Sustainable Business in an Unsustainable World: Three Companies that Show the Impact of Corporate Shared Value
We are living in a time marked by rapid change, in which information seems infinite and the unimaginable seems possible. These changes have caused a transformation in the business sector – both by introducing the disruptions of digital technology, and by sparking a newfound focus on the social impact of business itself.
We are all facing this reality – from leaders at Fortune 500 companies to founders of social enterprises – and the first question we must ask ourselves is… why? Why are we seeing such widespread societal change, and what does it mean for businesses operating in this new reality?
The driving force behind this shift cannot be attributed to one singular event. Instead, it’s due to an unprecedented combination of access to information, changing public perception, political shifts and optimism. We know that in the United States, for example, 95% of college grads consider a sense of purpose at least moderately important in their work, while globally, two thirds of people are willing to pay more for products and services provided by companies committed to positive social and environmental impact.
The implications are clear: In today’s world, companies are being measured by more than profits. Communities, customers and employees are holding businesses to a higher standard and forcing them to recognize that sustainable success is driven by an underlying purpose. These new standards can be seen in a company’s employees, in its ever-evolving core values, and in shareholder demands that businesses become more sustainable in an increasingly complex world.
For businesses, the best way to respond to this shifting mentality lies in ideas like Harvard business professor Michael Porter’s Corporate Shared Value – a concept that allows companies to create sustainable business models that enhance their competitiveness, while simultaneously doing good in their communities. This concept can be seen at play in the business models of many social enterprises – including several across the Chicagoland region. Let’s take a look at a few examples.
Sweet Beginnings is a social enterprise based in Chicago’s North Lawndale community. In this neighborhood, 43% of the population live below the poverty line, 21% are unemployed, and up to 57% of adults have been formerly incarcerated. In an effort to change this reality, Sweet Beginnings is tackling the linked problems of incarceration and poverty. It’s doing this by connecting community residents – who, due to former incarceration or other circumstances, have found it difficult to procure gainful employment – with skills and job training that allow them to succeed both at Sweet Beginnings and in other careers down the line. These individuals manage local bee hives, marketing, sales and the production of homegrown honey-based products that are currently sold at Mariano’s, O’Hare International Airport and Whole Foods.
Now Pow is a woman-owned and operated company in Chicago’s Hyde Park neighborhood that uses a digital platform and data analytics to connect patients in under-informed communities to local health services. The founder, Dr. Stacy Lindau, envisioned a platform that would make connecting people with community resources a simple process of just a few clicks. The company now successfully uses digital technology to link people with health and social challenges to hyperlocal community-based providers who offer the services they need. Through its licensing contracts with health care providers and hospital networks across the country, it now supports more than 16,000 care professionals and serves over 6 million people across the United States.
DL3 Realty is a real estate company that works to revitalize communities through dynamic development projects that provide neighborhoods with positive economic and social activity, while giving residents new opportunities to build wealth. This development and advisory firm has an extensive track record in Chicago of completing catalytic projects. These include a new Jewel-Osco – the first full-service grocery store in Woodlawn in more than 40 years – and a Whole Foods-anchored shopping center called Englewood Square – both located in severely disinvested Chicago neighborhoods. Most recently, DL3 Realty has partnered with some of the most reputable developers in Chicago to build additional resources and infrastructure around these anchor projects. In the pipeline, for example, is the creation of a mixed-use commercial hub that will reside in a 94-year old building that was previously home to a bank that has sat vacant for 25-years.
These businesses are prime examples of models that are committed to the concept of Corporate Shared Value. Each embrace operational practices that are used to create a competitive advantage while improving economic and social conditions. Compared to the global scale of the problems they’re addressing, these trail-blazing companies are hyperlocal in their focus – but they are setting an example for other social enterprises and corporations to follow. They demonstrate how businesses can balance their bottom line, while strategically growing in a sustainable way that communities, employees and consumers can support.
As the pace of global changes, both good and bad, continues to accelerate, I believe businesses that choose to strike a balance between profit and purpose will have a greater chance at long-term stability and prosperity.
Photo: NowPow CEO Rachel Kohler (left) with Founder and Chief Innovation Officer Dr. Stacy Lindau (right).
- Social Enterprise