HISTORY OF SOCIAL ENTREPRENEURSHIP
~By- Vidhu Mittal
Entrepreneurship saw increasing popularity with the onset of the Startup Culture enabled by the Make in India campaign that started in 2014. Today, over 50,000 startups exist in India, of which almost 20% are technology-led companies. But, the majority of these companies are for-profit enterprises, i.e., they are providing a service or selling a product through which they earn money. The main goal of these organizations is to satisfy customer needs and earn more profits. Although there is nothing wrong with this idea, they do not necessarily solve a problem that affects society as a whole or address something that caters to the less fortunate sections of our society. So, are there any organizations that solve societal issues through innovative, entrepreneurial ideas? The answer is YES, and this form of Entrepreneurship is called Social Entrepreneurship.
What is Social Entrepreneurship?
The term “entrepreneur” was invented by Jean-Baptiste Say, a French economist. He described an entrepreneur as someone who puts an idea into action and alters attitudes in a way that has an impact on society. According to Say, an “entrepreneur” is someone who “shifts economic resources into areas of higher productivity and greater yield.” The contrast between an entrepreneur and a social entrepreneur, on the other hand, arises from the goal of creation. Social entrepreneurs attempt to alter communities as a whole, rather than profit, as most entrepreneurs do. They employ a range of resources to improve the well-being of civilizations.
So several questions must arise in your mind, like how did such enterprises come up? What is their history, and what kind of issues did they address over the years in different countries, particularly in India? So let’s dive into the history of Social Entrepreneurship and try to know more about it.
History of Social Entrepreneurship
The concept of “social entrepreneurship” is not a novel idea, but since the beginning of the 21st century, it has become more popular among society and academic research, notably after the publication of the book, “The Rise of the Social Entrepreneur’’ authored by Charles Leadbeater. A lot of activities related to community development and higher social purposes can be linked to the modern definition of social entrepreneurship. Despite its formal modern definition, social entrepreneurship has remained to be a difficult concept to define, since it may be described in multiple forms. A broad definition allows interdisciplinary research efforts to understand and challenge the notions behind social entrepreneurship. Irrespective of the sector of society in which certain organizations fall, social entrepreneurship focuses on the social impact that an endeavor aims at. Whether social entrepreneurship is altruistic or not is less important than the effect it has on society.
In the United States of America, the history of social entrepreneurship dates back to the ’70s. It all started after the soaring of oil prices in 1973 which brought an economic downturn and led the government to cut the funding on social welfare. Consequently, the social entrepreneurial movement in America was supported by an ecosystem provided by private foundations and academic institutions as well as a cultural context characterized by the prominence of business approaches.
The rise of Social Entrepreneurship has been observed in countries worldwide. Social Entrepreneurs in different countries came up to solve problems that were affecting their societies. Let us take a look at some social enterprises that emerged around the world and what problems they solved for their community, and even worldwide.
The concept of “social entrepreneurship” is not a novel idea, but since the beginning of the 21st century, it has become more popular among society and academic research, notably after the publication of the book, “The Rise of the Social Entrepreneur’’ authored by Charles Leadbeater. A lot of activities related to community development and higher social purposes can be linked to the modern definition of social entrepreneurship. Despite its formal modern definition, social entrepreneurship has remained to be a difficult concept to define, since it may be described in multiple forms. A broad definition allows interdisciplinary research efforts to understand and challenge the notions behind social entrepreneurship. Irrespective of the sector of society in which certain organizations fall, social entrepreneurship focuses on the social impact that an endeavor aims at. Whether social entrepreneurship is altruistic or not is less important than the effect it has on society.
In the United States of America, the history of social entrepreneurship dates back to the ’70s. It all started after the soaring of oil prices in 1973 which brought an economic downturn and led the government to cut the funding on social welfare. Consequently, the social entrepreneurial movement in America was supported by an ecosystem provided by private foundations and academic institutions as well as a cultural context characterized by the prominence of business approaches.
The rise of Social Entrepreneurship has been observed in countries worldwide. Social Entrepreneurs in different countries came up to solve problems that were affecting their societies. Let us take a look at some social enterprises that emerged around the world and what problems they solved for their community, and even worldwide.
