CEO Blog 16: Change is the only thing constant

Social enterprise is part of that BIG change that development sector/third sector/non-government non-profit sector/social sector/social welfare/voluntary sector/civil society/independent sector/impact sector are witnessing worldwide. If Government and Private sector could ever achieve provision of goods and services to entire humanity ensuring just and fair world, we would have not needed the third sector. But for the former to perform, we needed the third sector. Isn’t it? Then where was the need for Social Enterprises to find a place in this ecosystem?

 न कंचित शाश्वतं0

Albert Einstein made this statement after he realized how nations could misuse the nuclear weapons “So far as we, the physicists, are concerned, we are no politicians and it has never been our wish to meddle in politics. But we know a few things that the politicians do not know. And we feel the duty to speak up and to remind those responsible that there is no escape into easy comforts, there is no distance ahead for proceeding little by little and delaying the necessary changes into an indefinite future, there is no time left for petty bargaining. The situation calls for a courageous effort, for a radical change in our whole attitude, in the entire political concept.” This statement drew lot of political flak and criticism and I would not rationalize it but what has stayed with me after reading it is ‘the need for a courageous effort, for a radical change in our whole attitude’. And to me ‘social enterprises’ are demanding it from all of us. We need ‘Change’, we need TO CHANGE!

In our fellowship programme, we ask the fellows ‘what’s your story’? There is no straight answer to it, we know it but this question sometime becomes the most important step in developing their idea, and their mindset as an entrepreneur. The belief we operate from is finding the story and working with it is the important steps to changing one’s life. And SSE’s core on motivating fellows to take actions does the magic. Nothing happens without action. And the same is the story of ‘Social Enterprises’ unfolding in front of us. There is no absolute good or bad, it is all to be looked upon with the idea of relativity. In a movie, a character becomes good or evil in relation to some other character or to a situation which may itself change. This is the reality of life when we look at any particular government, corporate entity, individual or a non-profit. But often this view point is discarded and we have the tendency to lean towards finding the absolute good, the perfect and the holier than thou life goal. This is where, social enterprises are looked upon with suspicion – they are committed to creating social impact yet they operate like a for-profit company.

Social enterprises are defined as organisations that have triple bottom line results – they address social and environmental needs and have a sustainable revenue model, not limited by their legal structure. Only few EU countries have a legal framework in place to support social enterprises, India is yet to take a leap on this front since the legal structure of a social enterprise have a bearing on the type of funds they can attract. And THIS NEEDS A CHANGE.

If we recognize and agree that social enterprises promote and advance inclusive, sustainable growth creating economic activities with social impact; then we must advocate policy & legal framework that supports social enterprises. New CSR rules and policies in the country have limited access to funds, instead of unlocking the potential in favour of social enterprises. Since, if they are registered as private limited they lose out on grants that can enhance their growth & purpose. Social enterprises need grants, atleast in the initial 2-3 years till such time that they have created a sustainable revenue model. On one hand, we want to embrace socially and environmentally responsible business models that consider stakeholder interests but on the other hand predominance of shareholder wealth maximization defeats the very purpose. We expect the social enterprises to behave like non-profits but aspire that they achieve sustainability & create robust top line and bottom line. Small businesses contribute major proportion to Indian economy, and social enterprises have the potential to further enhance it. Be it the innovations, exports, creating jobs, reaching the last mile – social enterprises tick all boxes in favour of contributing to the economic growth of the country. So, can we ask ourselves the question – What should we change that would support social enterprises?

Social leaders across the country who have led most progressive not-for-profit organisations in the last 50 years are embracing and encouraging idea of enterprising social change. Whether it is in the case of promoting women entrepreneurship, skill development, self-employment, promoting eco-friendly products, mobilizing communities into cooperatives or group enterprises, climate action – social enterprises are happening. We cannot deny it. Then why is there a policy & legal paralysis to recognize it? To enable it?

The sector has settled and come to terms with operating in this ambiguity – of for-profit Vs not-for-profit, but there is need for a CHANGE.

In the last 7 years, School for Social Entrepreneurs India has worked with over 100 social entrepreneurs to work on their ideas and create business models. We have created programmes for WASH entrepreneurs, Tribal entrepreneurs, Women entrepreneurs and the fellowship programme has been sector-agnostic supporting new ideas in health, education, livelihood generation, recycling, upcycling, trading organic products etc. We aspire to make social entrepreneurship the norm for all business activities, and hope social bottom line becomes visible everywhere. We are seeing a shift where young people won’t accept business any other way. Government, regulators, facilitators and funders understand social entrepreneurship. Social entrepreneurs are part of an ecosystem approach to social change. And there is a long way to go… 

WE CAN CREATE CHANGE TOGETHER!