Doing social good is good for business. This blog post looks at one type of "good" business model, the social enterprise. It also provided three social enterprise examples - The Big Issue, TREE Alliance and the Plastic Bank.
What is a social enterprise?
A social enterprise is a business that explicitly works to address a social or environmental problem whilst also trying to maximise profits, which are then invested in creating social impact. Rather than having a corporate social responsibility unit within the business, the business itself is built and the core product or services is focussed on addressing the social issue.
Scale of the sector
How many social enterprises are there? Many. The social enterprise sector is rapidly growing. In Australia alone there are approximately 20,000 social enterprises and Social Change Central report the sector had grown 37% during a 5 year period.
The British Council reports the social enterprise sector is thriving in the UK, with more than 70,000 social enterprises contributing 24 billion pounds to the economy and employing 2 million people.
Councils and Associations are popping up globally to support this growing sector. Examples include:
There isn't a global standard and governance body for social enterprises. However, there are various certification processes and mark/badge options, depending on geography. The UK has a certification mark for social enterprises, managed by the accreditation authority Social Enterprise Mark CIC. In Australia, Social Traders manage a certification process for social enterprises. In Malaysia, MaGIC provides national certification to social enterprises operating in Malaysia.
Examples of social enterprise
There are a number of well established social enterprises. The Big Issue and TREE Alliance are two examples.
The Big Issue is a social enterprise making social impact in homelessness. It produces a fortnightly independent magazine, providing many people who can't access mainstream employment with the opportunity to sell the publications, earn an income and engage in their communities. Engaging in work builds confidence and self efficacy. Profits from The Big Issue cycle back into the enterprise to provide services to those who need it. The Big Issue was the invention of The Body Shop cofounder, Gordon Roddick.
TREE Alliance is a global alliance of restaurants that train students in hospitality and offer excellent dining experiences for patrons, with high quality food safety and service standards. The restaurants' profits go directly back into training and social programs to support the students. Examples of TREE Alliance restaurants include the FRIENDS restaurant in Phnom Penh and Khaiphaen in Luang Prabang.
Plastic Bank is a global social enterprise headquartered in Canada that focuses on creating a circular ecosystem for plastic. To date they've recovered 14 million kilograms of ocean plastic (that's equivalent of 700 million plastic bottles or 1.5 billion coffee cup lids of plastic). Look for plastic products with their registered trademark 'Social Plastic'. Social Plastic has been removed from ocean-bound rubbish and has supported a coastal community that collects it. Plastic Bank members collect plastic and deposit it at a local branch, where it is weighed and exchanged for tokens that are deposited into the members account. The member can use the digital tokens on school tuition, food, cooking fuel, health insurance, etc. The plastic is cleaned, sorted and processed at scale. Plastic Bank uses blockchain to keep transparent records of the plastic source for auditing across the supply chain. The Social Plastic is then sold back into the global marketplace and integrated into plastic goods and packaging. It becomes a closed loop.