Social entrepreneurship – seeds of opportunity…
The 2008 financial crisis brought corporate greed to the fore. The amplitude of huge bonuses, unsustainable business models and high level risks made in the name of profit were revealed to the disbelief of the general public. Furthermore, the repercussions of the crisis and ensuing austerity measures brought to light the extent of which our society has been divided and, that deep inequalities deprive many people of access to basic services. Corporations were seen to have acted in their own interest and put profits in front of consumers and those stakeholders indirectly affected by their actions.
As the saying goes “in every crisis lies a seed of opportunity” – it could be argued that this is the catalyst that social enterprise needs to become more widely recognised in mainstream society. On the back of general disillusionment of traditional business models and prevalence of poverty and social exclusion, there is a widening niche for business that look beyond short term profits and consider their social impact as important as their shareholders’ pockets. Often mistaken for charities or non-for-profit organisations, social enterprises earn their money through trade – they use business methods and principles and therefore aim for longevity. However, rather than being driven by profit, their agenda is to advance social, environmental and human rights campaigns. A social enterprise allows profits to be levelled out so that they can be widely distributed to projects or campaigns close to the company’s cause.
Social enterprises can be active in many sectors however they are characterised by having a close connection to communities as well as their most important stakeholders. This results in a constant hands-on approach which can bring about greater impact than, for example, a one-off charitable donation.
While the concept of social enterprise has been discussed for many years, the arguments in favour of a more social approach to business are now louder than ever. In Europe it can be said that social enterprises are still very fragmented, often operating independently of one another. As social and digital media become increasingly powerful tools, it would not be surprising if this helps social business to unite. After all, social enterprise place much emphasis on a participatory approach – therefore creating a culture of accountability and business standards which were lacking by many corporations so badly affected by the financial downturn.