I read this article with a bit of wistfulness – social enterprise… working on cat issues IS a social enterprise too, albeit a money-losing one. How I wish that rehoming cats, running TNRM programmes can be self-sustaining, never mind about being in the black. Perhaps someday, non-human centric social enterprises will be feasible. One can dream.
That aside, we would like to once again caution that you open your eyes, whatever the form of your support, as we’ve said here.
This story was printed from TODAYonline
Social enterprises have to make money and serve a greater good
Friday • December 14, 2007
LIKE all businesses, social enterprises need funds to expand and develop their services and products to be sustainable.
However, these enterprises — businesses with social objectives — face a considerable challenge: How can they attract investment when their “returns” often can’t be calculated solely in terms of dollars and cents?
This is one of the key issues faced by social enterprises today, said Dr Andreas Heinecke, who founded Dialogue in the Dark, an exhibition in which the visually-handicapped conduct workshops and guide visitors, teaching them to “see” without using their eyes.
“We usually get seed funding and start off quite strongly, but it’s much harder to get growth money to sustain the business,” said Dr Heinecke, who will be sharing his experiences at the Social Innovators’ Forum here, beginning today.
In lieu of being able to show profitability, companies need to demonstrate their social impact. For instance, through Dialogue in the Dark, participants — who often include corporate executives — learn leadership, communication and management skills, while the blind gain employment and can interact with the public.
“We are not as profitable as other businesses but it’s about how we compensate by taking into consideration the social values and benefits we generate,” said Dr Heinecke. “We conduct social impact studies and narrative studies, we show how many jobs we have generated.”
Such benefits to society should also be taken into account when governments create a legal framework for social enterprises, said Dr Pamela Hartigan, managing director of the Schwab Foundation for Social Entrepreneurship.
“In terms of the legal structure, should there be tax breaks for social entrepreneurs?” asked Dr Hartigan. “They deserve some breaks for what they contribute to society.”
Rather than seeing it as a sector in itself, she felt that social enterprises should come from all industries and sectors.
“In Singapore, people are still grappling with what social enterprise means — many still see it as something that lets charities bring in some income by charging for some of the services they provide,” she said.
People also need to stop thinking that the social sector “shouldn’t be making any money at all”, she said.
Corporations can support social enterprises as part of their Corporate Social Responsibility (CSR) policies, said Ms Julie Trell, the director of the Salesforce.com Foundation, set up to involve and support employees in community work. Its CSR model involves setting up foundations in countries where their regional offices have more than 80 employees.
“We can share our business acumen and help them manage their data, which is our business,” said Ms Trell, who will speak at the forum.
“When I talk to companies here, they tell me they have all this money to give away, but they don’t know what to do with it.”
Companies would benefit from appointing a staff member dedicated to managing CSR, as Banyan Tree Hotels and Resorts has done.
Said its CSR manager Michael Kwee: “It’s important to have someone working with all the different departments.”
The company, he said, relies on local staff at their resorts to understand the support their communities need.
The forum is on until tomorrow, when the sessions will open to the public at the DBS Auditorium from 8.30am to 1.15pm.
Copyright MediaCorp Press Ltd. All rights reserved.
A previous article about the same, in Singapore:
This story was printed from TODAYonline
Wednesday • January 3, 2007
Leong Wee Kiat
AFTER providing seed money for them to grow, the main venture capitalist behind social enterprises here now wants to find out what makes them tick.
The Ministry of Community Development, Youth and Sports (MCYS) has commissioned the Lien Foundation Centre for Social Innovation to carry out a study to examine how non-profit organisations (NPOs) such as charities can run successful profit-making arms.
The charities then would have more money to carry out their activities, beyond relying on donations.
“If charities are able to provide good quality services and extend them beyond their beneficiaries into a business with a social purpose, this can help provide another source of revenue,” said the director of the Centre, Associate Professor Tan Wee Liang.
Since it was set up in 2003 by MCYS, the Social Enterprise Fund has approved more than $5.9 million for 57 proposals.
An example of a social enterprise would be the Barista Express, a small cafe at Clifford Centre, set up by recovering Institute of Mental Health patients.
A slew of restaurants, craft shops and thrift shops, are among other charity-run businesses that have sprung up in the past few years.
Part-therapy, part-employment, such social enterprises provide charities an opportunity to introduce management practices without jeopardising their non-profit operations.
“When non-profits operate social enterprises on business principles, they will learn to operate like business enterprises,” said Prof Tan.
“It may result from the introduction of professional management practices and managers,” he added.
Other benefits include a better understanding of corporate governance, accountability and transparency.
The centre’s study aims to find out whether certain charity sectors are more suitable for starting up and sustaining social enterprises.
The study is also looking at the conditions where small and medium enterprises (SMEs) will start a social enterprise — either on their own or partner a charity.
Eventually, it aims to make recommendations to NPOs and policy-makers on the resources needed to make social enterprises grow.
Apart from over 600 surveys sent out to various voluntary welfare organisations and cooperatives, the Centre has also approached the Association of Small and Medium Enterprises to help reach out to over 5,000 SMEs for their responses.
The study is expected to be completed in April.