What Is a Social Enterprise, Anyway?
Social enterprises prioritize human and environmental well-being over profits. When you designate a percentage of profits toward helping a specific charity, it can turn your business into a social enterprise. Many social enterprises manage to balance the seemingly conflicting needs of profitability with sustainability and social enterprise. It really is just a question of priorities. Ultimately, a social enterprise is simply a business or nonprofit organization that earns profits and works to achieve social, economic, environmental and/or cultural outcomes.
Different Types of Social Enterprise
In the broadest sense, any business with an established social giving platform could be considered a social enterprise. Most airlines offer free tickets to selected nonprofits, while many other businesses support everything from employee volunteer work to direct grants. All of this could be considered the action of a social enterprise. By pushing efforts to give back to the community, businesses become social enterprises. Most nonprofits offer a social, environmental or cultural benefit. Unless they also sell a product directly, however, they often fall into a different category.
After all, to be a social enterprise, you must first be an enterprise. This can apply to everything from a small catering company that donates meals to a local soup kitchen to a large corporation with an entire arm of the company devoted to community outreach and charitable giving. For some companies, the social aspect is the first line, with profits a distant second. Yes, profits are important, but only because they support the opportunity to do good.
Some Examples of Social Enterprises
Historically, large companies often devote a portion of their profits to social giving, but that is only one way to approach the transformation into a social enterprise. Consider the lead of retail companies like Box Lunch. This retail chain donates a boxed lunch to someone in need for every $10 spent in store. While this makes it difficult to see actual cost on a donation, it makes it clear that the social giving aspect is critical to their mission. To date, they’ve donated more than four million meals.
Amazon.com was slow to enter the charitable giving space, but with programs like Smile, they’ve done tremendous good. Consumers can enroll in Smile and donate a small percentage of their purchases to a charity of their choice. Given the sheer volume of Amazon purchases each year, this program has been very successful. While the donation amount is only 0.5 percent, their heavy volume helps make this a significant source of charitable revenue.
Is Your Business a Social Enterprise?
There’s no one face of a social enterprise. From choosing only ethically sourced material and working with companies that pay employees a living wage to direct donations, the options are endless. There are even manufacturing companies dedicated to reducing waste and moving to sustainable energy sources. These are all examples of social enterprises.
With a small shift in gears, your business can join the social movement. Think about your suppliers, your social giving and your profits. Can you afford to switch to green energy? Can you donate time or money to a local charity? When you become a leader in the social enterprise space, you get the dividends from your customers and additional marketing. Plus, everyone likes to know that their spending is helping someone else.
Posted by Erin | 0 comments