Creating social value has been a long-lasting concept in the history of enterprises. Since almost 20 years the term “Social Entrepreneurs” has become quite popular. As a result, more and more researchers, as well as companies, deal with the topic of social impact. However, with the rise of SE, many companies use the positive association of the term as an image boost. In a survey of oikos Social Entrepreneurship, many students proved to be skeptical regarding the truthfulness of self-titled sustainable and social entrepreneurs. Taken that into account, people are seeking a clear definition of SE.
For Prof. Dr. Grichnik, the definition of SE is quite clear. He states that the main difference between a traditional company and a social one lies within the purpose and business model of an enterprise. It is possible to have more than one purpose but as long as the main purpose and the business model based on it is social, the entrepreneurship can be classified as a SE. For instance, a company with the purpose of making a profit through clothes sales, but employs 15% of disabled people, would not fall under the category “social enterprise”. However, if the purpose would be to decrease unemployment rates by giving disabled people a job, then it can be considered as a social enterprise.
Are we now in a generation-turnover? On the one hand, there are still many old companies with long-lasting business models to maximize their shareholder value without considering social impact. On the other hand, there is a significant trend towards SE apparent, especially among the young generation. Many young entrepreneurs establish innovative ideas to change the world in a positive way. Prof. Dr. Grichnik has also observed an increasing interest in SE among the students of recent generations. They are more self-critical, willing to make an effort and aware of their possible impact. Furthermore, technologies nowadays allow more simplified and scalable solutions for social issues.
Read the entire article on the website of the by HSG students organized EVOLVE Conference.