Social enterpreneurs have always existed. But in the past they were called visionaries, humanitarians, philanthropists, reformers, saints, or simply great leaders. Attention was paid to their courage, compassion, and vision but rarely to the practical aspects of their accomplishments. Thus, people may know about the moral teachings of St. Francis but not about how the Franciscans became the fastest growing religious order of its day.
...social enterpreneurs are said to create value which is social. Whatever it is, it benefits people whose urgent and reasonable needs are not being met by other means. This output appears to strike the majority as so obvious that it has evaded much comment.
Social entrepreneurs are different from business entrepreneurs in many ways. The key difference is that social entrepreneurs set out with an explicit social mission in mind. Their main objective is to make the world a better place...creating social value does not necessarily lead to long-term rewards for the enterprise or entrepreneur creating it.
The crisis of the traditional welfare state, characterized by a general slowdown in national economic growth rates and high unemployment, has been accompanied by a deep reconsideration of the social strategies employed by the governments. This sparked, for example, the trend of privatization and decentralization that was so common in public policy during the 1980s.
In 1993, Harvard Business School launched the 'Social Enterprise Initiative', one of the milestones of the period. Since then, other major universities - including Columbia, Stanford and Yale - and various foundations have set up training and support programmes for social enterprises or social entrepreneurs.
A social entrepreneur identifies and solves social problems on a large scale. Just as business entrepreneurs create and transform whole industries, social entrepreneurs act as the change agents for society, seizing opportunities others miss in order to improve systems, invent and disseminate new approaches and advance sustainable solutions that create social value.
Grameen Bank (GB) has reversed conventional banking practice by removing the need for collateral and created a banking system based on mutual trust, accountability, participation and creativity. GB provides credit to the poorest of the poor in rural Bangladesh, without any collateral.
As of October, 2011, it has 8.349 million borrowers, 97 percent of whom are women. With 2,565 branches, GB provides services in 81,379 villages, covering more than 97 percent of the total villages in Bangladesh.
The average social enterprise employs 10 people but nearly half employ fewer than 10, 38% employ between 10 and 49, 11% have 50-249 employees and 2% employ more than 250. Traditionally, sole traders are few and far between in the social enterprise community.
Social enterprises also commonly derive their main income from ‘community or social services’ (21%) and property (20%). A much smaller percentage of social enterprises trade in the educational sector (15%) or wholesale and retail (3%).
The idea of social entrepreneurship has been around since the 1960s, becoming more popular in the 1990s. Anyone with a good memory for business and who has taken a course in business ethics will remember Milton Friedman's classic criticism of this idea in his 1970 New York Times Magazine article, “The Social Responsibility of Business is to Increase its Profits.” Friedman argued that executives should not divert profit from stockholders to social causes. The primary reason is that the money belongs to the shareholders to spend as they see fit.
A 2005 survey by the U.S. Chamber of Commerce reported that 81% of business executives believe that "corporate citizenship" should be a priority, and 75% report their businesses are actively involved in bettering their communities. In a 2006 survey of MBA students by Net Impact, 81% thought businesses should work toward the betterment of society.
Globally, social business enterprises are active mainly in the social, environmental, human rights and gender equality areas. Examples include: street children; children’s health; health insurance for disadvantaged people; housing; educational opportunities; poverty in degraded urban areas; ageing and the elderly; migrants and ethnic minorities; work and employment; climate crisis; pollution problems; clean drinking water; empowerment of women; human rights; gender equality; digital divides.