1.
Increasing shared value through
sustainable entrepreneurship
Corporate social responsibility
Innovation
Smart ventures
Edward Erasmus MA
University of Aruba
Faculty of Accounting, Finance and Marketing
March 11, 2013

2.
Outline presentation
The myth of infinite growth
Sustainability
•
Sustainable entrepreneurship
•
Corporate Social Responsibility
•
Shared Value
•
Aruba’s challenges
•
New forms of ‘preneurship’ for Aruba
•
•

3.
The myth of infinite resources
• Every society clings to a myth by which it lives…
• Ours is the myth of infinite economic growth

4.
The myth of infinite resources
• God provided infinite land, food and
resources for Europeans to exploit…
Discovery of America

5.
The myth of infinite resources
• Science will solve all of the world’s problems
Renaissance

6.
The myth of infinite resources
Industrial revolution

7.
It fueled rapid economic progress

8.
“Global economic activity
(GDP) has increased by a factor
of 40 since the start of the
Industrial Revolution.”
~Intergovernmental Panel on Climate Change (IPCC),
Special Report on Emissions Scenarios, 2001

9.
The myth of infinite resources

10.
Cross border exchange of…
Goods….
People….
Capital…
Culture…

11.
…and cross border exchange of…
Information….

12.
Dramatic increase in production capacity

13.
Era of unlimited choice…

14.
More than we can process or consume…
How many t.v. channels do
you have in your cable
package?

15.
More than we can process or consume…
How many apps
for the iPhone?

16.
The digital revolution…..

17.
The downside….

18.
In the next 40 years
the pressure on Earth’s ecosystems
will increase dramatically

19.
The competition for FOOD, WATER, LAND and
ENERGY will intensify.

20.
Addressing sustainability
• Firstly seriously discussed in the 1980s
• Led by the United Nations
• Focus on critical issues of environment and
development
• Strengthen international cooperation
• Population, food security, the loss of species
and genetic resources, energy, industry, and
human settlements are all interrelated

21.
Sustainable Development
“Development which meets the
needs of the present, without
compromising the ability of future
generations to meet their own
needs.”
- Our Common Future
The Brundtland Commission Report
(1987)

22.
The world is using the equivalent of one
and a half planet to support life on Earth

23.
“Our consumption of the Earth’s
natural resources is depleting the
planet’s ability to replenish itself - and
to sustain life on earth.”
- WWF Global Report

24.
• 3/4 of the world’s fisheries are over-fished
• Half of the world’s original forest has been
destroyed. Additional 2% lost every year.
• Species extinction is currently 1,000x the
natural evolutionary rate
• 1/4 of all the birds and mammals on earth
are in danger of extinction.
• Climate change is already happening, and
poses a threat unlike any other facing
civilization.

25.
So what does it all mean for a
small country like Aruba?

26.
Our current challenges…
Real GDP per capita remained virtually flat since 1990.
Uneven income distribution.
•
Population density: 550 inhabitants per square kilometer.
•
Individuals aged 60+ will double between now and 2025.
•
42% of Aruba’s population is currently chronically obese.
•
A public health care deficit that is growing.
•
Educational performance below expectations.
•
Increased crime and other social problems.
•
Huge government deficits.
•
•

27.
Finding the right balance…
Balance
Preserving
Improvement
natural
of lifestyles
resources
and well-
and
being
ecosystems
We should strive to maintain a delicate balance
between our need to improve lifestyles and feeling of
well-being on one hand, and preserving natural
resources and ecosystems, on which we and future
generations depend on the other hand.

28.
So where do we go from here?...
It’s more than obvious that a new economic,
social and environmental (strategic) model
needs to be implemented……
Sustainability should be the primary focus

29.
Abo dicidi awe, nos Aruba di mañan
Nos Aruba 2025

30.
• To involve the broad community in creating
Why Nos Aruba 2025?
together a vision for Aruba’s future.
• Stimulate sustainable development.
• National Integrated Strategic Plan (NISP).
• To stimulate coordination and dialogue
between all stakeholders.

