Are You an Accidental Social Enterprise?

Many business owners, boards, and stakeholders may not realise they are already operating as a social enterprise. Social enterprises aim to have a positive community impact, not just maximise profits. According to Centre for Social Impact , a social enterprise has an underlying mission of creating social or environmental change. This differs from a traditional business focusing solely on making money.

There is a spectrum when it comes to social enterprises. On one end are charities and non-profits dedicated fully to creating positive change through reinvesting profits. On the other end are traditional businesses seeking profits first while considering social impact second. In the middle is a blend - of purpose-driven organisations wanting to do good through services, products, or employment initiatives that also generate revenue.?

Legally, there is no formal business structure for a social enterprise in Australia. They can adopt various legal frameworks like a standard company or partnership. What defines them is their core mission. Their profits get reinvested to further their positive goals, not mainly pad shareholder pockets. Their metrics track social impact, not just financial returns.

This matters because consumers and employees now care deeply about organisational purpose and ethics. They want to engage with brands that align with their values. As such, every enterprise today should evaluate itself on the social spectrum - are you accidentally a social business already??

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The Three Types of Social Enterprises

There are three general types of social enterprises based on their core mission and how they utilise profits:

1. Social Impact Focused: Most or all profits go back into furthering positive community change. Examples are disability employment providers and shelters.

2. Mixed Model: Significant focus on social good with a portion of profits still distributed to owners/shareholders. Examples are cafes employing at-risk youth or sustainable manufacturing plants.?

3. Socially Conscious Businesses: These track social impact but distribute most profits to owners. An example is a private school company with special needs scholarship programs.

As shown, there is no clear line - more a continuum of emphasis between profits and purpose. Any enterprise can evolve its model to shift closer toward social impact goals.

Maximising Community Value, Not Just Profits

Unlike a charity, social enterprises are not restricted to making profits. However, there is an ethos of responsible growth tied to purpose, not maximum profits at any societal cost. Social enterprises track two metrics - private value to owners and public value to the community. As they scale, the focus is balancing the two, not just ever-increasing the first.

Most social enterprises readily reinvest surpluses as they grow. There are also emerging legal options like becoming a B Corp which necessitates tying company goals to positive social and environmental outcomes beyond shareholder profit.?

In summary, many organisations today likely already implement social enterprise principles without actively carrying the label. By consciously tracking collective metrics beyond financials, and re-investing gains responsible back into environmental/societal goals, any business can shift towards this rapidly emerging middle-ground model. The potential benefits to staff, customers and community are vast.

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SO YOU WANT TO CHANGE THE WORLD THROUGH BUSINESS?

Pitch to get support, request a proposal or enter one of our accelerator programs as the first step on your journey to building or scaling your social benefit supplier organisation or venture.

We are here to enable and support you to create transformative change and meaningful positive social and environmental impacts. Through expert consulting on strategy, operations, technology adoption, and more - One10 Group helps social enterprises capitalise on trends like these to maximise impact.

Contact our team at [email protected] to explore collaboration driving positive change or Apply for one of our programs.

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Author

Dr Dr Abhijeet Kashyap

As a committed healthcare professional, Dr. Abhijeet Kashyap draws on over 2 years of experience as a General Practitioner (GP) and healthcare administration. Concurrently, he is advancing his business acumen by pursuing an MBA at Swinburne University of Technology.

Leveraging his refined analytical thinking from complex healthcare settings, he aims to develop innovative solutions across industries and cultivate a versatile skill set encompassing communication, writing, presentation delivery, research, and organisational understanding.

By integrating healthcare insights with management consulting best practices, Dr. Kashyap aspires to become a healthcare strategy consultant. His goal is to contribute to impactful international entities like the United Nations, driving improvements in global health outreach.

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