Published in Partnership with Forbes.com.
- Social Entrepreneurship has changed the way social change takes place.
- The change has three primary differentiating features: the blurring of the demarcation of profit and non-profit; the emphasis on impact and efficacy; and the sense of urgency and need to scale.
“Whenever I see a problem, I start a business”, said Nobel Laureate Muhammad Yunus in May 2010 at a program at the Commonwealth Club’s Series on Social Entrepreneurship. Thirteen of the leading lights in the field of social entrepreneurship gave talks which have been put together and edited by Dr. Ruth Shapiro in a new book, The Real Problem Solvers. Contributors include Premal Shah of Kiva, Conchy Bretos of Mia Senior Living Solutions, Mary Houghton of the ShoreBank Corporation, Louise Packard of the Trinity Boston Foundation, Sally Osberg of the Skoll Foundation, Matt Bannick of the Omidyar Network, William Foote of Root Capital, Jacqueline Novogratz of the Acumen Fund, Christopher Gergen of Forward Ventures, Kriss Deiglmeier of the Stanford Center for Social Innovation, Jed Emerson of Blended Value, Bill Drayton of Ashoka, and Muhammad Yunus of Grameen Bank.
Whether there is a profit motive or not, the notion that business has a role to play in addressing societal issues is at the heart of today’s discourse on social entrepreneurship. Defining what social entrepreneurship is as well as the difference between it and traditional non-profit management as well as philanthropy is a flourishing discourse. Coined by Bill Drayton of Ashoka in the early 1980’s, the term social entrepreneurship has become somewhat of a catch-all phrase. Originally it referred to someone with the passion of an entrepreneur tackling a social challenge. Now, it has evolved to a number of meanings including but not limited to social interventions with distinctly business characteristics as well as businesses themselves.
With his remark, Dr. Yunus hit upon one of the main themes of the book: the blurring line between profit and non-profit, business and charity when providing a social good. The term non-profit organization has been used to describe what an organization is not rather than what it is. The equalization of social service work with non-profit balance sheets became sacrosanct. In order to do good, common practice and wisdom told us, we could not also do well. Now, that notion is being turned on its head. Not only do social investors believe that it is possible to do good and do well, other aspects of the old mindset are falling away. Many non-profit organizations are developing profitable income streams to both help their constituencies as well as the sustainability of their organizations by ensuring a stable bottom line. Throughout this book, stories of individuals and organizations are blurring the distinction between profit and non-profit are presented.
Another aspect of the social entrepreneurial movement is to approach social change with business rigor and analytical tools. What is efficacy in the non-profit world? What is the difference between a dreamer and an effective do-gooder? Social entrepreneurs are keenly interested in understanding impact. There is great effort to measure efficacy and seek means of improvement. As Jed Emerson, a leading writer and thinker in this space said, “The point isn’t so much whether you are a non-profit or a for-profit by rather how you manage for maximum value and impact as a leader.” The Acumen Fund has created a management system called Pulse which establishes metrics to determine efficacy and improvements in delivering social good. Room to Read measures every dollar against number of schools, libraries, books published and distributed and the time it takes to accomplish each task. These efforts help the non-profit sector become more effective, efficient with better and more economical programs.
Third, there is an extraordinary sense that change needs to be scaled and quickly. There is an increased sense that we must act now. While this is certainly true on environmental issues, the sense of urgency and individual responsibility has spilled out into the larger community. More and more people are feeling personally motivated to be more socially responsible. Schools are responding to this need. According to Aspen Institute, in 2007 63% of business schools in the United States offered courses on social enterprise or other aspects of the nexus between environmental, social and ethical considerations with business decisions. Ashoka provides course materials to over 800 undergraduate programs on social entrepreneurship.
There are a number of people and organizations contributing to the rise of social entrepreneurship. Today, the field has expanded to include the entire ecosystem involved with the promotion, support, and network of those involved with an endeavor designed to make the world a cleaner, more-equitable, healthier, and better-educated place.
Webster defines a movement as an organized effort to promote or attain an end. Today, there are many players, organizations, and strategies within the field of social entrepreneurship. It has become a movement, although not a centrally organized one. It is also a movement where there is a great deal of experimentation and creativity going on. Taking down walls around profit, innovation and investment has cleared the way for new and vibrant thinking and action around social change. While the larger goals remain constant, the strategies of getting there are expanding at a rapid pace. There is tremendous excitement and energy in the world of social entrepreneurship today and with that energy, comes real opportunity for sustainable change.