Introductory scene setter for the EFMD Conference on Social Enterprise

1. Social Entrepreneurship
By Accident
or
By Design?

2. Social Enterprise
Set up & trade to specifically tackle a social or
environmental need
Entrepreneurial autonomous spirit and social aim
“Change the world for the better”
“Doing business and doing good”
- Not solely maximisation of shareholder value

3. Profit/Social spectrum!
Motives
Business
Social
Business
Social Enterprise
Charity
Profit generation or
distribution?
Maximisation
for shareholders
Max. With Larger
CSR/charitable
aspect
More-than-profit
(NOT not-for-profit)
> 50% reinvested
Not-for Profit
- long-term
Social
Some CSR
Considerable CSR
Key purpose/passion
Key purpose
Environmental
Sustainability
initiatives
Considerable
focus
Key purpose/passion
Key purpose
Ethos
Private sector
efficiency
Bias towards
private sector
Bias toward long
term purpose –
revenue via trading
Public sector
service – £ via
donations or
government
Solutions to
societal
problems
Unlikely unless
incentivised/led
Supportive
/selectively
Address by being
excellent or there
Fulfils some but
not all gaps
Ethics
Bottom-line
focus
Sizeable
consideration
Benefit people &
planet embedded at
outset - balanced
approach
Ethically and
morally driven

4. Social Enterprises

5. Social Entrepreneurs
• Definition – OECD gave 29 different references
– National, regional and cultural differences
• SE’s see the world in a different way - action rather than reflection
• Need to make a difference in a sustainable way
– Triple bottom line – people, profit and planet - flexible
• Want to transform lives, take control/ influence & lead the way
– Assume significant accountability for risks and outcomes - resilient
• Strong social conscience – care deeply and can challenge & network
• Passion to change something on which they feel strongly - intention
– Relentless energy and doggedness – emotional connection to cause
– Campaign for a wider public or social good not their own rights
• Often witnessed/experienced an indignity & decided to take action
– Desire to right a social injustice
– Or make the world a better place
– Want to change others lives more than their own - humble
• With enterprise skills then can see world-changing results
• Value creation not appropriation

6. Social Enterprise v Entrepreneur
“Not all social enterprises are started by social entrepreneurs and not all
social entrepreneurs start social enterprises” ...
.. Charlotte Young, School for Social Entrepreneurs
Definition of a ...social entrepreneur via SSE
“someone who works in an entrepreneurial manner, but for public or social
benefit, rather than simply to make money. Social entrepreneurs may
work in ethical businesses, governmental or public bodies, quangos or
the voluntary and community sector.”
“Entrepreneurship that aims to provide innovative solutions to unresolved
problems”...OECD 2010
“SE’s are in pursuit of sustainable solutions to problems of neglected
positive externalities” (Santos 2009)

7. Social entrepreneur definition
• Definition of “social entrepreneur”........ Wikipedia
“someone who recognises a social problem and uses
entrepreneurial principles to organise, create and
manage a venture to make a social change.”
• Growing arguments over definitions and boundaries
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different definitions in Europe and with USA/Far East
Sense it is growing but difficult to measure
Concentrate on boundaries, analysing the landscape
Over-concentration v over-dilution (exclusive/inclusive)
Typology (Neck et al 2009)
Identify primary and secondary characteristics of social
entrepreneurs (Broard and Larivet 2009)

8. Social Entrepreneurs?
Quakers in 1640’s
Fenwick Weavers Society -Coop
Salt’s Mill & Saltaire
Cadbury’s/Rowntrees
Gurneys of Barclays Bank

9. REFLECTION AT LEEDS MET
• Philanthropy
– learn, earn, share
• New Philanthropists
- channel energies /talents
toward social and
environmental ends
• Economic selfsufficiency/sustainability

10. Definitional tensions
• SE as individual
phenomenon
• SE shaped by social value
• Specific sector only
• Radical social
transformations only
• Global phenomenon
• Collective
• Economic value
creation – serves social
• Cross-sectors public,
NFP and private
• Incremental social
impacts
• Local

11. All kinds of people, all kinds of activity
Activities
• Clothes recycling
• Redesign workshops
• Anti-gun crime merchandise
• Street dance classes on challenging housing estates
• Tap water bottle fill network
Who/People?
• Public sector workers forming new enterprises
• Retirees
• School and community groups
• People from Private business

12. Bill Drayton-Leading Social
Entrepreneurs Changing the World
• Restless.......“Social entrepreneurs are not content to just
give a fish or teach how to fish. They will not rest until they
have revolutionised the fishing industry.”
• “The first and most obvious test of a true social
entrepreneur is, are they possessed, really possessed by an
idea...making it happen across society
• Revolutionary....Entrepreneurial quality – is by far the
toughest (criterion for a social entrepreneur). For every
1,000 people who are creative and altruistic and energetic,
there’s probably only one who fits this criterion, or maybe
even less than that. By this criterion ...we do not mean
someone who can get things done. The are millions of
people who can get things done. There are very, very few
people who will change the pattern in the whole field.”

