Businesses tend to be viewed as machines for money, serving only its stakeholders. But in recent years, there has been renewed interest in businesses that have greater motivations than profit. Whether it’s helping rebuild impoverished communities or preventing further deforestation, these companies are making a major difference in the world.
What is social entrepreneurship?
Social entrepreneurship refers to a start-up or entrepreneur that aims to use their resources to create good for society or the environment. PBS describes a social entrepreneur as “a person or entity that takes a business approach to effectively solving a social problem.” The Institute for Social Entrepreneurs considers social entrepreneurship the “art of simultaneously pursuing both a financial and a social return on investment (the double bottom line).”
While individual definitions may vary, the common thread is that it involves a business venture motivated by supporting social change.
Why is social entrepreneurship important?
For the betterment of society
Social entrepreneurship isn’t concerned about the stock value or market share. It’s about working towards solutions to important problems in society. Small and medium sized companies are uniquely positioned to support their local communities and make a large impact.
Millennial and Gen Z workforce prioritize CSR
Millennials (born between 1981 and 1996) and Gen Z (born between 1997 and 2012) are two of the largest generations in the global workforce. Since both generations were raised in the Internet age, they share a few similarities, such as digital literacy and a more progressive social view. In terms of career opportunities, both millennials and Gen Zers tend to revere companies with a sense of social responsibility.
Businesses have a responsibility
Speaking of social responsibility, it’s important to remember that keyword: responsibility. Businesses have an elite status within our society: they command significant capital, advertise in major metro areas, and even receive certain tax benefits. They’re also one of the major contributors to pollution. It seems only fair that businesses give back to the communities that support them, either through charitable donations or by allocating resources to social causes.
What are the responsibilities of a social enterprise?
Social enterprises have several unique responsibilities tied to their industry. For one, they must be transparent about the company’s practices and finances. It’s not in the best interest of the community or the business when a company that claims to be socially responsible uses all of its resources for generating more profit.
When the social enterprise’s goals involve a particular community (for example, the LGBTQ community or the Latin American community), it’s important to include representatives from that group and provide fair compensation for their contributions. Too often, a company may claim to know what’s best for others without properly consulting the people who are directly impacted.
Depending on the organization’s mission, social enterprises may be responsible for allocating resources towards community outreach and education. Just as brands need to advertise to bring awareness to a new product or services, social enterprises need to raise attention to the issues that society would rather ignore.
Finally, socially aware businesses need to pave the way for pay equity and fair hiring practices. Social equity should start within the company itself, and that means ensuring that employees are not only hired from diverse backgrounds, but that they are also treated fairly and provided with a safe work environment. Having policies in place to ensure all voices are heard and that employees are paid appropriately is especially important for companies that want to create lasting change.
The impact of social entrepreneurship on society
Social entrepreneurship has radically transformed the fabric of society and the national economy. Some companies have contributed to an improvement in infrastructure, funding for various organizations, or supplies for the underprivileged.
Successful social enterprise examples
Many of the entrepreneurs who are part of the Novel Coworking community work hard to have a positive social impact. Here are a few examples of brands that serve:
After-School All-Stars – Founded in 1992, After-School All-Stars provides comprehensive after-school programs that keep children safe and help them succeed in school and life. Learn more about the programs they offer to over 90,000 kids nationwide by visiting their website.
Greenprint Partners – This green infrastructure delivery partner helps cities achieve high-impact, community-driven stormwater solutions at scale. Their community-first approach enables them to co-design each project with residents to revitalize neighborhoods, increase public health and safety, and create job opportunities. Visit their website to learn more.
AIDS Walk South Dallas – The mission of AIDS Walk South Dallas is to empower all persons living with and affected by HIV/AIDS through prevention, advocacy, education, peer support, and access to care and emergency financial assistance.
Speech IRL – These clinicians, coaches, and creators, help individuals and businesses change they way they communicate. Their speech therapy and communication skills training focuses on achieving real-world changes. Learn more about their speech therapy and business services here.
Social entrepreneurs and start-ups will continue to provide an invaluable service. These companies have found a larger purpose, beyond money, that makes all their struggles in work worthwhile. Even traditional businesses and entrepreneurs can learn something about using their capital and resources towards selfless pursuits.
Learn about the other common types of entrepreneur.
Change can also be started within the company. Learn the difference between an entrepreneur and an intrapreneur.