31.
The process…
Discovery Dream Design Destiny
Design of the ways Destiny - Building
Discovery of the Dream of the
this can be brought the plan to achieve
Positive Core desired future
about this future

32.
The Sustainability Challenge….

33.
Principles
• We integrate economic, social, community and environmental
priorities.
• We respect and live within the natural resources and limits of
our island.
• We must achieve a diversified and dynamic economy (beyond
tourism).
• We honor our culture and values
• We make decisions based on meeting the present needs without
compromising the needs of future generations.
• Everyone — individuals, families, communities, businesses and
government — has accountability for achieving a sustainable
Aruba.

34.
Some great initiatives as a result
of Nos Aruba 2025
However, more needs to be done…

35.
(maatschappelijk verantwoord ondernemen)

36.
Unsustainable business models
never pay off in the end….

37.
An outdated approach to
business and value creation
• Companies have overlooked
 the wellbeing of their customers
 the depletion of natural resources vital to
business
 the viability of key suppliers
 “the economic distress of the
communities in which they produce and
sell”

38.
New leadership calls for a new
approach to conducting business
Visionary leaders think ‘sustainable’….

39.
Think sustainable….
• Environmental resources are limited and are
quite sensitive to everything that we do.
• We are starting to experience the effects of the
actions of generations that came before us.
To make sure that future generations will not
experience worse, we need to be aware of the
ideals and requirements of sustainability….

40.
Corporate Social Responsibility
(maatschappelijk verantwoord ondernemen)
Also known as: sustainable entrepreneurship
…..the integration of business operations and
values, whereby the interests of all
stakeholders including investors, customers,
employees, the community and the
environment are reflected in the company's
policies and actions.

41.
Sustainable enterprises
1. Incorporating principles of sustainability into each
of their business decisions.
2. Supplying or consuming environmentally friendly
products or services that replaces demand for non
green products and/or services.
3. Greener than traditional competition.
4. Enduring commitment to environmental principles
in their business operations.

42.
Why practice CSR?
• Companies have learned the hard lesson that
without a sustainable society, there is no
sustainable business….
• So in instead of focusing on short-run returns
• Companies focus on contributing to long-
term societal well-being in which everybody
can develop and grow.

43.
The evolution of responsibility
Late 2000s
1980s Responsible
Philanthropy Competitiveness
1970s
Shareholders
Early 1990s Early 2000s
Corporate Corporate
Governance Accountability
Late 1990s
Stakeholders
Engagement

44.
The evolution of responsibility
Late 2000s
1980s
Sustainable markets
Health & safety
1970s
Quality
management
Early 1990s Early 2000s
Environmental Triple bottom line
management
Late 1990s
Health, safety &
environment

45.
Focus CSR
Planet
People Profit

46.
CSR towards a new approach?
Corporate Corporate
Social Sustainability &
Responsibility Responsibility
Philanthropic Collaborative
Risk-based Reward-based
 
Image-driven Performance-driven
 
Specialized Integrated
 
Standardized Diversified
 
Marginal Scalable
 
Western Global
 
 

47.
CSR towards a new approach?
CSR can only be resilient if it
CSR is part of the DNA of an
Value
organisation, i.e. CSR will
Creation
only survive the vagaries of
fickle markets, fluctuating
Good
Governance
profits, financial crises and
leadership whims if it is
Societal
totally embedded in the
Contribution
corporate culture, strategy
and governance systems”
Environmental
Integrity – Wayne Visser, 2008

48.
Let’s start from the very beginning....
Porter and Kramer
Harvard Business Review 2011
How to reinvent capitalism – and unleash a wave of innovation and growth

49.
Companies must bring business
and society back together
• Shared value – creating economic
value in a way that also creates value
for society by addressing its needs
and challenges.
• “Business must reconnect company
success with social progress.”

