Research on shared value in the Emilia-Romagna District in Italy

Thanks to our partner AICCON at the University of Bologna for this interesting piece of research on shared value in Italy. A summary of the project and its findings can be found below.

Research on shared value in the Emilia-Romagna District in Italy

The creation of a new welfare model implies the involvement of different territorial actors who can contribute to answering unmet social needs. Among the main actors on the scene are the for-profit sector enterprises that undoubtedly play or may play a key role. The purpose of this research was to investigate and highlight how the non-State actors – and especially the for profit enterprises – can contribute to the creation of new welfare services.

This analysis is based on the previous research “Another welfare: generative experiences” (that explored how Third sector organisations contribute to the creation of new welfare services) and on the work of the Social Economy Working Group set up by the Emilia-Romagna Region Ministry for Social Affairs.

The theoretical point of reference has been shared value. It points out that a new way to pursue economic goals is by focusing on social ones. Based on the concept of shared value, the enterprise puts in place strategies, technologies and processes to systematically involve all actors within its ecosystem (employees, customers, partners and suppliers) to get the most of the specific shared value.

In order to fully analyse the concept of shared value, it has been defined in three dimensions:

  • Social value for the community
  • Institutional value
  • Economic value

The research took place from June 2013 and September 2014 and 25 case studies have been selected, 12 of them have been analysed and 7 have been chosen to be further investigated and presented in the final report.

The research project recognized 4 different ways to create shared value:

  1. The first one is the creation of social capital by strong territorial relationships among SMEs and the community. In fact, work inclusion of disadvantaged people in SMEs and educational-training courses, in collaboration with companies, creates a social safeguard through the commercial network. In that way, social inclusion and job introduction of people with disabilities in commercial enterprises allows beneficiaries to enhance their vocational and social skills through the experience, in not-protected places and in very close contact with customers. At the same time, enterprises play an active role in the creation of shared value by sustaining projects aimed at the community wellbeing and through the collaboration with the Third sector to reduce disadvantaged situations.
  2. A second one is related to the establishment of a productive chain between social enterprises and for profit firms. These collaborations guarantee a working activity to disadvantaged people who are integrated in social co-operatives over the time. This enables the achievement of a double goal – decreasing local welfare services and the related costs through the integration of new workers in training while at the same time giving the possibility for the for profit enterprise to create economic value (the production of goods and services), social value (disadvantaged people integration) and institutional value (taking on itself a local social need).
  3. The third one concerns Big co-operatives and for profit enterprises involved in the re-use sector of activity or in the re-distribution of goods within the community through the involvement of the non-profit organisations. In this co-ops and enterprises donate products (either food or other things) that cannot be commercialised anymore. These offered goods are distributed for free to socially and economically disadvantaged people and families. Benefits of this action are both social and environmental. The re-use of surplus contributes to waste reduction and to energy saving reducing the wastefulness of water, energy and soil consumption allowing these resources to be used for the production of food. At the same time, this activity produces an economic saving, allowing non-profit organisations and other institutions to assist poor people in other social projects and policies using the money previously required to buy food. From a social point of view, that allows effectively sustaining vulnerable people responding to their needs involving many different social players in community projects.
  4. The final way to create shared value is represented by Corporate Volunteer Programmes. This is where employees dedicate part of their time to community initiatives. Volunteering pathways are planned together with local non-profit organisations who share goals and operating methods. Corporate volunteering is beneficial at a personal (for each employee), business, and community level. The community and the Third sector can benefit from the stable and structured commitment of new volunteers aimed at reducing local issues by their direct involvement in associations and related projects. Moreover, the collaboration between citizens (employees), enterprises and Third sector will improve social cohesion and community awareness. From the enterprise perspective, these initiatives allow improving corporate reputations and consequently brings a positive economic return. Volunteering experiences also represents training opportunities to empower cross-curricular skills of employees, team building, and employees’ motivation. Indeed, employees have the opportunity to make an effort in sustaining the community improving both their self-confidence and company environment in terms of relationships, team building and business values acceptance.

The full report  can be found here. At the moment the report is in Italian but there are plans to translate it into English.