Is social enterprise about to come out from the shadows?

Photo / Thinkstoch

This post originally appeared on Sciblogs.co.nz.

Mention the term 'corporate social responsibility', and you'll often get a "yes, but" type of reply.

Yes, it's a good idea, but doesn't work in practice. Yes, we should be doing it, but don't know where to start. Yes, we'll do it when everyone else starts doing so.

Of course 2008's global financial crisis hasn't helped, with companies intent and focusing on pure survival, and any thoughts about triple bottom line reporting and/or greening up of the image and actuality well and truly on the back-burner.

Under that 2008 collective mental model of corporate social responsibility, being 'good' was defined as not being bad, and most company strategies were defensive risk management plays never designed to produce new value or to solve social problems, says Fische Consulting director, Peter Salmon.

"In 2008 there was an expansion of some of the shortfalls of CSR 1.0, and a growth in social cynicism," Salmon says.

However, the 2011 version of corporate social responsibility, now perhaps better defined as social enterprise, is a new beast providing opportunities for innovation and income. Salmon says his thinking on the subject has been influenced by his reading, observations and meetings with people involved in this social enterprise, a "mash up" of ideas.

"Social enterprise is about how businesses align their values and behaviour with the expectations and needs of their stakeholders," he says. "The model for CSR has been shaken in the past couple of years."

From that point of view, both innovation and kick-starting the economy is about finding social needs and finding solutions to them. As governments around the world remove themselves from providing different types of social services, the 'community' is expected to fill the void, and the whole notion of community itself is being reinvented says Salmon.

He notes that many of today's (especially young) entrepreneurs see the world differently from their forebears.

• Blend social and commercial objectives
• Creatively align public, private and NGO resources
• Leverage communities and collaboration
• Are well adapted to young world environments
• Embrace the globalisation of the knowledge workforce
• Are solving systematic problems while meeting market needs

Within this context, Salmon says business schools (including Harvard) are racing to meet the demand for social entrepreneurship programmes.

He says the whole notion of ownership (of knowledge and products) is changing, and "access trumps ownership".

Within this community and social enterprise framework, the Harvard Business Review says business is re-booting itself through shared value. To quote from it:

"Shared value is not about personal value. Nor is it about sharing the value already created by firms - a redistribution approach. Instead, it is about expanding the total pool of economic and social values."

Under this philosophy, CSR is a growth platform, according to Salmon, with new entrepreneurs looking for a sweet spot of social enterprise opportunity by asking the following questions.

• What trends are driving the gaps to widen and grow?
• Where can we make a difference? What are the unmet social needs?
• How can we make a difference? What resources, capabilities and networks can we deploy?

Salmon, who has designed a product (called NextPlays) to help people navigate in the brave new world of corporate social responsibility, says social enterprise can be thought of as CSR 2.0

"Social innovation is designed to help companies evaluate their social strategies beyond moral obligations," he says. "It allows them to generate real business value and deliver positive social change or shared value.

"Social innovation should hold up to the same level of business scrutiny and return on investment expectations as any other corporate strategy."

Salmon says there is a requirement to understand the metrics of social enterprise and innovation, which aren't necessarily the same as business metrics.

Social innovation and enterprise solutions tend to be small, tactical and easy to do.

"But there's no silver bullets as far as these solutions are concerned," he says.

Peter Kerr is a journalist, writer and consultant in the innovation space. View his work and that of 35 other scientists and science writers at Sciblogs, New Zealand's largest science blogging network.