Companies can achieve positive impact and business success when sustainability strategies actually create shared value
Abstract: Far too many corporate sustainability and ESG frameworks have become box-ticking exercises and compliance nightmares. At the same time “greenhushing” is on the rise, which mutes the brand voice many companies rely upon to connect with customers on critical issues. Most companies are missing out on opportunities to create value for their businesses and society. As a corporate sustainability consultancy that grew up in the pre-ESG era, we practice an action-oriented approach that’s about creating shared value. It’s about integrating societal needs with core business strategy to boost profit and competitive advantage. CEOs have an opportunity to reboot their sustainability programs by asking (1) “Who did we help? (2) What did we actually do or change? (3) What are the real results for our business?” No longer a niche concept, this is an urgent imperative. We challenge business leaders to leverage their assets for tangible impact, starting with their own workforce and communities—or risk becoming irrelevant. This isn’t about philanthropy; it’s about smart, resilient business in an era of unprecedented challenges.
Let’s be blunt. Are your company’s sustainability initiatives actually moving the needle, or are they just expensive PR?
In today’s chaotic economic and political climate, the old playbook for corporate social responsibility is becoming obsolete. If you’re still celebrating glossy ESG reports while navigating tariffs and a looming recession, you’re missing the point—and a massive opportunity. Many corporate sustainability programs are bloated and out-of-sync with immediate needs. It’s time to stop ticking boxes and start creating real, measurable value – for society and your bottom line.
As business leaders navigate the volatility, they face a crucial challenge: how to achieve healthy financial fundamentals alongside authentic positive impact. The answer lies in “creating shared value”—a strategic approach that integrates societal needs with business goals, transforming sustainability from a box-ticking exercise into a core driver of innovation.
ESG and corporate sustainability programs work reasonably well in times of stability. But we are not living through normal or stable times.
ESG reporting creates a level playing field for risk disclosure for access to investor capital and growth markets. Sustainability initiatives support brand value, employee engagement, and market share dominance. As democratic institutions, civil rights, and environmental protections falter, companies have the opportunity to flex into an even larger role in society. Yet, there is mounting risk of saying the wrong thing or investing in half measures at a time when whipsawing tariffs and waning consumer confidence foreshadow a recession.
The crisis goes beyond economic upheaval. The intellectual chill over critical scientific and academic institutions is spreading to businesses. A practice known as greenhushing is on the rise. Some companies are scaling back public positions on issues ranging from equitable employment to climate action.
In the end, whether companies talk about their social and environmental impact is secondary to how they continue to execute.
The answer isn’t another framework or another 700-page manual. The answer is a fundamental shift in the way companies implement sustainability and ESG. Here’s where we need to go back to the pre-ESG era to rediscover what works.
This proven concept has new urgency and appeal for companies that need to create a premium value proposition through positive impact
Some of the current practice of corporate sustainability and ESG reporting has become bloated and out-of-sync with immediate needs of companies, employees, and communities. Creating Shared Value inspires a back-to-basics approach to strategic planning where business leaders leverage corporate assets in service of urgent societal needs while protecting and growing core business interests.
CSV was introduced in 2006 by Michael Porter of Harvard Business School and Mark Kramer of FSG. Chart and practical consulting framework have been developed by Third Partners.
For companies to effectively wield social influence, we (actually) need to rethink the framework
A management consulting joke goes, “yes, there’s a framework for that!” The problem isn’t just the alphabet soup of cumbersome and fragmented sustainability reporting templates. They were predicated upon a functioning government. Today federal lawful protections for civil rights, environmental justice, scientific research, and health and human services are disappearing. The shift places greater burden on voluntary standards, including corporate sustainability initiatives which were once considered “beyond compliance” activities.
Overwhelmed by frameworks, undermined by politics
In the presence of a functioning rules-based democratic government, the old tools were fine, if slow to produce results. However, the present administration considers many sustainability frameworks antithetical to its priorities, even labeling some as illegal. This, alongside targeting advocacy groups and defunding agencies like the DOE, NOAA, and EPA, puts corporate sustainability in uncharted territory. Advocacy groups whose work was once seen as bipartisan or noncontroversial are coming under attack, including missions to alleviate poverty, lower utility bills and feed the hungry.
Fortunately we don’t need a new framework to reboot sustainable business in a more meaningful, focused direction. We just need the right framework and it already exists. Applied in the right way, the shared value model is the secret weapon businesses need to align their sustainability planning with the urgent social needs of their employees, communities, customers, and suppliers. There is no 700-page implementation guide.
If shared value is the answer, it needs to be implemented
“What is shared value? Corporate policies and practices that enhance the competitive advantage and profitability of the company while simultaneously advancing social and economic conditions in the communities in which it sells and operates. Shared value is not corporate social responsibility, philanthropy, or even sustainability, but a new way to achieve economic success.” – Harvard Business School, Institute for Strategy and Competitiveness
According to HBS, there are three main areas where companies can execute a shared value approach to corporate sustainability.
1. Re-conceiving needs, products and customers
- Do products and services meet emergent societal needs?
- Do we access unserved or underserved markets?
2. Redefining supply chain productivity
- Utilizing resources, energy, suppliers, logistics and employees differently
3. Improving the local and regional business environment
- Improving skills, the supplier base, the regulatory environment, and the supporting institutions that affect the business
- Strengthening the “cluster” on which the company depends.
