We are going to start a journey, investigating the culture and the aspects of all the firms and organizations which take care not only of profits but mostly of people.
It is important to have an in-deep knowledge of firms, in order to address our interests, from purchasing interests to job-seeking interests.
Nowadays, Social Businesses are defined as those companies that have a Facebook page or Twitter account. However, this is a restricted definition, because social business should be considered as an organizational culture based on collaboration and community sense.
According to IBM (Social Business, 2012), there are three main characteristics that define a business social:
- engagement, which is a deep connection between firms and people, directly involved in operations, in order to integrate their efforts in a productive way;
- transparency of information, this increases cohesion within the firm;
- nimbleness, the ability to anticipate external opportunities and to response to threats.
We need to look behind simple definitions, social business has a deeper economic and social meaning. According to Professor Yunus (2008), social business is a non-loss and non-dividend firm whose aim is to address and to be responsive to social issues, as poverty and malnutrition. The particularity of Yunus’ social business is its mission and aim, which is not growing value shared between shareholders, but the improvement of social status.
Prof. Yunus describes principles that define a social business and that social business should follow. First of all, social business’ aim is to defeat poverty or, at least, propone solutions to this social problem; as said before, profit maximization is not an objective of the firm, so forth, investors have no claim for dividends, profits, generated after investors’ payments, is exclusively used for improvement and enlargement of the business; a social business is both socially and environmental responsible; workers are entitled to receive market level wages and to have human and decent working conditions; and, last advice, it needs to run the business with joy and passione.
There is, in business, an example of anti-social organization and strategy. Nestlè Corporation, for years, hired nurses in Africa that would have been promoting its infant formula. However, the powdered milk needs clean water, that is not easily available in Africa, this unethical marketing strategy brought many children to illness. This story can be analyzed under two forms of business thinking; according to Friedman (1970), profit maximizing objective pursued by Nestlè Corp. was right and perfectly economically justified; according to Prof. Yunus (2008), this practice is counterproductive in social terms, in fact, children come in second place after profits.
Other story for Grameen Danone (Yunus, 2009), which is a social business, and whose objective is defeating malnutrition in Bangladesh. Its business plan is around the commercialization of nutrient enriched foods at an affordable price, in order to allow also the poorest children and families to get an healthy nutrition. Grameen Danone, being a non-dividend social business, measures its own success not on the basis of stock value or generated profit, but on the basis of how many children are out of malnutrition within a year, so its success is the approaching of business’ mission.
Prof. Yunus believes so much in this approach that he is the creator and supporter of micro-credit and he founded, in 1976, the first micro-credit institution, Grameen Bank, in Bangladesh. Micro-credit has as objective the provision of economic and financial tools to persons otherwise excluded by traditional bank system.
Yunus’ founding belief of micro-credit bank is that the poor has skills and abilities that, unfortunately, cannot be expressed because of lack of trust in this category on the behalf of traditional profit-seeking banks. Credit must be considered a human right and not a privilege, the binding connection between lender and borrowers is trust in not creditworthy persons and in their businesses that constitute principal source of sustainment of poor families.
Micro-credit philosophy believes in capacity of the poor and the disadvantaged, for this, micro-credit institutions have flourished in many underprivileged parts of the world, as Africa, Mexico and India.
Grameen Bank has something like 8 million borrowers, and 97% of these are women that started a business thanks to micro finance, thanks to micro-credit over 18% of beggars that received a loan stopped to beg and became small entrepreneurs.
Through the lens of Social Threefolding principles of Steiner, social business and micro-credit can foster economic stability among society, can bring cultural initiatives and improvements to almost everyone.
Grameen Bank encourages education of children and kids, and more than 42000 students can afford
medical and engineering schools thanks to micro-finance (Yunus, 2009). Micro-finance philosophy overspread also in the richest countries, as America and Europe, to help poor people that in rich countries feel more pressure and have less opportunity of social redemption.
According to Perlas (2009), there is a new trend about micro-finance, which is strategic micro-finance. This trend has been developed first in Philippine, and it represents a creative response to the social issues, as poverty, malnutrition and illiteracy. Strategic micro-credit is used to finance both economic and cultural projects; however, be careful in not making Economics and Culture spheres overlap, and in maintaining always independent the spheres and their principles.
