Social enterprise needs to be defined

Given the recent debacle over the use of social enterprise as a trademark, you’d be forgiven for thinking that this was  an appeal from the social enterprise sector.

It isn’t. It’s the  assertion of BlueWolf, who say this in a recent report:

“Based on Bluewolf’s findings it looks like the social enterprise is taking a little longer to take off than Salesforce might like.

That might be because no one seems to agree on a definition for “social enterprise.” Bluewolf argued in the report that no single definition has really presented itself.

“Social means leveraging Twitter to some and using profits for social good to others,” Bluewolf posited.

Bluewolf advised that this concept needs to be targeted more toward the department level rather than C-level executives as social is more “about helping their teams sell more, engage customers, and drive demand.”

I guess that means we haven’t gone much further forward than when the distinction was made 4 years ago, in an article asking What is Social Enterprise which began:

“There is so far no commonly agreed definition. Is an enterprise social if it produces some sort of social benefit? If so, in that sense, many or indeed most traditional businesses for profit can be considered social enterprises. Business enterprises typically produce something of value for clients and customers, otherwise they would cease to exist as business enterprises. Earning thousands or millions of customers can by definition be considered social benefit. Social refers to groups of people, as contrasted with one person.”

One wonders how much Bluewolf spent on their research to come to the same conclusion. Might they simply have borrowed from what could be found by Googling “what is social enterprise”?

On the other side, the social enterprise community now stirs,  with suggestions of a legal definition.   Sooner or later they may come to understand that it’s not going to be possible to control what others think or say.

So let’s  try to make a start.  There would seem to be something of a concensus among social entrepreneurs, that’s it’s a business whose profits are principally invested in a social purpose.  That was our belief when we launched in the UK in 2004, because it said as much in our 1996 white paper, though it didn’t use the term social enterprise, rather people-centered economic development, instead.

We determined to describe ourselves as a social enterprise, by checking first with the Department of Trade and Industry who agreed that our definition complied with theirs as a social enterprise. This is what theirs said.

“‘Social enterprise’ means an enterprise whose primary objective is to achieve social impact rather than generate profit for owners and stakeholders. It operates in the market through the production of goods and services in an entrepreneurial and innovative way, and uses surpluses mainly to achieve social goals. It is managed in an accountable and transparent way, in particular by involving workers, customers and stakeholders affected by its business activity.”

The question is , where did that come from?  Unlike our very open synopsis which had been posted on the web this was the product of government with no apparent origin.

Perhaps the word social is where we should start our definition, since enterprise is perhaps a given.  How about what’s suggested above, for the benefit  of more than one person, or perhaps for the benefit of more than a corporation, its customers and shareholders?

In his 2006 paper on microeconomic development and social enterprise the same author reasons the case for enterprise which is social, in that it is done for the benefit of a nations’ most impoverished and needy citizens, concluding:

“Profits can be directly applied to help resolve a broad range of social problems: poverty relief, improving childcare, seeding scientific research for nationwide economic advancement, improving communications infrastructure and accessibility, for examples – the target objectives of this particular project plan. The same financial discipline required of any conventional for-profit business can be applied to projects with the primary aim of improving socioeconomic conditions. Profitability provides money needed to be self-sustaining for the purpose of achieving social and economic objectives such as benefit of a nation’s poorest, neediest people. In which case, the enterprise is a social enterprise.”

That view unfortunately wasn’t’ shared by our own government , who determined to relieve us of our considerable investment in intellectual property and set up a replica project, seemingly to benefit themselves and  a few corporate chums. They didn’t have to Google after  fools that we were, we introduced it to them.

There’s the rub. Social means sharing, except when government do it.   So we’re back to square one.

We can make glorious statements about sharing – “who shares wins” for example though it might be more accurate to say ‘to share is rare” in the world of social enterprise.  Take the example I offered earlier today of  Breakthrough Capitalism, where ‘who shares dies’ might be more appropriate.

Today’s dialogue on social enterprise leadership offers a good illustration of how much social there is in social enterprise

It was some months ago that Liam Black, a social enterprise leader who isn’t reticent when it comes to sharing opinions, wrote of his last decade.  I commented describing how ours had been tainted with defamation, hijack and the death of our founder.   A comment soon deleted.   The absence of sector leaders  among those who offered their condolences was notable.

Grameen Bank is now under threat of hijack from Bangladesh government and quite reasonably Liam draws this to our attention but drawing his to the dishonesty  of a Grameen partner,  seems too inconvenient a truth.   As another Grameen partner, his Wavelength organisation might well be tainted by association.  This perhaps is more about protecting his own interest than the injustice done to any other social entrepreneur.

What kind of deluded mind was it, that wrote all those years ago?

Just changing the way business is done, if only by a few companies, can change the flow of wealth, ease and eliminate poverty, and leave us all with something better to worry about. Basic human needs such as food and shelter are fundamental human rights; there are more than enough resources available to go around–if we can just figure out how to share. It cannot be “Me first, mine first”; rather, “Me, too” is more the order of the day.

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