What is Social Enterprise?
Some Brief Answers to Frequently Asked Questions:
What is a Social Enterprise?
Social Enterprises are for-profit ventures that exist to earn profit, and simultaneously, to use their business activities and/or proceeds to create positive cultural, social, and economic outcomes.
The term ‘social enterprise’ has been floating around for a number of years now, and there is a bit of confusion about what exactly distinguishes one from any other sort of business and organization.
The confusion comes because organizations exist on a continuum, as opposed to having fixed characteristics.
What is not a Social Enterprise?
Much business literature correctly states that the most successful businesses solve a problem for their customers. But not all customer problems are social or environmental problems. For example, if your business solves your customers’ problem of wanting to make their sports cars sound louder on the road so they attract more attention. This is not a social enterprise.
How are Social Enterprises Organized?
Some social enterprises are run by non-profit organizations, some by individuals, and many as for-profit corporations, either privately or publicly held. Some jurisdictions have special legislation to allow social enterprises to exist for a specific purpose, while accreditation programs (such as B-corp) are available to demonstrate commitment.
What is Greenwashing?
‘Greenwashing’ is a term to describe companies that state they have social and/or environmental commitments but in fact, do not consistently act on, or deliver results with respect to these intentions. Greenwashing is often undertaken for marketing purposes, or to improve the company's reputation with communities, employees, investors, and governments.
So How do I know if a Social Enterprise is Legitimate?
Social and environmental good comes in many forms and can be measured in many different ways. To know for sure if a company is legitimately attempting to fulfill their social and environmental commitments requires external assessment against a standardized framework (see GRI or the GIIN).
Alternatively, you may choose to do your own research and form your own opinions by talking to employees, people who live near the company's facilities, past and present customers, reading news articles from reliable sources, etc.
Do Social Entreprises make Money?
Like all businesses and organizations, some make more profit than others, depending on a wide range of decisions. See this blog post for more information.
Where can I find out more?
Our blog posts are arranged to help you start and grow your Business of Good. If you have any specific topics or questions, please feel free to comment or send a message below.