For decades, the narrative surrounding businesses has been simple: companies exist to generate profit. That story, however, has shifted dramatically in the first two decades of the 21st century: With the climate crisis unfolding across the globe, we are also witnessing major world events that have challenged the very definition of humanity and, indeed, the conduct of business.
While financial success remains crucial, a new paradigm has been on the horizon for some time—one that redefines capitalism by weaving societal well-being into the very fabric of business strategy. Known as Creating Shared Value (CSV), this concept is not just about “doing good” alongside profit, but rather, about harnessing the power of business to drive both economic growth and positive social impact.
The business concept pioneered by Harvard Business School’s Michael Porter and Mark Kramer was introduced in a 2006 Harvard Business Review article, “Strategy & Society: The Link between Competitive Advantage and Corporate Social Responsibility.” They argue that corporate social responsibility can significantly advance social progress when businesses leverage their substantial resources, expertise, and insights toward activities that directly benefit society.
Following this up in a seminal paper in 2011 titled “Creating Shared Value,” Porter and Kramer put forth CSV as a challenge to the traditional limited view of capitalism. A company’s success, they said, is intrinsically linked to the health of its surrounding community. A thriving community provides a market for goods and services, skilled workforces, and a supportive environment. Conversely, businesses can empower communities by creating jobs, fostering innovation, and addressing critical societal needs.
CSV most certainly ignited a movement, providing a blueprint for businesses to balance profit and corporate responsibility. The core idea is that shared value consists of policies and practices that enhance both competitiveness and the economic and social well-being of communities. This is not philanthropy but enlightened self-interest.
They argued that profits are not created equal. Companies can pursue a higher form of capitalism by prioritizing shared values. This benefits society and improves the business’s operating environment, ultimately strengthening the organization. As Porter and Kramer noted, “If all companies individually pursued shared value connected to their particular businesses, society’s overall interests would be served.”
Harnessing the power of data
However, a 2022 report by the World Economic Forum noted that despite its promise, shared value has not fully materialized, adding that in the past decade, inequality, health, and climate change have worsened. In the United States, for example, the wealth gap has widened, with the top 1% of Americans increasing their share of wealth from 29% to 32.3%, while the bottom 50% saw a slight increase from 0.4% to 2.6%.
Even as the concept of “doing well” while “doing good” remains the ideal, more than a decade later, the Fourth Industrial Revolution demands a reexamination of the shared value framework to align with the current data-driven regime.
While Kramer and Porter’s shared value construct held great promise, it did not fully anticipate the transformative power of data. Our understanding of data’s potential and volume has evolved significantly in the past decade, and its exponential growth is inevitable.
Notably, data-driven technology organizations have experienced exceptional growth. The same report stated that Microsoft and Facebook/Meta’s market capitalization surged by approximately 850% between 2011 and 2022, while Google’s increased by over 300% since 2014—spectacular growth largely attributable to the Fourth Industrial Revolution and the pivotal role of data in digital transformation and the evolving economy.
Even global leaderships are bracing for the geopolitical consequences of radical technologies like Artificial Intelligence. In Technology and the Rise of Great Powers (2024), political scientist Jeffrey Ding shows how technological revolutions have impacted competition among great powers, and why some states had been more successful than others at adapting and embracing new technologies at scale. He proposes a theory based on historical case studies and statistical analysis that highlights the importance of institutional adaptations for widespread diffusion of technological advancements across the economy. In a word, a state’s success in spreading innovation and promoting its adoption is as essential as its ability to innovate.
Similarly, as a cornerstone of the future,data will drive corporate success. To integrate data into the shared value framework, we must ensure that other entities and organizations have access to tools and resources for harnessing data to address social and environmental challenges.
True—data isn’t the sole hurdle to achieving shared value, but it plays a critical role. In a shared value construct, data is predominantly used for profit maximization rather than societal benefit at the required speed and scale. As such, the technology transformation has inadvertently created a data divide: While commercial sectors have benefited from data strategies, public sectors and nonprofits lag in education, tools, resources, and talent for utilizing data to identify and scale solutions. This disparity underscores the gap between data’s commercial value and its comparatively limited use in addressing social and environmental challenges.
