24/06/2018 – The Trinidad Guardian. / What is social value? This was one of the thought provoking questions posed to leaders of non-governmental and community-based organisations in Mayaro during a social entrepreneurship workshop. We all agreed that social entrepreneurship is defined as innovative, social value creating activity that can occur within or across the non-profit, business, or government sectors.
What does social value mean?
After a healthy discussion, we all agreed that possibly, the greatest challenge in understanding social entrepreneurship lies in defining what is social value.
This week’s article seeks to focus on social value in social entrepreneurship. It’s my intent that the categorisation of social value will help in understanding social entrepreneurship and lead to more informed decision making among those committed to advancing positive social change.
For social entrepreneurs, social mission is paramount, not wealth creation. This is one way of saying that social entrepreneurs’ aspirations are to increase social value. They adopt a mission characterised by values such as creating and sustaining social value (and not private benefit).
Profit is reached by serving the needs of those in needs and also by sustaining the organisation oriented through creating social value, but it must be regarded as an instrument for achieving the social objective.
Wealth creation is important so as to advance the social mission rather than shareholder value.
Another way to explain social value in social entrepreneurship is to look at it from the perspective of the commercial entrepreneurship.
For the business entrepreneur, value lies in the profit the entrepreneur and investors expect to reap as the product establishes itself in a market that can afford to purchase it. The business entrepreneur is accountable to shareholders and other investors for generating these profits.
To the social entrepreneur, there’s also value in profits, as profits are necessary to support the cause. That said, value for the social entrepreneur lies in the social benefit to a community or transformation of a community that lacks the resources to fulfil its own needs.
Although the business entrepreneur and the social entrepreneur are similarly motivated to change the status quo, their missions differ significantly. The business entrepreneur is driven to innovate within a commercial market to the ultimate benefit of consumers. If successful, the innovation creates wealth.
The venture’s success is gauged by how much wealth it creates. To the social entrepreneur, wealth creation is necessary, but not for its own sake. Rather, wealth is simply a tool the entrepreneur uses to effect social value change.
Therefore, social value has little to do with profits but instead involves the fulfilment of basic and long standing needs such as food, water, shelter, education and medical services to members of society who are in need.
The main focus, however, is on social value, while economic value creation is seen as a necessary condition to ensure financial viability.
In conclusion, my participants at the social entrepreneurship workshop came to the understanding that social value in social entrepreneurship is about paving avenues of opportunity for those who would otherwise be locked into lives without hope rather than paving avenues for personal wealth generation.
We ended the workshop with a conviction that we ought to be encouraging the social entrepreneurship movement in T&T. However, we believed we needed to be informing that movement with some clarification such as that of the meaning of “social value” in social entrepreneurship. With this understanding, why not invest in creating social value?
Nirmala Maharaj is a doctoral candidate at the UWI-Arthur Lok Jack Global School of Business. Her research is in social entrepreneurship. Mobile: 689-6539 / E-mail: [email protected]