I used to think cheques were so cool when I was a kid. Sadly, once I got old enough to have an account – cheques were completely out of favor. However – in India they are still used, so with my newly opened account I now have a cheque book! Yay! Only problem remaining is someone to actually write a cheque too. Damn.
A recent article I read as part of the preparation for our CEO’s attendance at the Skoll World Forum, got me thinking of one of the discussions that I’ve had with the other fellows and people I know about social business. The discussion basically questions if there really is such a thing as “social” business? Isn’t in the end business, when it comes down to it, always about making money? Will the incentives not always be there to seek profit as opposed to social impact? Vice-versa, if the social impact motive is there – will the business not loose out and become unsustainable?
The article in question was calling for new legal and corporate structures
, to address parts of this issue, saying that with the appropriate governance structures the incentives can be aligned and external stakeholders such as program participants, funders and supporters can be re-assured that what they’re actually standing behind is indeed on proper “social” ground.
While working with Waste Ventures, I have been seeing quite how complicated this can get for a hybrid social enterprise – understanding the structure that we have been building can be tricky at times, with a combination of charity and for-profit entities. A simpler way of doing it, with alternative corporate formats might indeed help enterprises like us along.
However – I always get the feeling that corporate and legal structures can’t quite cover the whole issue, and while they are necessary, I do think there is a fundamental question that needs to be answered – is it in fact so that in the end all corporate organizations will divert to focus on profit as opposed to impact (and is that even a bad/unwanted
thing?!) and if not, what is required from the founders, the corporate structures, the governance and the ways the businesses are set-up to retain the social mission focus?