Creating Shared Value Meets Human Rights: A Sense-Making Perspective in Small-Scale Firms

Abstract

How do firms make sense of creating shared value (CSV) projects? In their sense-making processes, do they extend the meaning spectrum to include human rights? What are the dominant cognitive frames through which firms make sense of CSV projects, and are some frames more likely to have transformative power? We pose these questions in the context of small-scale firms in a low-to-middle income country—a context where CSV policies have been promoted extensively over the last decade in the expectation of improved economic competitiveness, growth, and sustainable development processes. We employ a grounded theory approach to identify three dominant cognitive frames used by our respondents to make sense of CSV. The most prevalent frame (growth first) prioritizes economic over social and environmental goals, and considers social, environmental, and human rights benefits to trickle down from economic growth and wealth generation. In the second frame (green-win), economic actors follow a win–win logic according to which environmental sustainability is pursued only if there are clear and foreseeable economic payoffs. The third frame (humanizing the business) is a niche that emphasizes the attainment of certain human rights goals, despite a perceived lack of immediate economic returns. Our work casts doubt on the capacity of CSV projects to stimulate sustainable development processes without radically changing entrepreneurs’ cognitive frames from growth first to humanizing the business.