Creating new markets through a Shared Value approach

Kelvin Balogun, Business Unit President, Coca-Cola Southern and

East Africa

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SHARED VALUE: WHAT IT IS

Creating economic value in a way

that also creates value for a society

by addressing its needs and

challenges

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SHARED VALUE: WHAT IT IS NOT

“Businesses acting as businesses,

not as charitable donors, are the

most powerful force for

addressing the pressing issues

we face.”

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Shared Value – The Opportunity

Social needs

Business opportunities

Corporate assets & expertise

Identifies commercial opportunities while simultaneously advancing the economic and social conditions in surrounding communities

Enables companies s to form sustainable relationships with communities and national stakeholders

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The battle against poverty in SA

• 2016: GDP growth was 0.3% vs population growth of 1.6%.

• Unemployment rate = 28%,

• Youth unemployment = 32%

• 25% of South Africans live on under R17/day = 13.8m people

• 55% - live on under R38/day = 30.4m people

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Shoprite: R5 Deli Meals

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Shoprite: Bread subsidy

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Social Impact Investing

• Don’t strip down what you serve in higher-income areas and deliver it to lower-income areas.

• Understand the context you are selling your product in. Does your business truly serve the needs of the customers in that area?

• If you’re going to make a profit from these customers, you must treat them with the same respect you would give a customer in a higher-income area.

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Problems and opportunities

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Quali Health

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Quali Health

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“People are not treated like cattle; they’re treated like human beings. There is a lot of care

put into the customer experience, and I think that gets lost in formal healthcare. Quali

Health’s biggest competitive advantage is not the low cost, but how they deliver care—by

understanding who they are serving.”

Tashmia Ismail, faculty member at GIBS

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Three ways to create Shared Value

• Reconceive products and markets

• Redefine productivity in the value chain

• Build supportive industry clusters at the company’s location

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Reconceiving products and markets

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Redefining productivity

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Building supportive industry clusters

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Coca-Cola: 5 by 20

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Coca-Cola: 5 by 20

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Shared Value at work

COMPANY PRODUCTIVITY

ENVIRONMENTAL IMPACT

SUPPLIER ACCESS AND VIABILITY

EMPLOYEE SKILLS

WORKER SAFETYEMPLOYEE

HEALTH

WATER USE

ENERGY USE

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Unilever: Lifebuoy

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Unilever: Lifebuoy

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Nestlé: Nespresso

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Nestlé: Nespresso

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The Golden Triangle

Government

Civil SocietyBusiness

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Thank you

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