The concept of Shared Value claims that business organizations must work to generate business profit, while at the same time also creating benefits for the public environment and for the community. Whereas the business profit is expressed in financial results such as increasing revenues and/or cutting costs, social benefit can be expressed in a variety of ways. For example, reducing pollution, assisting marginalized populations and so forth. At the root of this concept is the basic assumption that social benefit and/or environmental benefit is not an obstruction for commercial enterprises, but rather a potential growth, economies and innovation engine. The assumption is that through application of the Shared Value concept in the working routine it will be possible to identify new target audiences, to develop innovative products and to improve work processes. Thus there will be a “double profit line” - business profit alongside social benefit.
The government companies, which are commercial companies with substantial assets and abilities, besides having economic and national value and being under government ownership, are natural candidates for adopting a Shared Value strategy.
Adoption of the said strategy, considering the magnitude of the government companies’ business, has significant potential to create a substantial impact on society and the economy in Israel. It enables companies to advance the United Nations’ sustainable development goals, which were endorsed by the government in government decision 4631 dated 14.7.19. Moreover, in view of the fields in which the government companies do their business and the fact that they are government-owned, it is only right that these should be the companies that lead the Shared Value strategy in Israel and serve as a model for other companies in having the Shared Value be an integral part of the Company’s strategic plan.
In view of the request from the Government Companies Authority, the Netivei Israel CEO appointed a Corporate Social Responsibility Director for the Company - Adi Gamliel - to assist in forming the policy on this issue, thereby encouraging the rest of the government companies to implement this principle. Following a directive from the Netivei Israel CEO, Shared Value processes have been integrated in the Company’s divisions’ work plans for 2020, which will be expressed in the Corporate Social Responsibility Report, which reviews this year.
Shared Value in Goverment Companies