As we have seen, social business can be an efficient sum of social responsibility and social Threefolding, as expressed by Steiner, and can be implemented in order to reach social and environmental goals and to give a new humanity to men.
What we have to do is helping this change and make it possible for everyone.
Until our next meeting,
We need to look behind simple definitions, social business has a deeper economic and social meaning. According to Professor Yunus (2008), social business is a non-loss and non-dividend firm whose aim is to address and to be responsive to social issues, as poverty and malnutrition. The particularity of Yunus’ social business is its mission and aim, which is not growing value shared between shareholders, but the improvement of social status.
Prof. Yunus describes principles that define a social business and that social business should follow. First of all, social business’ aim is to defeat poverty or, at least, propone solutions to this social problem; as said before, profit maximization is not an objective of the firm, so forth, investors have no claim for dividends, profits, generated after investors’ payments, is exclusively used for improvement and enlargement of the business; a social business is both socially and environmental responsible; workers are entitled to receive market level wages and to have human and decent working conditions; and, last advice, it needs to run the business with joy and passione.
There is, in business, an example of anti-social organization and strategy. Nestlè Corporation, for years, hired nurses in Africa that would have been promoting its infant formula. However, the powdered milk needs clean water, that is not easily available in Africa, this unethical marketing strategy brought many children to illness. This story can be analyzed under two forms of business thinking; according to Friedman (1970), profit maximizing objective pursued by Nestlè Corp. was right and perfectly economically justified; according to Prof. Yunus (2008), this practice is counterproductive in social terms, in fact, children come in second place after profits.
Other story for Grameen Danone (Yunus, 2009), which is a social business, and whose objective is defeating malnutrition in Bangladesh. Its business plan is around the commercialization of nutrient enriched foods at an affordable price, in order to allow also the poorest children and families to get an healthy nutrition. Grameen Danone, being a non-dividend social business, measures its own success not on the basis of stock value or generated profit, but on the basis of how many children are out of malnutrition within a year, so its success is the approaching of business’ mission.
Prof. Yunus believes so much in this approach that he is the creator and supporter of micro-credit and he founded, in 1976, the first micro-credit institution, Grameen Bank, in Bangladesh. Micro-credit has as objective the provision of economic and financial tools to persons otherwise excluded by traditional bank system.
Yunus’ founding belief of micro-credit bank is that the poor has skills and abilities that, unfortunately, cannot be expressed because of lack of trust in this category on the behalf of traditional profit-seeking banks. Credit must be considered a human right and not a privilege, the binding connection between lender and borrowers is trust in not creditworthy persons and in their businesses that constitute principal source of sustainment of poor families.
Micro-credit philosophy believes in capacity of the poor and the disadvantaged, for this, micro-credit institutions have flourished in many underprivileged parts of the world, as Africa, Mexico and India.
Grameen Bank has something like 8 million borrowers, and 97% of these are women that started a business thanks to micro finance, thanks to micro-credit over 18% of beggars that received a loan stopped to beg and became small entrepreneurs.
Through the lens of Social Threefolding principles of Steiner, social business and micro-credit can foster economic stability among society, can bring cultural initiatives and improvements to almost everyone.
Grameen Bank encourages education of children and kids, and more than 42000 students can afford
medical and engineering schools thanks to micro-finance (Yunus, 2009). Micro-finance philosophy overspread also in the richest countries, as America and Europe, to help poor people that in rich countries feel more pressure and have less opportunity of social redemption.
According to Perlas (2009), there is a new trend about micro-finance, which is strategic micro-finance. This trend has been developed first in Philippine, and it represents a creative response to the social issues, as poverty, malnutrition and illiteracy. Strategic micro-credit is used to finance both economic and cultural projects; however, be careful in not making Economics and Culture spheres overlap, and in maintaining always independent the spheres and their principles.
As we have seen, social business can be an efficient sum of social responsibility and social Threefolding, as expressed by Steiner, and can be implemented in order to reach social and environmental goals and to give a new humanity to men.
What we have to do is helping this change and make it possible for everyone.
Until our next meeting,
Eleonora
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