- Clusters are geographical concentrations of interconnected businesses and institutions in a specific field which enhance collaboration, knowledge sharing, and innovation
Steps to implementing shared value in your organization
All models are theoretical. Most make sense, until you ask, “how?” They must be put into practice through some kind of process, plan or program. There are three initial steps that business leaders should take, with or without the help of a consultant to facilitate.
STEP 1: Take an inventory of known capabilities and assets — including corporate “purpose”. A company’s current capabilities relate to its assets. These include intellectual property (products, services, and knowledge), human capital, financial, and physical capital. Companies exist to develop and grow these assets. At this stage, it’s also important to consider whether leadership, employees, customers or other stakeholders have a shared sense of purpose or mission beyond managing core business concerns. Purpose is important. However, it’s not necessary for a business to be a full blown “social enterprise” in order to create shared value. The notion of purpose for the sake of purpose has become something of a fad and a victim of its own success.
STEP 2: Identify pressing societal needs, starting with the workforce and local community and radiating outward as necessary.
Seventy percent of consumers want to know what brands are doing on social and environmental issues and 46% pay close attention to a brand’s social responsibility efforts when they buy, according to a representative survey.
One of the downfalls of ESG reporting and other sustainability frameworks is that they arose out of a global consensus. Literally, they started at the UN. Thus, they are unwieldy for most businesses to implement. All of that box-checking dilutes attention from the very fundamental process of assessing the immediate needs of workers, their communities, followed by larger regional, country-level and finally global needs. Think of it this way, if every company were to base its sustainability strategy on taking care of its workers and the communities it depends on, there would be no need for bloated globally oriented sustainability frameworks. What happens locally ladders up globally.
STEP 3: Develop an action plan. This is key: shared value exists at the intersection of societal needs, business interests and capabilities. The double materiality framework that is mandatory under the EU Corporate Sustainability Reporting Directive (CSRD) comes close, but the operative word there is reporting. Shared value is about taking action in the business, not merely reporting on risks from and to the business. Shared value actions range from long-term complex changes to immediate responses to urgent community needs.
Examples of shared value in action
Immediate activations, initiatives or programs.
Quick wins that companies can conceive and execute in response to some kind of emergency or urgent threat or opportunity that affects its stakeholders. Strung together over time, these activities begin to form a pattern that makes up a company’s social responsibility through real actions; however they may not go far enough to address other externalities that the business itself is responsible for.
As hurricane Helene ravaged the U.S. southeast in 2024, breweries across the country teamed up to help provide safe drinking water. Some switched over their production lines to canning water instead of beer. Others provided packaging materials and leveraged their distribution networks, becoming collection points for emergency supplies donated by people in surrounding communities.
Longer term product, service, and supply chain innovations.
When companies identify harms that have an adverse impact on society, and transform them into beneficial new products, it’s a virtuous cycle. “Circularity” initiatives aim to close open loops in manufacturing waste, whether energy, raw materials or end-of-life performance. These longer-term innovations can also have a direct social purpose in addition to environmental aims.
Dove soap, a Unilever brand, has been campaigning to support self esteem and body positivity for women and girls since 2004. Dove recently reactivated its 20-year-old Campaign for Real Beauty in response to the threats posed by AI-generated images in beauty advertising, under the new banner: Keep Beauty Real. Dove’s award-winning market positioning differentiates an otherwise commodity product by attaching social values to advertising, brand messaging, education programs. Through partnerships with leading nonprofits like UNICEF, Dove’s self-esteem project has reached over 136 million people, toward a goal of 250 million by 2030.
Core business integration.
When a company identifies an unmet need in its market or community and either grows an entirely new product or service line to meet that need or transforms its go-to-market strategy around existing products to continuously address that need.
Business Example: Kahawa 1893 Coffee is a specialty coffee company founded by Margaret Nyamumbo , a third-generation coffee farmer from Kenya. Kenyan women, who historically are denied land ownership and therefore the ability to take out loans, provide 90% of labor on coffee farms but own just 1% of the land. The company’s impact is fully integrated from raw material sourcing through the final customer experience. First, direct sourcing practices provide a stable market for small-scale farmers. Second, farmers earn additional income through a unique customer tipping program. This income allows women to invest in their families’ education, especially for girls, and contributes to building infrastructure like processing stations within their communities.
How to reboot your company’s sustainability plan for greater action and impact
For over 12 years, the team at Third Partners has been helping companies plan and execute sustainability strategies that are good for business and good for the world. We’ve always believed that creating shared value is the win-win-win approach for companies, society, and the natural environment.
Today, that mission is more urgent than ever, and the traditional tools of the trade are a bit duller than they were a few months ago. Leveraging the shared value framework developed by Porter and Kramer in 2006 can help companies pursue positive impact with less risk of being caught up in toxic political polarization.
If any of the following applies to your company, now is the perfect time to talk about creating shared value:
- Planning to update a materiality assessment
- Setting 2030 sustainability and ESG goals
- Attempting to satisfy requirements in markets that have vastly different regulatory agendas and trajectories e.g. U.S., EU, and Canada
- Resetting sustainability communications to avoid a collision course with a regressive federal agenda
- Feeling pressure from employees, investors, or customers to show progress on sustainability initiatives, while feeling risk from government policy rollbacks or potential political backlash
Corporate brands wield incredible social influence in America. It has become the norm for companies to take sides on issues, speak out, and engage in activities that blur the lines between product and positive impact.
Today’s challenging economic and political climate makes it more critical to cut through the ESG clutter. Ask: “Who did we help? What did we actually do or change? And what were the real results for our business?”
Creating shared value is the true measure of sustainability success.
