MGT6027 Social Enterprise Notes

Learning Outcomes

By the end of the session, students should be able to:

  • Explain the concept of social enterprise in their own words and differentiate it from conventional business practices.

  • Provide definitions of social enterprise from external sources.

  • Discuss the motivations that drive social entrepreneurs.

  • Identify societal and environmental challenges that social enterprises aim to address.

Traditional View of Business

  • Historically, businesses operated with a focus on maximizing profits for shareholders.

  • Contemporary shifts in perspective:

    • Transition towards enlightened shareholder value considers broader stakeholder interests beyond profits (Nwafor, 2014).

Corporate Social Responsibility (CSR)

  • Definition: CSR involves the ongoing commitment of businesses to operate ethically while improving community quality of life and pursuing economic growth.

  • Key Objectives of CSR:

    • Balancing the interests of profits, people, and the planet to enhance reputation and profitability.

Societal and Environmental Challenges

  • These challenges are often complex and interconnected, described as 'wicked problems':

    • Examples include environmental degradation, terrorism, and poverty.

    • Addressing these issues involves risks and potential unintended consequences.

  • Characteristics of wicked problems:

    • Difficult to define or solve.

    • Have numerous causes and no straightforward solutions (Harvard Business Review, 2008).

Social Enterprises as Solutions

  • Purpose: The primary goal of social enterprises is to tackle specific social or environmental issues.

  • Examples of CSR Policies:

    • Equal opportunity initiatives.

    • Environmental policies, including recycling.

    • Fair trade policies.

    • Charitable donations.

    • Supply chain standards.

Module Aims

  • Explore both the theory and practice of social enterprises.

  • Equip students with skills and interests necessary to become social entrepreneurs.

  • Illustrate the broader socio-economic environment impacting social entrepreneurship.

  • Discuss common policy, regulatory, and practical issues faced by social enterprises.

Emergence of Social Enterprise in the UK

  • Originated from:

    • Left-wing movements influencing cooperatives and community development.

    • Government funding changes allowing social enterprises to compete for public sector contracts.

  • Function as a mechanism for economic growth, social cohesion, and tackling deprivation.

Motivations of Social Entrepreneurs

  • Engage with TedTalks by notable social entrepreneurs to understand their motivations.

  • Group activities to discuss and analyze their insights.

Four Elements of Social Enterprise

  1. Social Mission: Prioritizing social objectives over financial returns.

  2. Innovative Solutions: Developing unique approaches to social challenges.

  3. Self-Sustaining Business Model: Creating profitability without compromising social goals.

  4. Measurable Impact: Assessing the effects of interventions and progress towards goals.

Key Terminology Review

  • Social Enterprise: Business with a social or environmental goal.

  • NGO: Non-Governmental Organization, typically focused on humanitarian or social issues.

  • Cooperative: Organization owned and operated for the benefit of a small group of individuals.

  • Corporate Social Responsibility: Business model based on sustainable and ethical practices.

Conclusion

  • Next session will focus on the context of social enterprise and introduce the first assessment.