Polina Silakova‘s sixth post in our Emerging Fellows program continues to explore the potential for a post-capitalist economy by exploring social entrepreneurship. The views expressed are those of the author and not necessarily those of the APF or its other members.
Previously, we proposed the idea that only a better system, distributive by design, will be able to replace capitalism by making it obsolete. Are there any models that could address existing market failures? Can social entrepreneurship, combining the best of business and charity, play this role?
Social entrepreneurship has taken off in recent years. According to the Social Business Initiative of the European Commission, one in four start-ups in Europe is what we could call social enterprises. One in three startuppers-to-be wants to become a social entrepreneur. Where did this boom come from? New technologies certainly offer new opportunities, while the emerging shift in values is another key reason. For today’s employees – especially millennials, who now make up more than half of the workforce – purpose at work has become more important than ever. Yet it is not always easy to find in the corporate world.
In Deloitte’s survey of 10,455 millennials across 36 countries, nearly two-thirds agreed that corporations “have no ambition beyond wanting to make money.” Is this why People & Culture consultants advise organisations to improve staff engagement by creating a “sense of purpose”? The question is though: do employers get anything in return, but a sense of engaged workforce? Fewer and fewer university graduates are buying into a post-engineered pro-social purpose of a business, originally designed purely to maximise the value of its owners. Disillusioned by the lack of well-paid purposeful roles in the public and not-for-profit sectors, more and more millennials choose to set up their own business the way they feel would be right.
Social entrepreneurs use their passion, creative talent and new technologies to address the wicked problems which most businesses are not interested to solve, and traditional public, voluntary or community mechanisms do not succeed in. This approach is also interesting in that it invites customers to become a part of the solution, potentially shifting their values as well.
Erick Jantsch in his theory of social planning suggests that when a new behavior, introduced by a group of innovators, becomes normative in a society, the values are more likely to change, too. Take a takeaway coffee cup. Some ten years ago, in Moscow, for me as a fresh graduate, getting a coffee in a single-use take-away cup was a symbol of freedom. It was a metaphor for independence of adulthood. An escape from the iron-curtained Soviet times. Coolness and confidence at the same time. What happened to the symbol after the last sip of coffee did not bother me whatsoever. Now in Melbourne, world famous for its coffee culture, I feel embarrassed to ask for a coffee in a single-use cup, of which only the lid can be recycled. It does not support the values I have developed. It does not fit my brand. With reusable cups – social innovation introduced by what you can probably call social entrepreneurs – now conquering the world, it feels irresponsible to stick to the unsustainable option.
When this initial behavioral shift happens, even if only among early adopters, behavior that used to be normative is challenged and becomes up for grabs for social change. Businesses catch up by offering a discount for customers who come with their reusable cup. If governments introduce a new legislation at this point in the change process, it won’t be seen ridiculous anymore (well, perhaps only by plastic ware manufacturers), and the shift in values will continue spreading. Fundamental changes happen when people change their minds, not when a policy dictates them. By the time my kids get into drinking coffee, I am hopeful that non-recyclable cups will only be found in museums.
In a similar way, can social entrepreneurship establish new business behaviour which, over time, will challenge the current capitalistic values? Will its pressure on the traditional economic system be strong enough to influence legislation and create tangible disruption to the businesses with “no ambition beyond money”? Does it have a potential to become the “post-capitalism thing”? And what is needed for this to happen?
© Polina Silakova 2018