Delivering Value While Ensuring Sustainability
One of the most exciting socio-economic movements in the world today is the number of social enterprises springing up to serve communities and contribute to nations’ economic, cultural and developmental growth.
This trend is not only obvious in the US and Europe but also in developing nations where educated and impassioned individuals return to their homelands and dedicate themselves to running ‘businesses’ that have a higher social purpose. Some of these projects focus on assisting underserved communities and improving the lives of the disadvantaged, while others provide services that enhance a country’s existing social, cultural and economic infrastructure. In the UAE entities that come close to the latter definition are crowd sourcing site aflamnah.com, Emirati support portal iloveuae.com, GCC resource ThinkUp, entrepreneurship organization Tamakkan, arts and music platform The Dream Players, and others.
Not all charities, by definition, need to become ‘social enterprises,’ especially those set up specifically as charities with secure governmental or non-governmental funding. But many charities, in this economic climate of funding cuts by local authorities and corporations, see redefining themselves a social enterprise as a way of achieving financial self sufficiency and long term viability.
The definition of a social enterprise is an entity that operates solely for a social purpose, with any surplus revenue invested back into the business or the community. Legal frameworks are still ambiguous about social enterprises and many entities that had previously operated as ‘charities’ are struggling with their new identity and the new ‘ethos’ of their missions.
In my mind the social enterprise benefits from the financial sustainability model to safeguard its existence and to increase its capacity for scaling up. Typically social enterprises depend on the contribution of volunteers, pro bono business services and the largesse of philanthropic organisations. However strategically investing an allocated portion back into the initiative can create success ‘tipping points’ towards greater effectiveness and market competitiveness. Investments can be in areas such as leadership and staffing, marketing, as well as upgrading work tools.
The reason we should all support the growth of social enterprises is that they deliver considerable value to national economies. Because of the nature of their business model, their founders approach their work with a strong commitment ethic driven by a desire to make a difference. Social entities are also usually versatile entities that seek new solutions to old problems, and this dynamic invariably injects innovation and dynamism to the business sector. Apart from all that social enterprises create a wonderful new world order, one with a new ‘business’ understanding of shared responsibility and communal purpose.
By Sana Bagersh, November 2012
