Social capitalism?
at 5:17pm on Sunday, 3rd June 2007
Simon Parker chaired a lively roundtable discussion on social enterprise at Demos last week. We wanted to know what the people and organisations representing or supporting the sector in various ways thought of the sector's future.
As Nick Temple from the School for Social Entrepreneurs pointed out in his blog post, the main finding from the discussion was that everyone agrees how diverse the social enterprise sector is - in legal form, mission or ambition.
But what Rob Greenland also picks up from Nick's post is the assumption that social enterprises are somehow considered more legitimate actors for social change than private companies, and that in government or a funders eyes, legal structure therefore does matter.
This exchange highlights one of the main takeaways from the morning for me - that social enterprises are about engaging the public, whether that means making people once part of the problem part of the solution, or getting more people interested in buying fair trade products. Their legitimacy comes from the fact that social entrepreneurs are thinking about people and outcomes. And that also means that over the next 10 years, they will most likely continue to resist government's - or anyone else's - view of their role in society.
What does that mean for policy? Check out an interesting post on the social stock exchange on the Catalyst blog.
As Nick Temple from the School for Social Entrepreneurs pointed out in his blog post, the main finding from the discussion was that everyone agrees how diverse the social enterprise sector is - in legal form, mission or ambition.
But what Rob Greenland also picks up from Nick's post is the assumption that social enterprises are somehow considered more legitimate actors for social change than private companies, and that in government or a funders eyes, legal structure therefore does matter.
This exchange highlights one of the main takeaways from the morning for me - that social enterprises are about engaging the public, whether that means making people once part of the problem part of the solution, or getting more people interested in buying fair trade products. Their legitimacy comes from the fact that social entrepreneurs are thinking about people and outcomes. And that also means that over the next 10 years, they will most likely continue to resist government's - or anyone else's - view of their role in society.
What does that mean for policy? Check out an interesting post on the social stock exchange on the Catalyst blog.
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Comments
Molly
Really enjoyed your post--and thanks for linking to our Social Business Blog. Sounds like I missed a really interesting roundtable discussion-- please let me know the next time you have a debate on the subject, if you could. I have been a long term fan of Demos, and it was, in fact an earlier publication of yours on social enterprise which helped get me interested in the subject in the first place!
The question of legitimacy of a social enterprise is a really complex one. Legitimate in whose eyes? By what yardstick? Much effort goes into debating such things, in the social enterprise sector, and I'm not sure where it gets us. We at Catalyst have been most focused on simply helping to make social businesses and social enterprises as successful as possible. The yardstick of their social contribution as well as any financial surplus generated is the one on which we've chosen to concentrate. I think it's fair to say that this thinking permeates our blog and our business.
I cannot say that the form of ownership is necessarily a useful barometer of legitimacy either. Belu Water, a social business in which we are intimately involved, is generating enormous social benefit, despite being set up as a company, although in their case all the equity can only be owned by water related charities. By contrast, justgiving.com is a for-profit business, which has created tens of millions in charitable donations. Does this make them less legitimate?
Rodney Schwartz
4 June 2007
As Rod says, there's little common ground among those that seek to define social enterprise, due in part I believe to the weak branding of Third Sector which government has wrapped around it.
We. P-CED that is, kicked off as a social enterprise with a thesis advocating a new form of capitalism which was delivered to Bill Clinton's re-election committee and launched first as a guarantee company in the UK in 2004.
We've been deploying profit to eliminate poverty in Eastern Europe since 1999 starting with the Tomsk initiative and now render profit from our software business to the development of a 'Marshall Plan' in Ukraine.
What's become very interesting of late, is the convergence of mainstream politics and business, for instance in Gordon Browns Business Call to Action which reiterates the points made in the P-CED thesis about terrorism and the need to address information poverty. Likewise , what Bill Gates now advocates in creative capitalism is much the same story.
The people-centered model advocates social business which co-exists within the free market system of economics without a separate social stock exchange bing required. It's generated benefits in leveraging a microfinance bank and 10,000 new businesses in Russia and delivered a 'Marshall Plan' strategy to Ukraine's government which is now bearing fruit in the widespread adoption of CSR and social enterprise and in care of orphans.
Where we differ from government and mainstream business is that rather than Gordon Brown's CSR showcasing or the Gates foundation , we're for business which makes eradicating poverty part of its core mission.
Jeff Mowatt
July 2008