50.
Entrepreneurship on Aruba

51.
Aruba entrepreneurs
Competition oriented (no differentiation)
Same products in same markets
•
Fear of trying out new things
•
Lack of motivations (comfort zone)
•
Technically challenged (so much more
•
out there)
•

52.
Basic conclusion
A change in the fundamental entrepreneurial
thinking on Aruba should happen quickly,
otherwise the small and medium business
sector will autodestruct itself through far-
going cannibalization…
Innovation and sustainable
entrepreneurship is the key…

53.
Developing smart ventures
Innovation
Sustainability
•
Diversification
•
Productivity (resource efficient)
•
Smart growth
•
High-skilled jobs
•
Driven by technology
•
Shared value
•
•

54.
New forms of ‘-preneurs’
• Aruba government economic
policy is geared towards the
development of new
entrepreneurial ventures.

55.
New forms of ‘-preneurs’
Key areas in Aruba that require
Ecopreneuers
entrepreneurial innovation
Sociopreneuers
Creativepreneurs
Globopreneurs

56.
Ecopreneurs
• Commercial ventures
Ecological entrepreneurs
geared towards solving
ecological and
environment problems
Entrepreneurial
areas

57.
Ecopreneurs

58.
Ecopreneurs (in Aruba)
Waste separation plant Barcadera Free Zone
Waste separation and export of recyclable products
(paper, plastic, aluminum, etc.)

59.
Ecopreneurs (in Aruba)
https://www.facebook.com/dogoodaruba

60.
https://www.facebook.com/dogoodaruba

61.
Sociopreneurs
• Entrepreneurs with
Social entrepreneurs
innovative business
solutions to society’s most
pressing social problems.
Entrepreneurial
areas

62.
Sociopreneurs

63.
Sociopreneurs (Aruba)
Green Vibes Sustainability,
Land & Energy NV.
https://www.facebook.com/dogoodaruba

64.
Creativepreneurs
• One who undertakes the
Creative entrepreneurs
creation/production and
distribution of an original
creative work and is able
to create wealth through
an established business
Entrepreneurial
venture.
areas

65.
Creativepreneurs

66.
Creative industries taking over...
Added value: approximately € 7.1 billion in the
Netherlands

67.
Creativepreneurs (in Aruba)

68.
Globopreneurs
• Developers and/or
Global entrepreneurs
distributors of products
and services destined for
export (competing in the
Entrepreneurial global market space).
areas

69.
Globopreneurs
Export expands the economic pie, generates flow of
foreign currency, attracts new technologies and
creates new forms of employment.

70.
Globopreneurs (in Aruba)
• Utilizing Aruba’s unique socio-
economic resources and geo-
political position within the
Kingdom of the Netherlands to
develop new economic
opportunities.
• Positioning Aruba as a strategic
hub (gateway) for European
businesses doing business in
Latin America.

71.
Globopreneurs (in Aruba)
• Moving towards a knowledge-
driven economy.
• Attracting foreign investment
with focus on innovation and
sustainability.
• Synergy free zone, airport and
harbor.

72.
We share an awesome responsibility, you
and I, a responsibility that transcends this
time and this place.

73.
Final thought…
Instead of thinking
“outside the box”, just
get rid of the box…

74.
Paper assignment

75.
Edward M. Erasmus, MA
e.erasmus@fzanv.com
edward.erasmus@ua.aw
Facebook: http://www.facebook.com/edwardmerasmus
Twitter: http://www.twitter.com/em_erasmus
LinkedIn: http://www.linkedin.com/in/edwardmerasmus
Blog: http://edwardmerasmus.wordpress.com

76.
Acknowledgements
• Government of Aruba, Ministry of Economic Affairs, Social Affairs and
Culture: The Green Gateway:
http://www.freezonearuba.com/docs/The-Green-Gateway-Economic-
Vision-and-Policy.pdf
• Green Aruba: http://www.greenaruba.org/
• Lindgren, Anders. Six Forces. Shaping our Present and Future Lives.
www.slideshare.com: anderslindgren4u
• Nos Aruba 2025: http://www.nosaruba2025.aw
• Porter, Michael and Mark R. Kramer, Creating Shared Value:
http://hbr.org/2011/01/the-big-idea-creating-shared-value