Goodwill Industries
In 1902, a Methodist Minister in Boston, USA started collecting old clothes and other essential items and then hired poor workers to help repair those goods. He then sold these repaired items back to the same workers at affordable prices. Almost 100 years later, Goodwill Industries is a $4 billion non-profit with over 160 stores across the US and Canada. He believed in the motto: A hand up, not a handout. Goodwill describes Rev. Edgar J. Helms as an “early social innovator”, who saw an issue in his society and came up with a unique solution to address it.
Ashoka
Ashoka is a non-profit organization based in the US. The organization promotes social entrepreneurship by connecting and supporting individual social entrepreneurs. Their mission is to create an association of the world’s leading social entrepreneurs that have solutions and ideas to solve the world’s most urgent social problems and also to foster a global culture where everyone is a changemaker for the good of all. Founded in 1980 by William Drayton, Ashoka has almost 30 subsidiaries around the world that help social entrepreneurs in that region. Growing up, William Drayton has always been inspired by Mahatma Gandhi’s struggle for India’s Independence and also the Civil Rights Movement of America. He aims to solve the issue of income inequality through social entrepreneurship.
Acts introduced by the Indian Government
In the 19th century, the Government of India (the then British-Indian government) introduced two acts — the Societies Registration Act of 1860 and the Indian Trustees Act of 1882 — which were aimed to regulate and provide legal status to non-profit enterprises which existed for the benefit of the society. The SRA was introduced to provide legal status for societies and enterprises that were promoting education in various fields and the development of public institutions like libraries and museums. Whereas, the ITA was introduced to support charitable entities that aim to address several social issues like education, poverty, medical infrastructure, etc.
Indian Independence Movement
The Indian Freedom Movement, led by Mahatma Gandhi, saw the idea of social transformation of villages ingrained in the essence of freedom at the turn of the 20th century. The concept of freedom promoted by the country’s forefathers included a strong emphasis on developing an empowered grass-root society, as well as a strong emphasis on developing social leaders who can facilitate the growth of self-sufficient village-level communities capable of empowering their stakeholders. The Gandhian philosophy of “trusteeship” (i.e., business is a trustee, not the owner, of the riches of society) emphasized economic equality and societal empowerment. It impacted not just a significant number of industrialists at the time, but it also became a guiding philosophy for many large social projects in the United States.
It not only impacted a significant number of businesspeople at the time, but it also became a guiding philosophy for many large social projects in post-independence India. Even after India attained independence in 1947, many of Gandhi’s supporters kept on to create an empowered society, inspiring many young people to work in the development/social sector.
ATIRA
Another example of Social Entrepreneurship in India is ATIRA. Ahmedabad Textile Industry’s Research Association (ATIRA) is an autonomous not for profit organization for textile research located in Ahmedabad, India. It was established by Dr. Vikram Sarabhai, a great Indian physicist and astronomer in 1949. ATIRA is the largest association for textile research and allied industries in India. ATIRA was recognized by the Council of Scientific and Industrial Research under the Ministry of Science and Technology, Government of India. It was later merged with the Ministry of Textiles, Government of India.
The aim and motivation of ATIRA was to promote the development of the textile industry in India through research, innovation, and technology adoption. ATIRA’s research and development activities have had a significant impact on the Indian textile industry, particularly in the city of Ahmedabad. ATIRA helped in employee generation through its development and research activities. It led to the creation of new businesses and also supported the growth of smaller local businesses. It helped in improving the quality of textile products, and promoted Sustainable Textile Production, focusing on adopting eco-friendly production processes that reduce wastage and also help the environment. These practices increased the revenue of the textile mills, and these profits were used to increase workers’ wages, improve their lifestyle, educate the children of the workers, and build better healthcare infrastructure for the workers.
Conclusion
Social entrepreneurship is quickly expanding in size, breadth, and support today. Numerous organizations are leveraging entrepreneurship to solve social issues such as poverty, at-risk kids, hunger, water scarcity, housing, education, healthcare, etc. Social entrepreneurs are creating new and creative organizations that provide individuals with the skills, knowledge, and resources they need to become entrepreneurs. They may serve their communities as entrepreneurs by increasing health, eliminating hunger, creating safer surroundings, and providing access to clean water.
