Space for two? Social enterprise and charity.
As I complete my first quarter as an On Purpose Associate, I realise how quickly I have become aware, plugged in and directly involved in a variety of activities surrounding social business, social investing and social entrepreneurs. It has proven inspiring to listen, learn and work along-side businesses and leaders in such a cutting-edge environment. Yet having spent a few years working with grass-roots development NGOs, amid the excitement, I can’t help but ask what the changing landscape means for charities? Does the growing interest and resources dedicated to social innovation and social enterprise mean a crowding out of resources and funds generated for charities?
Last month, I attended Oxford Jam, a three-day event run in parallel to the Skoll World Forum on Social Entrepreneurship, [see Ben Metz’s blog below] and interestingly, a similar question was raised regarding the current state of charities. In one of my early sessions, focused on measuring impact, , a participant asked if a charitable organisation is increasingly considered a bad word when it comes to funding a project or organisation. A guest speaker from the social investment space took on the question and although avoiding a direct answer, stressed that the lines of distinction between charities and social enterprises are not always as clear as one thinks and therefore classifying one category as ‘good’ and another as ‘bad’ can prove limiting. Many social enterprises are registered with the UK Charity Commission and on the flip side several charities think and function like a business or have in-house trading arms (think Oxfam charity shops!). I found this response particularly interesting and relevant to my experiences. Prior to On Purpose, I worked with a grassroots NGO in India that applied entrepreneurial approaches to addressing problems of poverty. We had revenue-generating arm coming from the sales of rural artisan craft work, but the varied social, health and training programs administered were subsidised by a mix of aid and grants. Similar to my experience, there are associates from the 2012 On Purpose cohort working within registered charities but on financially viable, revenue-generating projects.
In one of the initial On Purpose Friday trainings, guest trainer Belinda Bell presented us with the following visual of the ‘social enterprise spectrum’ (originally created by Venturesome) to help think about the varied business models employed by social enterprises. Have a look yourself and see if you can think of a charity, organisation, or company that fits in each! *hint — think anything from Tom’s shoes, to Red Cross, to The Body Shop.
Over the last three months with On Purpose, I have found opinions, attitudes and energy to indicate that there will continue to be space for social enterprises and charities and that drawing hard and fast distinctions between the two can be difficult in practice. . It will be interesting to see how charities continue to evolve amid a changing landscape, focused increasingly on innovation, financial sustainability, results and high impact.
