Differentiation between CSR and CSV

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Business and Society
Differentiation between CSR and CSV

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Table of Contents
Introduction......................................................................................................................................3
Creating Shared Value: Discussion.................................................................................................4
Corporate Social Responsibility: Discussion...................................................................................6
Different approaches to business.....................................................................................................6
The impact and role of various stakeholders...................................................................................8
Conclusion.......................................................................................................................................9
References......................................................................................................................................10

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Introduction
Business and society are largely related to each other. When the society is responsible to promote
a business by using its products and services then the business has a social and moral obligation
of contributing to the society. The relationship is largely reciprocal and hence when a business
prospers it is likely to contribute to the prosperity of a society. In the contemporary market
environment more and more companies are thinking over their social roles and accordingly
making amendments to improve their operations that help them to stay attached with the society.
In this scenario of developing a social responsibility, the strategy has become a key part of the
organisational business plan but it doesn’t mean that organisations have been highly responsible
towards the society as there are certain incidents that have shown the irresponsible and unethical
behavior of organisations which have also been largely criticised (Moczadlo, 2015). This is
where the concept of creating shared value has emerged as an important stream of discussion for
contemporary research scholars. A certain school of thought has differentiated between creating
shared value and corporate social responsibility that has given rise to worldwide business debate.
The present study takes an opportunity to discuss CSV and CSR elaborately and also delve deep
into their efficacy with real-life examples.
Creating Shared Value: Discussion
 Definition of CSV
 Explanation of CSV
 Its practical applications
In the age of globalisation businesses are no longer considered as the key to the development of a
good society rather the capitalist system is questioned for its ignorance and avoidance of social,
environmental and economic catastrophe caused in the society. In this system prospering in a
highly negative and competitive market has become next to impossible for many organisations.
Over the years many organisations have sunk without a trace due to the excessive business
competition but those who have survived not only thought about the commercial perspective of
business but it also focused on understanding the social perspective as well. Over the years
consumers have grown to be more educated and this has given rise to an ethical consumer base
that not only think about the product but the place of origin and how they have been made and

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that is how they choose their products (Crane et al., 2014). In this situation number of social
concepts made rounds in business organisations where Corporate Social Responsibility stood to
be one of the key concepts, but with time this concept took the backseat and new concept came
to the spotlight which is much more constricted and focused on developing a relationship with
the society that is creating shared value.
Creating Shared Value or CSV is a powerful concept considering the recent business
environment and it is there to be used by organisations. CSV is a more constricted concept that
underpins sustainability for an organisation in the best possible manner. The concept of CSV is a
stronger version of CSR which focuses on creating value through the creation of economic value
at the same time contributing to addressing the various challenges in the society and addressing
the needs of the people (Spitzeck and Chapman, 2012). It is a broad concept but easy to
understand as it doesn’t complicate things and assists organisations to create shared value
through various activities. When organisations focus only on the financial perspective they
increase their profit but gets detached from society and the people and this is where CSV helps to
a large extent (Kramer, 2011). It helps the organisations to improve their financial performance
but with a contribution to the environmental development, contribution to the public health,
developing affordable accommodation et cetera. The aspect of creating social value has been
embraced by many organisations in the recent past, one of the most common being Nestle. There
are various aspects that CSV includes, for instance, environmental improvement, education,
improving workforce lifestyles, health, safety and security of people, housing, community, and
economic development, efficient use of water and energy strategies etc. This is a cycle that an
organisation could embrace and move towards overall development of the society. CSV as a tool
focuses on touching all the key points of societal development that not only helps the
organisation to increase its importance from the societal perspective but it also helps the
organisation to ensure long-term sustainability (Beschorner, 2014).