Social capital

There’s an interesting article in this month’s Social Enterprise magazine on big business and social enterprise. It’s by John Elkington and Charmian Love of Volans and looks at some of the various different ways that corporate big hitters are working with social enterprises – or carrying out socially enterprising project themselves.

The article is part of series, so future installments may reveal more, but – in terms of the examples cited so far – the Danone-Grameen partnership in Bangladesh seems to be an exception in that it’s a genuine business partnership between a social enterprise and a corporate giant.

It’s a great story but, the authors reflect,: “Sadly, though, not every social entrepreneur is Nobel Prize-winning Muhammad Yunus, and not every CEO has the vision of Danone’s Frank Riboud.”

The other examples detailed in the article of  corporates, such as General Electric and GlaxoSmithKline, developing and marketing new products and services based on their social impact at one end of the spectrum of business/charity and a leading purveyor of sugary brown drinks running a high profile grant scheme at the other.

If the authors’ intention was to prove that the current wave corporate social enterprise fancying is something that’s likely to have a broad, meaningful impact in the near future they didn’t manage it. I don’t doubt the earnestness of, for example, PwC’s affection for social enterprise. I do doubt its relevance to the everyday operations of the vast majority of social enterprises in the UK.

It seems to me that much of the current debate about the relationship between social enterprise and ‘the private sector’ vacillitates between two slightly ridiculous positions. One ridiculous position, prevelent on the unrecontructed voluntary sector wing of the movement, is that social enterprise is somehow an alternative to the evil of profit-making business. The other ridiculous position is that the a key part of the business plan for your new community cafe or local recyling business should be a mutually beneficial corporate partnership with an investment bank.

It’s a good thing if big businesses are keen to act in a more socially progressive way and take steps to tackle social problems. It’s not yet clear to me what, if any, connection there is (or is likely to be) between that activity and the activities of the social enterprise movement in the UK.

Social enterprises definitely do need to become less dependent on government contracts and more involved in working with partners to sell goods and services that people want. Partnerships with ‘normal businesses’ are good way of making this happen but, in most cases, these partnerships won’t be ground-breaking synergies between FTSE100 companies and tiny social enterprises doing entirely unrelated work.

They will be pragmatic relationships based on both partners offering something useful to each other and in doing so offering something useful to some customers. I’m looking forward to hearing about some examples of that.

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4 Comments

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4 responses to “Social capital

  1. James Doran

    “social enterprise is somehow an alternative to the evil of profit-making business.”

    This smells like a straw man. Social enterprise is seen by some as an alternative to profit-maximising, not profit-making. Every enterprise must generate a surplus – to invest for the future, to pay creditors, etc.

    But you are correct that business relationships between social enterprise and corporations are pragmatic.

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  2. beanbagsandbullsh1t

    Yes, or that useful ones are.

    I think you’re right about profit-making. I suppose what really belongs there is ‘profit-distributing’.

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  3. Hi David,

    I think we need to look at the results that are produced by some of the partnerships discussed. Big business is not the devil. some big business have really bad practises, some have good ones.

    Planting a few trees while contributing to making half the worlds children obese obviously doesn’t cut it.

    Voluntary sector partnerships with business of all sizes sometimes produces great results and sometimes I’m sure it doesn’t. There will and probably should be more of it though, simply because the time for it has arrived.

    Businesses profit from relationships with charities and social enterprises. It is not a simple relationship of donor and recipient anymore. Politics is not the driving force in this the consumer is, and as we as consumers becomes more aware of the products and services we buy and demand fairer and greener products and services, businesses of all sizes will adapt to providing them. Those that do not will fall by the wayside in time. This is an optimistic view I know but I’m optimistic! An example – http://www.quintessentiallysoho.com/

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  4. beanbagsandbullsh1t

    Martin,

    I think it’s right approach the question with a spirit of optimism. I think there’s definitely scope for social entrepreneurs to work with business people – whether those partners are big business or smaller businesses.

    The challenge, I think, is to move beyond the notion of these partnerships being a nice idea to working out what stuff social enterprise and straight business can do together that’s useful to both partners and to some customers.

    The HOSB link-up with Quintessentially seems like a good example of that. It’s the kind of partnership I’d like to see more of.

    My problem is that, so far, a lot of what’s being trumpeted by the lobby as partnership with business is just wine and back-slapping with no clear purpose. I’m keen to see more examples of businesses and social enterprise actually working together to deliver social change.

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