social value by addressing society's needs and challenges. He argues that managers need to reestablish the important relationship between superior firm performance and societal progress. This dual point of view, Porter argues, will not only allow companies to gain and sustain a competitive advantage but also reshape capitalism and its relationship to society.
The shared Yaluc creation framework proposes that managers maintain a dual focus on sharehol der value creation and value creation for society. It recognizes that markets are defined not only by economic needs but also by societal needs. it also advances the perspective that externalities such as pollution , wasted energy, and costly accidents actually create internal costs, at least in lost reputation if not directly on the bottom line. Rather than pitting economic and societal needs in a trade off , Porter suggests that the two can be reconciled to create a larger pie. The shared value creation framework seeks to enhance a firm's competitiveness by identifying connections bet.ween economic and social needs, and then creating a competitive advantage by addressing these business opportunities.