Give a person a stick, and he or she will draw a line in the sand. As a social entrepreneur and business consultant, I frequently find myself coming up against a corporate tendency to put business operatives into boxes, as though they can only have one focus: money, or social action. With firsthand experience standing with one foot on either side of the metaphorical divide, I can say with full confidence that this mindset is nonsense – and limiting for those on both sides. Rather, I would argue that to enact true social change for the future, we will need to draw on both the innovative creativity of profit-minded entrepreneurship and the moral direction of nonprofit work to form a sustainable practice of social entrepreneurship.
Perhaps part of the issue lies in a misunderstanding of what social entrepreneurship is. In my role as a consultant in the field, I often come across clients who are taken aback by my asking for compensation – as though I should offer my services pro bono because the task at hand is rooted in the pursuit for social change. For a moment, then, let’s consider the efficacy of that purely charitable attitude in business. Nonprofit charities are notorious for their low talent retention and high executive turnover rates, and are often considered detours on a person’s professional path, rather than a final destination. Relatedly, those who work and lead nonprofits are often underpaid, overworked, and left with minimal upward mobility. Simply put, these organizations don’t offer attractive or feasible sources of income for employees, thus leading even passionate employees to leave the nonprofit in search of more sustainable employment options. As a result, nonprofits often find themselves achieving well below their potential.
But, what about those on the other side of the metaphorical divide? With their enormous talent pools and considerable resources, corporations with philanthropic interests have the capacity to enact considerable social change. However, this is rarely done; after all, a company’s focus is on making money, not a community impact. Moreover, the philanthropic efforts made by corporations are often limited in their scope and meant to look, rather than do, good. In the end, a business intends to make a profit; corporate social responsibility is only one aspect of that overarching mission.
The line dividing corporate from philanthropic interests doesn’t need to exist as staunchly as it does. Rather, a social entrepreneur is a creative innovator with the capacity and resources to identify a marginalized population and create a replicable business opportunity which helps members of the struggling group to forge a new, more tenable social equilibrium. We won’t find answers to our social dilemmas by calling for more nonprofit organizations, or by demanding more money from corporations; their structures simply aren’t built to facilitate our needs in a sustainable way. Instead, we need to encourage our young leaders to delve into social entrepreneurship, which seeks to make a mission-related impact without requiring its leaders to sacrifice their careers or compensation along the way.