Each year, I have the distinct pleasure to guest teach the Social Entrepreneurship class at the University Nevada Reno.
In doing my research on what I wanted to share with the students, the topic of social entrepreneurship and/or social enterprise boils down to this: starting or operating a business that makes money and gives back at the same time. Of course, this already exists and has for many years. If you think about the work of nonprofit organizations, private family foundations, charitable trusts, B-corps (benefit corporations) and for profit corporations that continually sponsor, donate (time, talent and resources) and/or establish charitable giving programs (United Way) within the organization, the question I asked is why does this seem like it’s all the new buzz?
I think it’s because most of us are over the headlines of fraud, misconduct, misappropriation, and at times, blatant disregard for our planet in the production and sale of goods and services along with horrendous environmental accidents. If we truly understand that businesses have every opportunity to blend social purpose with corporate mission, they will begin to think about all of the ways they can change, adapt, or adopt principles, practices and values that give full consideration to the interests of their people (employees, customers, investors, shareholders, vendors, and suppliers) so they are fully engaged, enjoying life and creating their own success.
Next, is the company footprint on the planet: How proactive and effective are they at utilizing on-site renewable energy sources, recycling programs, reducing their product packaging, filling a garbage can instead of a dumpster with office trash, and operating in LEED certified buildings and/or work environments?
And finally, what is the social impact the company is making on the local and/or global community (the cause and/or social mission)? The why behind what you do. The true shift is that no one accepts it’s just for profit anymore. Your company has got to play nice and play well with others. In reading about a lot of emerging entrepreneurs from around the globe, their innovation stems from a serious issue not currently being addressed. They are tackling major problems and changing not just their local community, but their nations at large. Their social cause is integrated into the business model and without the cause there is no business.
Every business owner should seriously think about their role in balancing People-Planet-Prosperity because I know for a fact that a lot of their potential and current customers are doing just that and the cost to getting it right is becoming more apparent, especially when you understand the following five trends:
- Transparency: With an ever-evolving ability to gain access to information, regulatory changes and an increase in public interest in reporting and disclosure requirements the request for transparency continues to grow. How do showcase who you are? Do you talk about the things you know and do well? Do you share your network of talented resources with others? Are you being responsible about the information you share on social media, blogs, newsletters etc.? (Exceptions: proprietary information, internal office politics or forecasts of financial information). How does your customer know that your company has voluntarily adopted the forms of self-regulation that demonstrate your corporate conscience and citizenship? Have your formalized company policies that improve your transparency and preserve your company’s mission?
- Trust: Your business impacts society. Do you demonstrate this responsibility effectively in the way you conduct business as if people and place mattered? Do you work to create higher quality jobs and improve the quality of life in your community? Do you prioritize employee wellness by rewarding performance and actively encouraging professional and personal development?
- Social Responsibility: Companies are under a lot of pressure to behave ethically and to demonstrate sensitivity toward social, cultural, economic and environmental issues. How are you responding to the demands to eliminate corrupt, irresponsible or unethical behavior that might bring harm to the community, its people, or the environment before the behavior happens?
- Accessing New Markets: With a global economy comes global stewardship and overcoming barriers such as civil violence, an uneducated workforce, child labor, poverty and unsustainable sources of energy, water, minerals and soil. All companies aiming at long-term profitability and credibility must realize that they have to act in accordance with the norms of right and wrong.
- Philanthropy: Corporate philanthropy is a company’s way of giving back to its community — local, regional, national or international — through financial donations and non-cash contributions such as time, expertise and tangible goods like computers, medicine, food and textbooks. Companies can donate to charities and nonprofits by giving directly from the company’s cash or assets, fundraising through its employees and fundraising from others. A company giving its time or money to charities and nonprofits not only help those the donations serve but also the company through improved employee engagement. Companies who have a social mission and encourage their employees to volunteer had a higher retention rate because employees who enjoyed their workplaces stay longer. This directly affects your bottom line because you have to spend less time recruiting, hiring and training new employees.