Value for small businesses
Late last year, GoTyme Bank, a joint venture of Tyme, a multicountry digital banking group, with members of the Gokongwei Group, and today a leading banking platform in the Philippines, launched its first loan product—PayMongo Capital for micro, small, and medium enterprises (MSMEs)—in partnership with merchant payments solutions provider PayMongo Philippines Inc. This is a big step for GoTyme, and one in keeping with its commitment to pursue financial inclusion and the best customer service.
This, too, is a good example of CSV in action. GoTyme understands that financial inclusion is the foundation of a thriving community. Through its accessible financial products and services, GoTyme empowers Filipinos to participate in the digital economy. This not only fosters financial independence for individuals but also fuels economic growth by unlocking new avenues for entrepreneurship and financial transactions heretofore unavailable to the majority.
PayMongo Capital, for instance, can be a starting point for smaller businesses that have no ready access to formal credit. An MSME owner can get going with PayMongo, creating data that become the proxy for their credibility to borrow and pay back. When they repay promptly they’ll be eligible for more. It’s not a “one-time, big time” proposition; rather, it’s about creating a long relationship that will help the merchant grow their business sustainably.
Eligible PayMongo users will be offered loans tailored to their transaction history, with specific amounts, tenors, and rates. Loans of up to PhP500,000 can be received within one business day through automatic deductions from daily sales in the registered bank account.
We at GoTyme like to celebrate such MSME wins, one of which is the story of Rommel Narvaez, founder of Tinapa is Life, who launched his smoked fish business as an offshoot of his health journey. The business owner, digital innovator, and data-driven marketer put up his own website and did direct-to-consumer marketing—a truly digital company. Recently he turned a challenge into an opportunity, fulfilling a massive order in just three days with the swift support of PayMongo and GoTyme. Thanks to flexible, automatic repayment, Rommel could focus on what truly matters—growing his business and pursuing his passion, stress-free.
Not to put too fine a point on it, GoTyme, via PayMongo Capital, goes to the heart of CSV. Tinapa is Life sources its ingredients and fish from the local community, creating relationships with the small tinapa makers, vendors, and middlemen via its e-commerce technology. By engaging with housewives in Metro Manila, they are able to create a sustainable distribution network. They help provide livelihoods and generate additional income for those who also find their products great tasting.
CSV is a win-win for business and society
The benefits of CSV are not one-sided. Companies that embrace this approach unlock a wealth of opportunities. CSV fosters innovation by identifying solutions to societal challenges that become new markets and revenue streams. It strengthens brand reputation as consumers increasingly gravitate toward businesses that align with their values. Additionally, a healthy and empowered community translates to a more stable and productive workforce for companies.
Of course, CSV is not without its challenges. Discerning genuine CSV initiatives from mere “greenwashing” is crucial. As consumers, we must hold companies accountable and demand transparency in their social impact efforts.
Meanwhile, the following three strategies may help companies set their sights on economic success by focusing on societal well-being. By reimagining products and marketsand identifying and addressing unmet societal needs, companies can develop innovative products and services that create new markets and drive growth; revamping productivity in the value chain by optimizing processes and resource utilization, so as to improve efficiency, reduce costs, and positively impact social and environmental outcomes; and enhancing the local business environment by investing in infrastructure, education, and community development, thereby creating a more favorable business climate that benefits both the company and the community.
These strategies are interconnected in a virtuous cycle: Progress in one area can lead to opportunities in the others.
Ultimately, it is fair to ask: Wouldn’t we rather support a company that contributes to a better future while achieving financial success? Wouldn’t we want to be part of a workforce that creates positive change? CSV offers a path forward for businesses to redefine their role in society, fostering a future where prosperity and progress go hand-in-hand.
As GoTyme Bank’s commitment to pursue CSV down the line demonstrates, this is not just a theoretical concept—it’s a powerful business model with the potential to unlock a new era of shared success.
