ABSTRACT
A statement of the question. The aim of this paper is to examine how companies officially recognized in Russia as CSR leaders actually introduce modern innovative approaches to value creation through supporting social entrepreneurship. On the one hand, the core idea of connecting CSR with value creation for business and society instead of narrow profit maximization for shareholders has formed a global trend in the development of theory and practice in the beginning of XXI century. Scholars, among others, went through the debates on creating “blended value” or “shared value” via innovative resolving societal problems. On the other hand, it is social entrepreneurship that from its origin sets a system of both economic and social goals and plays an important role in aligning business and society interests. Emerson mentioned “social enterprise” among the other blended value creators [Emerson, 2003]; Porter and Kramer enhance that social entrepreneurs are pioneering in creating shared value through inventing new products using viable business models [Porter, Kramer, 2011]; Michelini and Florentino explained these models precisely [Michelini, Florentino, 2012]; Baron emphasized that social entrepreneurs are able to carry “strategic CSR beyond profit maximization and market value maximization” [Baron, 2005], etc. Nevertheless, the theory and practice of creating blended/shared value via connections between corporate social performance of big businesses and social entrepreneurship development are still under the question.
A number of leading Russian companies, including the so-called “Russian MNCs”, are actively introducing the respective approaches in their vision and mission statements and trying to develop the necessary KPIs and managerial routines. At the same time the real process of creating value by these companies is quite specific, clearly reflecting the national economic and social circumstances.
Method. The research is conducted through the literature review and the analysis of the actual corporate social performance of leading Russian companies and CSR-related social entrepreneurial activities. The empirical data was collected from the survey among participants of the national “Corporate Philanthropy Leaders” award competition (the annual project where the PwC Center for CSR at SPbU GSOM participate as a “research arm”) and through the investigation of business plans of related social entrepreneurs — participants and graduates of Executive Education Program “Project Development for Social Entrepreneurs” implemented at SPbU GSOM (2012–2015).
The main argument. Since the mid of 2010’s some leading Russian corporations have started to transform their traditional philanthropic projects into multisided networks to create blended as well as shared value through social entrepreneurship development in cooperation with the local authorities. These corporations consider support for social entrepreneurship, such as training, consulting, mentoring, projects support, grants, etc., as an effective responsible innovation, partly replacing traditional corporate giving and private charity of their largest shareholders. The paper provides a review of three typical cases:
- Severstal has launched a program of specifying local social problems and supporting social entrepreneurs through the “Urban Development Agency” earlier created by the corporation in collaboration with the City Council of Cherepovets, the location of its largest steel plant.
- RUSAL corporation has created, in cooperation with local authorities, a network of Centers of Innovations in Social Sphere (CISSs) in six cities at the territory of its presence to develop social entrepreneurial activities through concentrating and managing all available resources.
- Norilsk Nickel has implemented the World of New Opportunities program including the DEVELOPMENT focus area (engaging local community to address social issues through the implementation of social entrepreneurship) as the extension to the new corporate development strategy implemented on 2013 with the purpose to improve operating efficiency and raise the quality of investments and capital management.
A statement of the main conclusions. Theoretically, all these cases demonstrate the cooperative efforts to create simultaneously both blended value (by corporations, local authorities, and social entrepreneurs) and shared value in all conventional “ways” on two different but interconnected levels — by corporations through enabling local cluster development, and by social entrepreneurs through reconceiving products and markets and redefining productivity in the value chain. Practically, these cases present different models and instruments of multisided networking created and lead by corporations as well as levels and instruments for measuring blended and shared value. The research will contribute to the existing literature on CSR and social entrepreneurship.
References
- Baron D. P. Corporate Social Responsibility and Social Entrepreneurship. October 2005. Stanford University Research Paper No. 1916.
- Emerson J. The Blended Value Proposition: Integrating Social and Financial Returns. California Management Review. 2003. Summer. Vol. 45. №4. pp. 35–51.
- Michelini L., Fiorentino D. New Business Models for Creating Shared Value. Social Responsibility Journal. 2012. Vol. 8. № 4. pp. 561–577.
- Porter M.E., Kramer M.R. Creating Shared Value. Harvard Business Review. 2011. January–February. pp. 62–77.
5. Social impact, value creation and performance
