Practicing Liberalitas in Business: The Rise of the Social Enterprise
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Liberalitas, the virtue of giving freely, formed the backbone of social cohesion in Roman society. Roman poets and philosophers, such as Cicero and Seneca, argued that liberalitas was a responsibility of the affluent, from minor nobility to the emperor. An emperor displayed his generosity to constituents through the distribution of money and provisions. During seasons of surplus, a proportion of profits were redistributed and given back to each constituent. Liberalitas maintained not only the community, but also the bonds between individual, commerce, and state. We can take liberalitas one step further by infusing social good into businesses’ core values.
Applying Liberalitas in Modern Day Society
While emperors no longer exist, the virtue of liberalitas can and should be practiced by business leaders, government officials, and individuals. Incorporating liberalitas into a business’ mission can have a ripple effect. Individuals whose lives are transformed as a result of compassionate business leadership also choose to dedicate their success into helping others. By targeting one social issue through a balance of business and liberalitas, society can indirectly tackle a host of related issues. For example, the Kashf Foundation not only provided 500,000 Pakistani women with $265 million in loans, but also educated women with training, and employment opportunities. Furthermore, the Kashf Foundation’s work has helped tackle food insecurity, poor infrastructure, and emigration.
Traditionally, business and generosity are often been seen as incompatible, playing separate roles within society. Corporations exist to drive profits, whereas non-profits exist for charitable giving. However, there is a push to widen stakeholder values in businesses to include social and environmental governance. This trend towards “triple-bottom line thinking” has led to the evolution of benefit corporations. A benefit corporation is a legal type of corporation recognized by 28 states with legally protected requirements of higher purpose, accountability and transparency. Benefit corporations are slightly different than B corporations. Any for-profit entities can be certified as B corporations by B Lab, a non-profit organization that evaluates companies on social and environmental performance, public transparency, and legal accountability.
There has been a push to widen stakeholder values in businesses to include social and environmental governance. This trend towards “triple-bottom line thinking” has led to the evolution of benefit corporations.
Benefit corporations are on the rise and are quickly shifting the business paradigm. Since 2006, 60 percent of all US social enterprises have been founded. Richard Branson, a successful for-profit businessman, launched the B Team, a global non-profit initiative that gathers global leaders from business, civil society, and governments to catalyze corporate change and prioritizes people and the planet. Popular brands, like Ben and Jerry’s and Patagonia, qualify as B corporation certified.
Benefit corporations also provide tangible financial returns. On average, benefit corporations generate $2.23 in benefits for every dollar invested. These returns have decreased reliance on welfare and increased income in the geographic areas in which these corporations operate. The Great Social Enterprise Census found that social enterprises employ 14,000 workers and make up around 3 percent of the US GDP. The emphasis on conscious core missions in businesses will continue to shift the business paradigm, sparking a new era of compassionate leaders and social enterprises.
Liberalitas is dedicated to understanding the minds of compassionate business leaders. Stay tuned for upcoming interviews with social entrepreneurs changing the landscape of business.
