Companies’ need for new reporting mechanisms to better measure and communicate the value — beyond financial — that they create for their stakeholders is increasingly being recognized. As businesses around the globe respond to calls to demonstrate their contribution to inclusive long-term value creation for all of society, the CEO of Novartis is part of the Coalition for Inclusive Capitalism, a group of CEOs from more than 20 global companies that together represent more than US$20 trillion of assets under management. Through the Embankment Project for Inclusive Capitalism, the coalition will work on a proof of concept to encourage and measure long-term value creation.
There is always this assumption from the public sector and civil society that private institutions like Novartis have the profit motive that overtakes their motive to help society. I would argue it is actually the opposite. The only reason we can deliver profits to the world, to our company, and to our shareholders is when we positively impact society.
Over the past three years, Novartis has developed, tested and applied a methodology for valuing the financial, environmental and social (FES) impacts its business activities have on society. The results are intended to reflect the company’s social value beyond financial performance, taking into account the benefits and costs to society in monetary terms. Its impact valuation is still evolving, with gaps in methodologies and data. However, the company believes it is important to share its experiences to date, and Novartis invites external partners and stakeholders to engage with it and advance this field of study. Novartis is part of the Impact Valuation Roundtable.
Valuing The Impact of Wages On Human Capital
The Environmental Impact of Novartis Along Global Supply Chains (Case Study)
The Global Economic Impact of Novartis
The Social Impact of Novartis medicines: Two Case Studies from South Africa and Kenya