Thursday, October 6, 2011

Social Enterprise: merging the profit and non-profit world


Dr. Michael Hodson teaches a class on Christian Social Enterprise (CSE) at Regent College, and defines a CSE as “an enterprise that funds its operations through generating income from the sale of goods or services yet doesn’t seek to maximize profits and consciously seeks to set its aims, strategy, ways of operating and relations with others according to the teaching and example of Christ.”[1] Like other businesses, a CSE produces goods and services that it sells to make a profit. How it is different is that it seeks not to maximize profits, rather its primary motivation is to be socially redemptive.[2]

In Britain, social enterprises are growing in popularity, and serve as a combination of commercial and volunteer sectors. Social enterprises or “social businesses” are impacting British communities through employing unskilled and previously unemployed workers to provide goods and services. Among the group of “social entrepreneurs” are Christians who create CSEs to bring the Kingdom of God to the country’s needy areas.[3]

A great example of a Christian Social Enterprise is the Just Work Economic Initiative, which has emerged from the life and ministry of Grandview Calvary Baptist Church in Vancouver. Just Work employs mainly people with physical disabilities, mental illnesses, additions, or people that are homeless in doing landscape gardening, pottery-making, catering, and building maintenance and minor renovations. David Holcumb, the program director of these social enterprises says, “JustWork exists to help provide that kind of work opportunity for people who need it to supplement the basic [disability] support that they would receive from the government.”[4]

“Well-designed social enterprises are participating in God’s plan for humanity in at least the following ways: 1) creating and promoting – as God did and does – things that are good; 2) working toward the restoration of God’s created world by providing productive, meaningful, and dignified work (i.e., the restoration of personhood), by tending to and responsibly using natural resources (i.e., the restoration of the earth), and by fostering a spirit of cooperation and selflessness between enterprises and within society (i.e. the restoration of relationships); and 3) reflecting the character and redemptive purpose of God – the image of God – through an attitude of loving servanthood.”[5]

Another example of a Christian Social Enterprise is TOMS. Blake Mycoskie founded TOMS in 2006 after going on a trip to Argentina and seeing the extreme poverty, health conditions, and many children walking without shoes. With every pair of shoes that are sold, TOMS gives a new pair of shoes to a child in need. Their motto is “One for One.” What started with selling shoes has grown to selling eyeglasses. The same principle applies. One pair of glasses sold, one pair of glasses given to someone in need. Employees that have worked for TOMS for a year can go on a “shoe drop”, joining a trip to bring shoes to children in need.[6]

One thing to consider with CSEs is whether these enterprises are giving up growth potential by designating a portion of their resources towards a social cause (rather than reinvesting in the company). Starting a new business is difficult enough as it is. According to Silver Lining’s CEO Carissa Reiniger, who has worked with thousands of small business owners, 90% of new businesses fail in their first year. One could imagine the increased difficulty for success when adding the element of doing good for society on top of the need to make the business profitable.

One question I have is whether social enterprise is an efficient way to doing good. The current model is for businesses to focus on maximizing profit, and then out of their profits give to charities and governments (by being taxed) that focus on doing good in society. In a sense, a social enterprise is a business giving up some of its profits to do good in society. Rather than focusing a core competency, it tries to do both business and social good.

Is Social Enterprise the best of both worlds or an example of "Jack of all trades but master of none"?


[1] “Business as Mission: Engaging with Christian Social Enterprise Course”, Regent College Marketplace Institute. 24 June 2010. Web. 15 Sep 2011.
[2] Stirk, Frank. “Entrepreneur, do you love me?” Christian Week. 20 Nov 2009. Web. 15 Sep 2011. <www.christianweek.org>
[3] “Soul Business – the rise of Britian’s Christian Social Entrepreneurs”, FaithWorks. 15 Sep 2011. Web. 15 Sept 2011.
[4] Stirk, Frank. “Entrepreneur, do you love me?” Christian Week. 20 Nov 2009. Web. 15 Sep 2011. <www.christianweek.org>
[5] Lee, Lucas. “The Vision”, an assignment prepared for Dr. Michael Hodson of Regent College. 1 Jun 2011.
[6] “One for One Movement”, Toms. Web. 16 Sep 2011. <www.toms.com>

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