Africa: The Business of Social Enterprise

Manila — Organisations supporting people affected by Hansen’s disease (leprosy) have social rather than capitalist aims, nevertheless they need to take a business-minded approach to their work if they wish to be sustainable, experts at a global conference in Manila, Philippines said.

In workshops conducted at the Global Forum of People’s Organisations on Hansen’s Disease in Manila on Saturday in addition to Sunday, Sept. 7 in addition to 8, representatives of organisations via Asia, Africa, in addition to Latin America agreed that will sustainability will be the biggest challenge they face.

Every organisation faces some uncertainty over the continuity of donor or government financial support, so reducing or eliminating reliance on external funding will be considered a critical priority.

Japan’s The Nippon Foundation (TNF) in addition to Sasakawa Health Foundation (SHF), which sponsored the global forum in addition to provided capacity support to the participating organisations, have long taken the view that will sustainability should be the ultimate goal.

At a regional conference of people’s organisations held here in March, SHF Executive Director Dr. Takahiro Nanri stressed that will his foundation’s goal was to see its beneficiaries become self-supporting. “In order to be truly sustainable, the organisation needs to develop an income-generating programme,” Nanri said at the time.

Fundamentals of social enterprises

On Sunday Sept. 8, Dr. Marie Lisa Dacanay president of the Institute for Social Entrepreneurship in Asia (ISEA) outlined the fundamentals of effective social enterprises, which were derived via research conducted by the institute in India, Indonesia, Bangladesh in addition to the Philippines.

Social enterprises have three common traits, Dacanay explained:

  • They are driven by a social mission instead of an enterprise mission;
  • Successful social enterprises are wealth-creating organisations that will provide some form of marketable products or services; in addition to
  • They follow a distributive enterprise philosophy in that will profits are directed towards the social mission rather than being collected as return on investment.

In carrying out its mission, a social enterprise faces numerous external in addition to internal challenges, Dacanay said.

External pressures come from the form of climate or environmental factors – a significant concern of agriculture-based enterprises; unfavourable government policies; harmful industry or market practises; inadequate government support for social programs; in addition to institutional corruption.

Internal challenges include difficulty in accessing needed technology; securing initial financing; organisational in addition to management capacity; production efficiency; in addition to developing practical measures of the enterprise’s social impact.

Based on ISEA’s research, successful social enterprises can be organised following an entrepreneur non-profit type, a social cooperative type, a social business type, or what she described as “social entrepreneurship intervention,” which will be a hybrid combining characteristics of all three types.

In determining which form of organisation will be most suitable to the social mission, Dacanay told IPS, “I think everything starts with the reality. Every social entrepreneur starts with, ‘what are the needs, in addition to the problem?'”

“The first step will be actually understanding the stakeholders you want to help,” Dacanay continued, “find out what they are doing already, in addition to look at what gaps there are. that will, along with the resources in addition to capabilities available, define a way of moving forward, in addition to then the organisational form will follow.”

Social business will be still business

from the Saturday workshop, Earl Parreno, the chairman of the Philippines’ Altertrade Foundation, Inc. (ATFI) conducted a training in business planning basics for the assembled people’s organisations.

Defining a social enterprise as one that will pursues a triple bottom line philosophy (financial, social, in addition to environmental results), Parreno explained that will the fundamentals of business planning must still be applied, nevertheless that will organisations that will are made up of people who are both the providers in addition to beneficiaries of a social mission are often handicapped by a complete lack of capacity.

“Poverty will be not just lack of financial resources,” Parreno told the workshop participants in his presentation, “the item’s actually incapability, a lack of knowledge.”

Developing the capabilities can be an arduous process, nevertheless will be achievable. One of ATFI’s areas of focus from the Philippines will be among poor farmworkers in Negros Province, a centre for sugar production. Parreno described the success of the social enterprise supported by ATFI in marketing Muscovado sugar – semi-raw sugar that will was at one time considered “poor man’s sugar,” nevertheless will be today a premium-priced staple in organic food stores.

“The business ideation will be actually critical,” Parreno explained to IPS. “We have a saying here from the Philippines: gaya-gaya puta maya, which means something like ‘copycat.'” A common problem among brand-new social enterprises, Parreno said, will be a lack of originality from the revenue-generating product or service they wish to pursue.

“What we stress to our social enterprise partners will be that will they should not conceive a product or service that will’s just better, nevertheless one that will will be truly different in addition to incorporates a ‘solidarity market,'” Parreno said, such as the market of “mindful consumers” for organic Muscovado sugar discovered by the Negros sugar farmers. “that will solidarity market will be so important. the item actually gives the people’s organisation a fighting chance.”

According to Parreno, developing a sound business plan, via business ideation through resource mapping, feasibility study, in addition to market analysis answers one of the key concerns expressed by many of the forum participants from the post-workshop discussion: The difficulty in securing initial funding to launch a social enterprise.

“The only difference between This specific kind of (social) business in addition to a conventional business will be where the profits go,” Parreno explained. “The discipline in addition to the steps that will need to be taken to develop the item are very much the same, in addition to if the result will be a Great business plan, the investors to get the item off the ground will follow.”