For years, many businesses have been committing a certain percentage of their profit to selected non-profit organisations, but this is usually done as an afterthought – as a kind of charity – and was never part of their business model. And it is in this instance that social enterprises are different from these kind of traditional businesses.
For social enterprises, doing good is part of their business model. To them, doing good is not likened to charity, but is seen as part of the reason why their company exists. Hence, a social entrepreneur is a person who creates a profit and purpose driven organisation. In other words, they believe that doing good in the society is good for business.
Types of Social Entreprises
1. One for One
Do you have a pair of Toms shoes? If yes, you should know that Toms shoes is an example of a social enterprise, because they have a policy that if you buy a pair of their shoes, they will give a pair of shoes away.
Another is a headphone company, LSTN, which gives a hearing exam and hearing aids to a child in need for each set of headphones it sells.
Another great example is Mission Belt. Mission Belt sells highly unique men’s belts and donates $1 for each belt sold. Now, Kiva (the organisation they donate to) issues microloans to poor people in developing countries, and that single dollar donated is used again and again as loans are repaid, hence benefitting even more people. Mission Belt makes this story a key part of its brand by weaving the cause into the company. Each belt sold features the story of someone whose life was changed by a Kiva loan, it’s motto is ‘buy a belt, feed a family’, and even the name Mission Belt gives you the impression of why the company exists.
2. Companies With Multiple Causes
An emerging trend in social entrepreneurship is for companies to create a brand that addresses multiple social challenges. This can be tough to execute well, but some companies have pulled it off beautifully.
For example, Sword and Plough creates a cycle of giving by turning military fabric into high quality handbags, hire ex-soldiers to make the bags, and also donate 10% of profits to causes that have to do with former soldiers. The company is led by two sisters with a long military background, which has contributed greatly to the company’s success.
Another is Indosole, they recreate junk tires into new shoes using a process that has been practiced for years in Indonesia. Through this work, Indosole also brings dignified employment to an Indonesian community that was badly in need of it.
Are there examples of social enterprises in Nigeria? Yes, there are! Take Passnownow.com as an example, education and social content are provided at no cost to Nigerian students in all subjects. But to keep the website running and pay those who manage content on the website, money is needed. This is funded by the parent company – Rise Global Interactive Links Limited – thus ensuring that Nigerian students can blend online learning with classroom learning, improve their understanding and performance at school, and in this way contribute meaningfully to society.
The key aim of all the companies highlighted above is that they deliberately weave the story of their community into the story of their business. You can thus see that businesses can make both money AND a difference, and that social entrepreneurship in its many forms is the best way to realise such vision. So, if I may ask, are you fully on board?