13. Social Entrepreneurs
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Robert Own – founder of Co-op movement
Vinoba Bhave – founder India’s Land Gift Movement
Ric Edelman/Nigel Hughes – Green Light Trust
Dave Hatherly – Wayland Radio
Gary Hirshberg – Stonyfield Farms
Jeffrey Hollander – Seventh Generation
Michael Young – SSE & > 60 others
Lord Andrew Mawson OBE – Bromley by Bow Centre,
London
• Mohammad Yunus – Grameen Bank
• Iain McArthur – Training for Life

14. Forces on Social Enterprise
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Way people see the world
Free market capitalism being questioned
Politicians budgets limited /insufficient –
systemic retreat of govt from public
provision, giving primacy to market
driven models of welfare
Climate change
Water
Pollution/Sanitation
Rural to urban shift - Far East middle
classes
Inequality poverty and ageism
Extinction
Regulation
Innovation/improvement seen
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Indifference
Networks
Not enough creative ways to
generate income
Scale of change is daunting
Inconvenient truth
National/political interests
Corporate tactics
Authorities holding back
Lack of confidence /ability
Inappropriate systems and processes
to support
Fiscal and regulatory mechanisms
Skill and will-sets

15. Study on Practices and Policies in the
SE Sector in Europe – July 2007
Definition
• Fulfils social goals
• Addresses a target population in need
• Various legal forms but autonomy
• Deals with voluntary social work
• Reinvests profits or ltd distribution
• May receive public funding
• Continuous activity producing and selling
• Significant economic risk
• Paid workers not just volunteers
• Decision-making not based on capital ownership
• Participatory nature of activity –
(re)/integrate disadvantaged
•
Almost impossible to obtain concise meaningful
statistical information
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Legal regulations
Financial Support
Business Support
Measures fostering co-operation
EQUAL – funding for promotion of public and
social enterprise collaboration
•
Austrian Institute for SME Research
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Recommendations and lessons learned
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More stable and predictable funding
instruments
Create EU defn and promote
Provide tailored business support
Encourage horizontal and vertical collaboration
Trans=national monitoring and assistance
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16. OECD 2010 preliminary
recommendations
• Build enabling environments and implement supporting
policies
– Enabling legal, fiscal and regulatory
• Provide sustainable finance
– fiscal incentives for investors & credit enhancement
• Support further research on sector needs
• Provide training opportunities to social entrepreneurs
ands include in curricula
- culture of inclusive entrepreneurship/role models
• Support market development and public procurement
• Evaluate impact – tools and social ROI

17. Social Enterprises EU Contribution 2020
Laszl Andor, EU Commissioner – Oct ‘12
•
Inherently linked to social-market
economy
• October 2011 – European Economic and
Social Committee supported
• 2 million SE’s in Europe accounting for
10% of all EU businesses and over 11 M
paid employees @6% of EU working
population
• Recently this sector created @10% of
new roles in EU
• Role in social inclusion
• “Social Business Initiative” action plan
at EU level
i.
Facilitate Access to finance
ii.
Raise visibility
iii.
Improve legal framework
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Measure socio-economic benefits
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City collaboration on inclusive policies
in labour market
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Emphasised strongly the employment
creating potential
Crucial at this time
Creation of sustainable and high quality
roles
SE’s are pioneers in developing new
markets and creating jobs
Potential European Social
Entrepreneurship Fund – work with ESF
and ERDF
Proposed a fully-fledged new ESF
investment priority for SE’s
Establish an EU level 90 million euro
fund to support hybrid funding
Mapping social enterprises
SE’s largely and untapped source of
inclusive growth and sustainable jobs

18. Social Enterprises
in the UK - scale
Social Entrepreneurship Monitor is a
special report to the Global
Entrepreneurship Monitor found :1.2M people or 3.2% of the working-age
population classed as socialentrepreneurs cf. 6.2% in commercial
entrepreneurship
Social entrepreneurs are more likely to
be women, young and well educated
(Harding 2006). Diverse group and in
economically challenged/deprived areas
UK seen as having a developed SE sector
relative to some EU colleagues
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Third Sector Report in 2009
More than 61,800 in the UK
Combined turnover of £27 bn
@5% businesses with
employees
• Contribute £8.4 bn pa
• Numbers are rising
• Govt appointed socialenterprise ambassadors

19. Structure of Social
Enterprise in UK
Social Enterprise Kitemark – trialled by RISE
Purpose and Beneficiaries of Standards?
-Fair Trade Foundation set up in 1992
Investors
Big Issue Invest
Social Investment Business
Social Equity Fund
Social Impact Bonds
Big Society Capital – a social investment
bank
Research and surveys
56% saw turnover increase (2007/8) against
only 28% of businesses in general
48% were expecting to grow compared with
just 24% of small business in general
Scaleability ?
• Social Enterprise Coalition
(SEC) now Social Ent. UK
• UnLtd – a charity with a remit
to support and develop the
role of social entrepreneurs
• Major global accounting
firms eg. PwC and SSE and
Deloitte Social Innovation
Pioneers Programme
• SSE
• Expertise in investment
readiness and relevance

