Tuesday, August 31, 2010

What Shakespeare can teach us about social enterprise – better ‘to be’ or simply ‘to do’?

Many charities and local authorities are now running services and activities under the banner of ‘social enterprise’ to contribute to their sustainability (both as services and organisations).

This perhaps helps to explain why there’s such confusion about what social enterprise is: some organisations presenting their structure and form as the basis for their identity, while others present their actions as their basis.

But... if it means that communities are benefiting through these ‘branded’ trading activities by groups not structured as social enterprises, then how far should we feel ‘protective’ over our identity? After all, there’s a compelling and logical argument along the lines of “as long as they job’s getting done and supporting people is at the focus of what we do, what does it matter how the organisation is structured...” however, taken to its conclusion this argument surely takes us down the path of the end justifying the means (something the Prince of Demark wrestled with famously in Hamlet).

Muhammad Yunus has waded into this historical debate with his refreshed definition of a ‘social business’ (broadly speaking - that as long as you’re primarily benefitting people in need then you ‘tick the box’). But there’s surely a risk with such loose definitions that many privately owned businesses will start to add to their ‘green-wash’ with ‘social-wash’, and that charities will further muddy the waters by having an ongoing reliance on grants and subsidies while presenting what they do as ‘social enterprise’.

Social enterprise is surely about being a sustainable business that’s rooted in the open marketplace and which exists to principally benefit those in need; it shouldn’t matter who’s in its employ or on its board – these things are fixed and immutable. Otherwise, as officers change, markets, customers, and society become confused by different peoples’ values changing the focus and purpose of what that organisation does and how it does it.

But confusion aside, that social enterprise has challenged and inspired such a growing change in common business practices amongst private businesses and charities is surely an impressive achievement and something we can take pride in?


  1. Interesting. Rodney Schwartz's recent review of Muhammad Yunus's 'refreshed definition' suggests that his take on things is too rigid; rather than loose as you suggest.

    You can read Rod's full review on our website: http://www.clearlyso.com/sbblog/?p=956

    Jonny | ClearlySo

  2. Adrian, that isn't what Yunus conveys to me and I was interested to know how others saw it some weeks ago, in this question that nobody answered:


    Now here's how we described the concept, published online and free to use from January 1997, 8 years prior to the appearance of CICs.

    "The P-CED concept is to create new businesses that do things differently from their inception, and perhaps modify existing businesses that want to do it. This business model entails doing exactly the same things by which any business is set up and conducted in the free-market system of economics. The only difference is this: that at least fifty percent of profits go to stimulate a given local economy, instead of going to private hands. In effect, the business would operate in much the same manner as a non-profit organization. The only restrictions are the normal terms and conditions of free-enterprise. If a corporation wants to donate a portion of profits to its local community, it can do so, be it one percent, five percent, or even fifty percent. There is no one to protest or dictate otherwise, except a board of directors and stockholders. This is not a small consideration, since most boards and stockholders would object. But, if an arrangement has been made with said stockholders and directors such that this direction of profits is entirely the point, then no one will object. The corporate charter can require that these monies be directed into community development funds, such as a permanent, irrevocable trust fund. The trust fund, in turn, would be under the oversight of a board of directors made up of employees and community leaders."

    "What's in a name?" a social enterprise by any other name is still for human benefit.

    I can go along with the Yunus definition because what he describes represents exactly what we've done over the last 6 years, as laid out on this page:


    To my mind there's a world of difference between taking the risks that are involved in putting these ideals into practice and the opinions of those advising others how to do it.

    "This above all, unto thine own self be true" would seem appropriate in this context and here's the bottom line.


  3. Here's a coincidence: