So what is a social enterprise, anyway?
Social enterprise, mission-driven business, sustainable business, impact-driven business, ethical business — these are just a handful of terms you may have heard as business as a force for good is on the rise. While the split between profit-driven businesses and do-good business used to be rather cut and dry, there are more and more companies that seem to be operating in the grey area.
So how do you determine if a business is worth supporting with your hard-earned dollars or if they are just using impact as a marketing ploy?
Here are several areas where businesses are making an impact — and what to look out for.
Employment & Labor
People are at the center of most businesses, and therefore an impact model should likely factor in the people involved in the company and beyond.
This can look like many different things: employing underserved or vulnerable communities, channeling the profits into training programs for underserved populations, or even upping the standards for employees in sectors, like fashion, where workers are notoriously underpaid and employed in unsafe conditions.
It can also mean amplifying the message and work of populations that are often overlooked or underrepresented, like The Citizenry, which curates and features artisan-made home goods. Of note, it doesn’t have to be a big company employing lots of people to be relevant to this conversation, I love supporting small, women-owned businesses like Coco Bakes, an LA-based company that thoughtfully produces gluten-free and allergen-friendly baked goods.
Sustainability is a complex and layered issue and can mean so many things when it comes to business. When considering the sustainability efforts of a company, I like to check out their products, processes, and logistics.
Are they making their products using less energy, water, or toxins than other companies in their sector? Are they shipping their items efficiently, and in plastic-free packaging or recycled goods? Are they avoiding plastic as much as possible? And is a company taking responsibility for the full life-cycle of their products?
Patagonia, for example, provides repairs for items you purchased from them. The Wally Shop is a zero-waste grocery delivery service — not only do they deliver groceries in zero-waste packaging, but they buy the groceries from local co-ops and farmers markets and deliver them via bicycle and electric van to avoid carbon emissions associated with delivery. Rasa not only packages their herbal coffee in compostable bags, but ensures the herbs they work with are sustainably sourced, even if it means not using an ingredient they’d like to.
Circular model and partnerships
One-for-one and give back models seem to be becoming commonplace for large companies, but it’s important to evaluate how their philanthropic endeavor aligns with the rest of their business model. Is the company engaging in meaningful, thoughtful, and impact-driven philanthropy? How is it a circular or mutually beneficial partnership, not just a way to score “brownie points” from potential customers? For example, a company may donate 1% of their profits to a nonprofit fighting plastic pollution in the ocean, but if the company is producing products made of plastic, they are probably creating more harm than they are “offsetting” with their give-back model.
Instead, I look to organizations working directly with the community or the issue at hand. Emma’s Torch in Brooklyn, New York doesn’t just donate to organizations that support refugees, they employ and train refugees through a culinary training program — teaching a person to fish, instead of handing them one. Similarly, Soapbox Soaps donates a bar of soap to someone in need for each purchase, and the bars they donate also make an impact. The donated bars are either made by local community members in the communities they donate to, or by partners like Sundara who make soap from recycled bars of hotel soap.
When I am evaluating if a brand is truly sustainable, ethical, or mission-driven, I always like to dive a layer deeper than the marketing lingo used on the company’s homepage. Asking questions, digging into employment, sustainability, partnerships, logistics, and more will allow you to determine if a brand is making an impact. And no brand is perfect — if you are selling a product, you are likely making an environmental impact. Rather I focus on the values of the brand and if they are genuinely pushing the industry forward in a positive way, with clear goals on how to continue building towards a more sustainable and just future.
To browse more social enterprises making waves in employment opportunity, sustainability and circular partnerships check out toasting good’s brand directory.
Here are a few products we love from social enterprises creating impact in the areas Sara’s shared above:
SoapBox Soaps: For every soap product purchased, Soapbox donates one bar to a community without access to basic hygiene tools.
Greyston Bakery: Greyston operates on an Open Hiring policy, making it possible for those who face traditional barriers to employment to find meaningful work.
MPOWERD solar light: MPOWERD is committed to making renewable energy usage widely accessible. They also donate a significant amount of product to communities rebuilding after natural disasters.