“Shared value” is a concept that links social outcomes and economic results, or enhances the competitiveness of a company while simultaneously advancing the economic and social conditions in the communities in which it operates. Michael Porter of the Harvard Business School and Mark Kramer of FSG first wrote about the concept in an 2011 article in the Harvard Business Review. FSG is a nonprofit consulting firm specializing in strategy, evaluation, and research.
The Shared Value Initiative is a global community of practice to drive adoption and implementation of shared value strategies among leading companies, civil society, and government organizations. This report from the Shared Valued Initiative and FSG is based on consultations with over corporate leaders from pharmaceutical, medical device, nutrition, technology and telecommunications sectors as well as global health experts from government agencies, nongovernmental organizations (NGOs), and academic institutions about how best to measure shared value when applied to health solutions. The report was funded by Nestle, Novartis, and GSK.
Shared value is inherent in health technology companies (e.g., pharmaceutical and medical device industry), which create both economic and societal value when they provide products and services that tackle important health problems. This concept is becoming gradually more relevant to companies in other industrial sectors (e.g., nutrition, technology, and telecommunications), as firms seek to enhance their competitiveness by expanding their offering into health care.
Unmet health needs in a shared value context imply significant barriers at the customer level (e.g., low awareness of a condition or lack of acceptability of an intervention leading to poor adherence) and the inability of health care systems to deliver interventions in ways that customers can afford or accept (e.g., lack of financing mechanisms, inefficient supply chains). The shared value opportunity for companies lies in overcoming these barriers to meet unmet health needs profitably.
Shared value strategies include re-conceiving products and markets, re-defining productivity in value chains, and enabling local cluster development.
Among the findings in the report:
- Measurement is needed to accelerate the pace, reduce the costs, and prove the value of shared value investments.
- Shared value changes measurement needs, requiring attention to both the effectiveness of the intervention and the impact at the population level.
- While there is more to measure, companies can adopt tools and approaches from existing public health efforts.