With increasing investor, customer, and societal activism, most companies these days have already established some form of Corporate Social Responsibility (CSR) as a means to articulate purpose. Most CSR initiatives find their roots in philanthropy, and companies also give employee time as a means to engage with the community, develop bonds among corporate volunteers, and grow leadership among young staffers in low-risk settings.

Traditional CSR efforts will however always be hampered by shareholders who don’t believe in freely giving company assets away. We see an opportunity to break this trade-off in Shared Value companies, where corporations use Socially Innovations to generate direct returns from doing social good. Here are some ways that we have found helpful to better articulate the value of CSR activities:

LICENSES TO OPERATE & COST SAVINGS

• New sources of talent were successfully released when Microsoft trains coders in developing countries or when MacDonald’s  plans its infrastructure to accommodate elder workers
• Sustaining the workforce, such as in the corporate universities and townships set up by Bosch and Hershey
• Growing new supply sources, such as Nestlé efforts to develop farmer capabilities in India
• A more resilient value chain was formed when Starbucks procured Fairtrade coffee beans and when Walmart ensured that all its suppliers were sustainable
• Preemptive mitigation of reputational risk can arguably be behind Diageo’s efforts to advocate for responsible drinking
• Dramatic reduction in product costs was observed both in addidas’ low-cost footwear for Bottom-of-Pyramid customers as well as Toyota’s success in reducing waste using Lean Principles
• Improvements in productivity were compelled by DuPont’s painting engagements that have halved emissions

REVENUE DRIVERS

• Longer-term strategic insight resulted from Shell’s learnings from Brent Spar that gave rise to Scenario Planning
• Broader access to capital was observed in the rise of Socially-Responsible Investing and also seen when Samsung and the Bank of Shanghai reinforced their corporate governance practices
• Improved brand awareness, recall, and equity was enjoyed by Ben & Jerry’s as a result of their employee-focused culture and by Coca-Cola as a result of their Happiness campaigns
• More word-of-mouth marketing with the use of stories, for instance with Levi’s leveraging on its values to communicate substance and authenticity
• Deeper customer insights are available to Google after it brought Internet access to remote areas to harness better user data
• New product development, such as the low-cost yogurt created due to the Danone-Grameen partnership or the Prius as Toyota’s answer to rising carbon emissions
• Test-bedding breakthrough concepts, as seen in SingTel’s Project SilverLine partnership to bring telecommunications to the elderly
• Unconventional partnerships are observed such as in Becton Dickinson’s healthcare work with NGOs in Vietnam
• Enhanced competitive differentiation, just as how GE’s Ecomagination strategy was able to better communicate the full impact of its range of products
• Higher price premium is created through IBM’s Smarter Planet strategy, which helps its position as a solution provider rather than an IT vendor
• New customer segments were identified by Aetna in its low-cost insurance, GE in its affordable Healthymagination medical technologies, and even UBS in supporting its private banking clients in their philanthropic efforts
• Improved customer benefit was achieved in Pepsi’s acquisition of Quaker Oats and Tropicana in a bid to become a health-conscious foods company
• Increased business volume resulted when Paypal brought trade and market access to small businesses in developing countries
• Stronger customer loyalty was evident after the Ritz-Carlton started empowering its staff with the autonomy to delight its customers
• Long-term market development, as successfully pioneered by Hindustan Lever for Bottom-of-Pyramid consumers in India