and digital connectivity.
“Shared value provides an important framework for turning socioeconomic deficits into good business,” says Short. “However, while it is already widely present in Africa, it is often known as ‘inclusive business’, and is driven by international aid and development agencies rather than companies. This has limited its impact.”
The good news, he adds, is that shared value can take the same idea and repackage it out of an aid/development concept to one that is attractive to the business community. Africa will benefit from shared value if companies take it to heart and into strategy, rather than limiting it to branding.
Short believes the Africa Shared Value Summit plays an important role in promoting the concept, and encouraging companies to understand how the business world is changing. It will also reveal opportunities that have already been created by “shared value first movers”, many of which are start-up social enterprises. And, says Short, it will highlight the urgency for more large companies to adopt a shared value approach to business.
He hopes the summit will help to drive the shared value agenda, formalise the concept, share best practice, build partnerships and inspire leaders with the prospect of combining new business ideas with meaningful social impact.
“Business as usual is over,” says Short. “We need our best corporate minds to start thinking about profitable innovation and ideas that simultaneously, deliberately and profitably solve the big social needs in Africa — whether in health, education, affordable housing, skills development, financial inclusion or youth employment.”
Article Source: Business Day