20. Social Enterprise
Network Orgns in
World
Conferences held eg. World Skoll
Forum, SSE
Open sourcing social solutions and
online communities eg. Social Edge
Procurement sites
Changemakers
Funding mechansims
-Crowdsourcing eg. Zidisha
-Venture funds
-Internet and social networking sites
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Ashoka: Innovators for the Public
The Skoll Foundation
Omidyar Network
Schwab Foundation for Social
Entrepreneurship
Athgo
Root Cause
Canadian Social Entrepreneurship
Foundation
NESsT International
New Profit Inc
National Social Entrepreneurship
Forum
Echoing Green
Social Enterprise UK

21. Part of a bigger healthy thing
• Development toward
– Improving communities
– Improving life chances
– a more connected society driven by
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Climate change - Environment
Internet
Excesses of failed models
Growing societal problems
• Education’s response:
• Today a growing number of colleges and universities are
establishing programmes focused on training and education SE’s

22. Ben Cohen
Values-Driven Business: How to Change
the World, Make Money and Have Fun
“Without question, the balance of power on the
planet today lies in the hands of business.
Corporations rival governments in wealth,
influence and power. Indeed, business all too
often pulls the strings of government. Competing
institutions, religion, the press, even the military
play sub-ordinate roles in much of the world
today. If a values-driven approach to business can
begin to redirect this vast power toward more
constructive ends than the simple accumulation
of wealth, the human race and Planet Earth will
have a fighting chance.”

23. The Reality of Rights – May 2009
• Corporate Responsibility Coalition commissioned the
London School of Economics
“the activities of transnational enterprises can promote
economic development and generate wealth and
prosperity, thereby enhancing the realisation of a broad
range of economic and social rights.
On the other hand, there is no doubt that they can and
do perpetrate human rights abuses affecting both
workers and communities in many of the host countries
in which they operate around the world.”

24. Sir Richard Branson
• Predicted a ........
“sea change from the way business was always
done, when financial profit alone was the
driving force”

25. Tony Manwaring...CEO, Tomorrow’s Co.
• Characteristics of social enterprises are:-
“essential to the new organisational forms we will have to
develop to cope with the challenges of a shrinking world”
Social enterprises as catalysts; Reed Paget, Belu Water
“they challenge the traditional businesses to come up with
environmentally or socially friendly alternatives”
“encourage the battle between big businesses and
entrepreneurs as it will benefit society and the environment”

26. David Bornstein...
How to change the world: Social
entrepreneurs & the Power of New Ideas
“Over the past century, researchers have studied business entrepreneurs
extensively...In contract, social entrepreneurs have received little
attention. Historically, they have been cast as humanitarians or saints,
and stories of their work passed down more in the form of children’s
tales than case studies. While the stories may inspire, the fail to make
social entrepreneurs’ methods comprehensible. One can analyse an
entrepreneur, but how does one analyse a saint?”
“An idea is like a play. It needs a good producer and a good promoter even
if it is a masterpiece. Otherwise the play may never open, or it may
open but for the lack of an audience, close after a week. Similarly, an
idea will not move from the fringes to the mainstream simply because
it is good; it must be skillfully marketed before it will actually shift
people’s perceptions and behaviour.”

27. Why here?
• Social entrepreneurship provides a unique
opportunity for researchers from different
fields and disciplines to challenge and rethink
central concepts and assumptions (Mair and
Marti 2006)

28. Academics/Institutions involved
Andreas Heineke – Danone Chair of Social Business at EBS University,
Weisbaden, Germany
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tolerance, open dialogue and exchange
Dialogue in the Dark social-franchise system
Empathy/tolerance & greater public understanding
Focus on potential not deficiency, ability not disability
Rethink bus. educn & redesign business behaviour
Veroniek Collewaert – Asst Prof. Of Entrepreneurship, Maastricht University
“SE is increasingly relevant and something we should be stimulating and
helping”
Professor Michael Gordon – University of Michigan
– Design your life; change the world
Skoll Centre for Social Entrepreneurship at Said Business School at Oxford Univ

29. Academics involved
Paul C. Light – Professor at New York University’s Robert F. Wagner School of
Public Service and author of “The Search for Social Entrepreneurship”
New Insights
1. SE’s are NOT like other high achievers – they make deliberate decisions to
solve social problems, rather than simply stumbling into their work by
accident or circumstance. Driven by challenge, unshakeable optimism &
commitment
2. SE’s entrepreneurial ideas are BIG....greatest ideas can start small but
eventually break the social equilibrium. Most research focuses on
imagination, invention and launch but IMPACT requires scaling up, diffusion,
sustained pressure and navigation of the “ecosystem of change”.
3. Opportunities for grand change come in waves – history shows this in specific
punctuations or focused periods - experimentation drives the hope for
widespreaad change
4. Socially entrepreneurial orgn’s are built to make change – they are relatively
flat, singularly focused on the idea of change and often inexperienced in
administration and bureaucracy. Little appetite for academic research and
clear that older orgn’s can change or spin out SE’s
Tried truths
I.
SE’s do not always act alone – teams produce improved results
II. Older organisations can nurture social entrepreneurship eg. Univ’s

30. EFMD Conference
• Whether here by accident or design?
• Make the most of the opportunity
• Enjoy