Social Business And Philanthropy – Is There Room For Both?



by Michael Harris - October 9, 2013

Delegate from the United Kingdom, Michael Harris' takeaways from the One Young World Summit 2013 in Johannesburg, South Africa.

 

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In Johannesburg, Unilever's CEO Paul Polman summed up our predicament neatly to a room of 1,250 young leaders from across the globe: “Never before has a generation faced such devastating problems,” but crucially in the same breath “never before has the same generation had the tools to fix them.”

 

 

Our planet’s climate is in flux and the number of climate refugees is expected to reach hundreds of millions within a generation. There are a billion people malnourished and another billion overweight. 57 million children globally still do not have access to schooling. Global youth unemployment is growing by 4 million every year. Basic human rights are still a privilege afforded only to a lucky proportion of our globe. You don’t have to be shiniest spoon in the cutlery drawer to acknowledge that there is a lot of work to be done.

At the One Young World Summit 2013, these same young leaders heard the compelling case for ‘social business’ to battle these endemic human problems. The world’s first social banker Muhammad Yunus told us: “social business needs to be at the heart of development” and the world’s leading financier Antony Jenkins of Barclays emphasised the importance of running a company by 'doing the right thing' (incidentally, 'doing the right thing' is a phrase central to my employer, PwC, who are also doing important work to support and build social enterprises in the UK). The launch-pad has been set, the era of social business is soon to reach lift-off and it is my generation who will assume the pilot’s seat.

 

 

Despite the optimism that such an opportunity represents, there are some pressing challenges to overcome. How do we shift from an economic system that values purely financial wealth creation to one that values environmental and social wealth creation too? How do we bring everyone along with us when dollars mean everything in tough times? How do we utilise our planet’s finite resources responsibly without stifling the innovation required to get us out of the hole?

I’m particularly interested in whether, once we have moved to a model where social good is integrated into the business model, charities and the simple generosity of others will no longer be relevant. Of course, most people will see this scenario as a good thing, and rightly so. Social business will result in sustainable solutions to our most intransigent problems. Even so, we should lend our thoughts to both the short and long term effects of this scenario.

In the short-term, a move towards social business will not render our charities irrelevant overnight. On the contrary, the funding gap for charities in the UK reaches into billions of pounds and these are organisations that provide vital public services where the government’s wallet runs out – think hospice nurses, medical research, skills training, and care services. So whilst we should dive in to social business and shake up the status quo, we are obligated to re-double our responsibilities in the meantime by continuing to give, and to give more.

Even the most idealistic of visionaries would concede that the charitable space is always likely to fill some service gaps regardless of the proliferation of social business. However, for the sake of argument, let us suggest that charities become obsolete by 2050. Will social business and the formalisation of ‘doing good’ deprive people of the special opportunity to give and receive?

This will be a nice problem to have, for sure, but an interesting dilemma nonetheless. Either way, let us not falter from building exciting and impactful social businesses whist continuing to give as much as we can to the most effective charities - whilst we still can.

 

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