Social Entrepreneurial Idea

Social Entrepreneurial Idea

            Creating a business where profits transform into reinvesting and not for personal gain is truly hard to achieve and probably make your co-leagues raise their eyebrow in this kind of philosophy. The main purpose of creating such business evolves in different aspects and became the foundation of the business’s vision. Most of them consider the objectives of helping the community through the additional labor, reducing environmental problems, or additional tax for the particular area which is truly favorable in the concerned municipality. 

A social business is one which aims to be financially self-sufficient, if not profitable, in its pursuit of a social, ethical or environmental goal. Social Businesses seek to profit from acts that generate social improvements and serve a broader human development purpose. A key attribute of social businesses is that an increase in revenue corresponds to an incremental social enhancement. The social mission will permeate the culture and structure of the organization and the dual bottom lines – social and economic will be in equal standing with the firm pursuing long term maximization of both [1].

According to Professor , a Bangladeshi banker and economist through his book Creating a World without Poverty – Social Business and the Future of Capitalism; he defines what a social business is and what it is not. It boils down to the following requirements[2]:

1.      Social objectives: it needs to have positive social objectives (help comes from the altruistic social services that the business provides to the poor): e.g. health, education, poverty, environment or climate urgency.

2.      Non-profit distribution: investors may not, after having had their investments paid back, take profits out of the enterprise as dividends. A business may also be classed as a social business if is owned by the poor, and therefore the profits directly work to achieve the social objectives of the business, hence this third category.

3.      Community ownership: it needs to be owned by the poor or disadvantaged (dividends and financial growth return to the poor where their fiscal situations are helped bringing them out of poverty): e.g. women, young people or long-term unemployed.

In United Kingdom (UK), the social enterprise or social business in other form are very popular. The demand of the customers for such products and services delivered are very high and being patronized. The support from the upper class is not depleting and over-whelming. This might be the reason why Prof.  want to apply this kind of philosophy. It grown popular to the developed countries, and tracking to the economic capacity of the under-developing countries (mostly in Asia) is not yet adopted.

Some well known social enterprises include John Lewis (a department store owned by a private company), Welsh Water (Glas Cymru), Cafédirect (alternative trading organization), The Eden Project (biggest tourist attraction for greenhouses), Divine Chocolate (Kuapa Kokoo), The Big Issue, the Co-operative Group, Duchy Originals, the London Symphony Orchestra and Jamie Oliver’s Restaurant – 15[3].

Three common characteristics of social enterprises as defined by Social Enterprise London are:

1.      Enterprise orientation: They are directly involved in producing goods or providing services to a market. They seek to be viable trading organisations, with an operating surplus.

2.      Social Aims: They have explicit social aims such as job creation, training or the provision of local services. They have ethical values including a commitment to local capacity building, and they are accountable to their members and the wider community for their social environmental and economic impact.

3.      Social ownership: They are autonomous organizations with governance and ownership structures based on participation by stakeholder groups (users or clients, local community groups etc.) or by trustees. Profits are distributed as profit sharing to stakeholders or used for the benefit of the community.

The social business is not a bad idea, having the thoughts and philosophy in making profit for the benefit of the society. It is a great challenge indeed, especially in a type of country that really needs improvement. The only problem that can be arisen from the objective is: “Can the company holds or sustains the needs for the society?” If the organization is willing to plunge into the risk and can achieve the required demand of the insatiable community, then they must take the opportunity. Most of the business with this kind of vision, succeeds in due time. The business should always think of what could be the impact of this kind of philosophy both in the enterprise and the community they were servicing. There is always advantages and disadvantages in any kind of decision but weigh it right and the business will surely attain what it really wants.

 

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