Beyond the Lifeboat: Social Enterprise as One Part of our Socio-economic Restructuring

October 16, 2013

Two weeks ago nearly 1,000 people from 25 countries attended the Social Enterprise World Forum in Calgary. Representatives from all levels of government spoke on the virtues of social enterprise and committed support to the sector. Workshop presenters and keynote speakers, including former Prime Minister Paul Martin, talked about a range of topics relevant to conference participants. 

It was a big deal. Why, you might ask, would so many people make this event a priority with increasingly scarce professional development resources, and why would so many government officials take the time to state their “enthusiastic and unqualified support” for social enterprise? This is a good question, particularly given the fact that most Canadians really have no clue what a social enterprise is. 

Here are the basics. Social enterprises are sometimes created to generate revenue for a non-profit, such as the Salvation Army Thrift Stores that make money for the important programs of the Salvation Army. Sometimes they are created to fill a gap in the community and local economy, such as farmers’ markets that create a space for local people to meet each other and local food producers. Sometimes they are launched to create job opportunities for people with barriers to employment, either long-term or as an essential bridge between unemployment and the labour market. And although focused on social outcomes, these non-profit businesses are also important economic engines in our communities and even in our national and international economies. 

Sounds exciting, doesn’t it! Especially at a time when individuals and communities are facing unprecedented challenges: Funding for non-profits is tight and shrinking; Gaps in community services and the threats to local economies are growing; Income distribution and the corresponding side effects are beginning to alarm even traditional economists; And deep poverty seems stubbornly persistent. Amidst these circumstances, this new model shows a lot of potential – certainly enough to pack out the Telus Convention Centre in Calgary with people from around the world as well as our own political leaders. Clearly, the international attention on this non-profit business model is growing. More attention is also being given to social entrepreneurs – individuals who are starting their own for-profit businesses with a social focus. 

The profits from ReStore are used to support the work of Habitat for Humanity. This site
was included in a tour of Calgary social enterprises for SEWF 2013 [ Source: Thrive Calgary ] 

But be careful now. We have some enormous challenges facing our communities and our planet, with powerful forces and systems perpetuating our momentum in the wrong direction. While social enterprises can contribute significantly to the changes we need in society, social enterprise is not the golden snitch – we won’t win the game by grasping this new, shiny object. We can build a beautiful little lifeboat, but if we do nothing to stop the looming hurricane, our wonderful creation will not change our fate.  In fact, tunnel vision on the business model itself, rather than on the larger systemic problems, will only ensure that we lose the game.

We need to be asking two fundamental questions at all times. First, what kinds of social and economic systems have we created on this planet that lead to the need for social enterprises in the first place. In short, what has caused the problems that we are now trying to solve? Second, what is our vision of a better, healthier, fairer, inclusive, and sustainable world that we seek to create? Without grounding ourselves in the former, we will try to create solutions for challenges that we really don’t understand to begin with, and therefore likely won’t succeed. Without understanding the legacy of colonization, racism, and other historical and systemic forms of social power imbalances, marginalization, and exclusion we lack the knowledge required to achieve real change. Without also grounding ourselves in the latter, we risk being mesmerized by the success of the social enterprise as a business rather than being ever grounded in the vision of something better for all – something that will never be achieved by a social enterprise, or social enterprises, alone. 

This vision will only be achieved with a strong role by government that maximizes its utility for achieving opportunity, equity, access, inclusion, and quality of life for all including the sustainability of our communities and planet. It can only be achieved when informed citizens take decisions in our daily actions and relationships to achieve that vision as well. And it will only be achieved when the private sector also embeds this vision into all their decisions – either by choice, by social pressure, and/or by public regulation. 

October 3, 2013 – Federal minister of Employment and Social Development Jason Kenney delivers
the keynote speech at SEWF 2013 in Calgary [ Source: Ted Rhodes/Calgary Herald ]

Social enterprises, collectively, do have the ability to re-shape our economy – as long we all keep our eyes on that mission. While traditional business models driven by the motivation of profit too often make corresponding decisions that harm our planet and exploit people, social enterprises (as non-share capital corporations) are driven by a social and/or environmental mission. This means that social enterprises make corresponding business decisions with their social and environmental goals at top of mind. As non-profits, social enterprises are accountable for maximizing a benefit to communities, rather than to shareholder demands for maximizing financial returns on their investment. While our current economy creates growing income disparity and concentrates money in the hands of fewer and fewer people, social enterprises permanently reinvest all revenues in their mission. You can see how, if a much greater percentage of our economy consisted of social enterprises, the outcomes of our economy would be greater equity, inclusion, sustainability, and general community and global benefit. 

While we explore and test the potential power of social enterprise, let’s make sure we are grounded in the bigger picture recognizing that it is one tool in a much larger toolkit required for this vision. What we need to do is build an economy that is designed to serve the people rather than designing people to serve the economy. The economy and our social structures are not laws of gravity, they are human constructs. This means that we can re-construct them if we choose. But we need to be clear that this is what we are doing, as opposed to simply aiming for the creation of an assortment of ethical businesses sprinkled through our current systems. A movement is not a structure, but structures can be part of a movement.