It is this transition that we are hoping to help elucidate and provide an actionable framework to help achieve this necessary transition.

From political, business, and civic leaders, we see corporations being challenged to think well beyond their purpose of delivering profits to shareholders exclusively. Thus, a new model is needed.

With that foundation, we have designed a shared-value model for growth. One where corporations redefine their purpose, values, and goals and broaden their thinking beyond shareholder value, short-termism, and extraction. This pivot allows for new business opportunity through partnerships, opens new markets, leads to new product development, improves customer loyalty, and enhances overall brand value. This pivot also ensures the resilience and agility of their supply chain and business ecosystem. At the most macro level, this approach ensures the sustainability and long-term health of all global populations and living beings.

Alongside shareholder value, within the same walls of an organization, we can just shift out enough to explore and assess employee-value generation. This is the adjacent corporate purpose and value driver that would come as companies begin this process of zooming out. When companies factor in shared value with employees across all phases of strategy design and implementation, great yields will be had in overall employee engagement, retainment, happiness, loyalty, and attraction of the world’s best talent. This, in turn, creates positive feedback loops back to shareholders of improved profitability, stock price, market capitalization, etc.

The next expansion of the concentric value circles is to explore opportunities in the value chain for shared growth. This is a progression that many find impossible, counterintuitive, or counterproductive to consider seriously for opportunities of shared growth. Some might worry, why would I want to share growth or add value to potential competitors? “Why would I cooperate? Isn’t the point of business to compete?” All valid questions. The shared value model does advocate and uphold competitive strategies, yet it leverages the systems thinking and embeds the constraints of our new economy by advocating for competition within a collaborative framework. By expanding the sphere of growth, shareholders can expect great predictability in planning, improved supply-chain resilience, more engaged and loyal customers, and less waste in production and transport.

As we continue to build feedback loops of value, a commonly missed opportunity is to direct these efforts to both communities and governments. Communities surround the millions of companies that exist around the world and yet are rarely included in decision-making nor as a viable stakeholder. At best, marginalized communities are targeted for certain “bottom of the pyramid” CPG products. Regarding government engagement, it is well understood that there are significant company profits up for grabs depending on the regulatory context. If companies think longer-term and more holistically, they see that by engaging with governments within a collaborative framework, new partnership can form with even the most competitive market forces. Under these mechanisms, companies and governments can come together to pool resources for R&D, standards development, proactive legislative development, and information exchange. Additionally, these councils and forums can establish mechanisms to identify and eliminate free-riding by punishing those who attempt to cheat the system and work outside its framework.

The final frame of the shared value model is to consider the environment as a critical value driver. To date, this has been categorized as sustainability or net-zero target emissions. Yet, there is so much more. When companies look to the environment not in a just a drawdown and extractive lens, but consider regeneration of natural resources as critical to their supply-chain resilience and overall business vitality, then businesses can start to engage in a truly sustainable, regenerative manner. Shareholders will benefit from reduced climate shocks and thus less damage to facilities and operations. Shareholders will secure and enhance long-term pipelines of natural resources and enjoy the predictability associated with a more symbiotic relationship with the environment.

A starting point in making this transition is in a deep and honest reflection of your present maturity. Where does your company stand in its approach to value and corporate purpose? What is your focus? What does success look like? We’ve identified five steps in the progression toward shared value.