Farmers were poor, often illiterate, and unaccustomed to using fertilizer they also lacked access to credit. Roads were inadequate for conveying fertilizer to farms and produce back to the port a third of the harvest was typically left to rot for lack of refrigerated transport. But corruption in the government-controlled port delayed the unloading of shipments for many months.
Fertilizer had the potential to increase crop yields in the famine-afflicted country. Yara, a global leader in fertilizer sales, faced numerous obstacles in its effort to reach African smallholder farmers from its port of entry in Tanzania. But first we’ll take a broad look at how two very different companies-the Norway-based manufacturer Yara and the retail giant Walmart-have used collective-impact principles to improve their ecosystems for all concerned.
In this article we’ll examine the principles of collective impact and explore its basic elements one by one. (introduced in 2011 by John Kania and Mark Kramer in the Stanford Social Innovation Review) has facilitated successful collaborations in the social sector, and it can guide companies’ efforts to bring together the various actors in their ecosystems to catalyze change.Ĭompanies that turn to collective impact will not only advance social progress but also find economic opportunities that their competitors miss. Governments, NGOs, companies, and community members all have essential roles to play, yet they work more often in opposition than in alignment. To advance shared value efforts, therefore, businesses must foster and participate in multisector coalitions-and for that they need a new framework. These conditions are beyond the control of any company-or of any single actor. Government policies present their own limitations, and cultural norms also influence demand. No company operates in isolation each exists in an ecosystem where societal conditions may curtail its markets and restrict the productivity of its suppliers and distributors. Even corporations once known for a hard-nosed approach have embarked on significant shared value initiatives.īut as they pursue shared value strategies, businesses inevitably face barriers at many turns.
At the same time, many of the world’s problems, from income inequality to climate change, are so far-reaching that solutions require the expertise and scalable business models of the private sector. The legitimacy of business has been sharply called into question, with companies seen as prospering at the expense of the broader community. Indeed, in recent years creating shared value-pursuing financial success in a way that also yields societal benefits-has become an imperative for corporations, for two reasons. If business could stimulate social progress in every region of the globe, poverty, pollution, and disease would decline and corporate profits would rise. And MasterCard has brought mobile-banking technology to more than 200 million people in developing countries who previously lacked access to financial services. The €76 billion Italian energy company Enel now generates 45% of its power from renewable and carbon-neutral energy sources, preventing 92 million tons of CO 2 emissions annually. Consider these examples: The first large-scale program to diagnose and treat HIV/AIDS in South Africa was introduced by the global mining company Anglo American to protect its workforce and reduce absenteeism. Yet the connection between social progress and business success is increasingly clear.
In the past, companies rarely perceived themselves as agents of social change.
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