International Social Entrepreneurship

Joseph Mark Munoz

• Publisher: Business Expert Press
• Year: 2010
• Print ISBN: 9781606491065
• eBook ISBN: 9781606491072
• Topic: Business
• Subtopic: International Business
• Index: Business

The book is attractive to the target readers for the following reasons: 1) there has been a growing interest in the topic of social entrepreneurship and yet there are limited academic materials, this book will offer a concise, straight-forward compilation of theories, concepts, and cases, 2) with globalization, students and executives have been empowered to make positive impact around the world; this book will identify and discuss viable strategies, 3) in today's business environment, many students and executives have been responsive to global issues, this book will provide fresh insights on citizenship in a global environment.

Chapter 1

Introduction

No man or woman of the humblest sort can really be strong, gentle, and good, without the world being better for it, without somebody being helped and comforted by the very existence of that goodness.

—Alan Alda

Global business has redefined contemporary ways of life and the conduct of business. It sped up business processes, stimulated innovation, and opened several gateways to prosperity. It intensified cross-border communication and interaction and unified cultures. It set new frameworks for global citizens to engage, collaborate, and find meaning in life.

Globalization has brought the world closer together. It allows everyone to instantaneously gather information and reach out to friends and colleagues in distant places. With cable television, news events from remote corners of the world are broadcasted instantly. With breakthroughs in telecommunications, computers, and the Internet, collaborating with others has been immensely simplified. With advancements in the travel and transport industries, foreign travel, service delivery, and the movement of products have become affordable and accessible to many.

Globalization reconfigured the business paradigm. The heightened integration has been attributed to (a) lower transportation and communication costs arising from sprouting technologies, (b) trade liberalization across several fronts, and (c) more aggressive business endeavors in developed and developing countries.¹ Globalization created a new economic order, and facilitated access to factors of production and new markets, amid heightened global competition.² In the view of Pulitzer prize–winning author Thomas Friedman, our world is decidedly “flat.”³

The global world empowers every individual, corporation, organization, and government entity to make an international impact. Markets, nation-states, and technologies are deeply enmeshed and let everyone reach out to others in a faster, farther, and deeper manner.⁴ Through friendships, businesses, and sociocivic pursuits, significant changes are doable in far corners of the world.

Actions pursued by individuals and corporations have changed societies on foreign shores. For instance, Muhammad Yunus’s Grameen Bank led to the expansion of microlending that helped millions of struggling poor people in emerging nations. Bill Drayton’s Ashoka Foundation supported thousands of entrepreneurs in international locations and consequently improved many communities.

The ability of individuals and corporations to make an international impact is often subject to “push” and “pull” forces. Push forces refer to factors that facilitate the outward, international expansion of companies. Pull forces refer to factors that encourage and draw investments into host countries. Examples of push forces that drive internationalization include home-country policies and trade restrictions, technology, transport and communication efficiencies, Internet and enhanced distribution systems, telecom improvements, economic changes, market forces, and even growing cultural homogenization. Examples of pull forces include attractive resources and policies in host countries that lead to cost benefits, market expansion, operational gain, tax breaks, and relevant incentives. Individuals and organizations seeking to explore opportunities overseas need to deliberate these factors.

Organizations exploring foreign marketplaces have different motives. In their research, authors Mauro Guillen and Esteban Garcia-Canal⁵ identified several motivational factors for foreign direct investment by multinational enterprises, including (a) links to resources, (b) access to international markets, (c) overcoming home-country government restrictions, (d) enhancing risk management, (e) moving resources to diversify investment portfolios, (f) following competitors to foreign locations, (g) overcoming trade liberalization and related policies from the home country, (h) access to asset-resource acquisition opportunities, and (i) optimizing use of firm, intangible assets.

Many countries are aggressively working on the “pull” factors in order to attract investment. They are instituting policies, procedures, and guidelines that facilitate global trade. Tariff reductions are a growingly common measure. Many countries seek to ensure that their legal systems, infrastructure, tax laws, and exchange rates are attractive to overseas investors.

The interplay of the push and pull of global forces has redefined the agendas and relationships of individuals, corporations, and countries. For instance, many corporate executives and businessmen engage in outsourcing and creative strategic alliances in emerging markets; multinational corporations scour the world for new opportunities while countries and many governments embrace privatization to attract investments.

Amid heightened global integration and international trade expansion, challenges exist. While many individuals, companies, and governments have benefited from globalization, millions have been left out of the loop. While many have found a gateway to prosperity, millions struggle with poverty, disease, pollution, and other social challenges. The process of globalization is not entirely balanced, and complacency and lack of concern for the welfare of others can lead to more pressing problems in the future. In the view of Professor Russel Botman, globalization tends to spawn individualism and may lead to the loss of community spirit within and among countries.⁶ Competitive pressures, motivation for financial gain and survival, and the push for constant excellence may lead to an emphasis on personal gain rather than the needs of the society.

Globalization therefore opens up a new set of questions for its citizens:

1. Has technological breakthrough, international integration, and newfound prosperity enhanced our outlook of the world?
2. With expanded global relationships, have we become more compassionate, caring, or humane than generations before us?
3. As members of the now global community, what have we and our companies contributed?

The success of a society largely rests on the contributions of its members. In recent years, the global community has been fortunate to be a recipient of the gifts of talent and resources from change makers who strive to positively impact the world.

Socially inspired citizens are bringing about notable changes to communities worldwide. Author David Bornstein observed that in the realm of public service, internationalization is taking place in an unprecedented scale, is growingly diverse, and is comprised of dynamic interorganizational alliances that are implementing innovative solutions to social problems.⁷ In past decades, civic consciousness and community spirit were awakened in many as a response to events and natural tragedies such as floods, earthquakes, famine, and disease. However, in recent years, involvement in humanitarian causes has expanded through the creation of organizations responding to various forms of self-made misery often created by humankind.

Among the socially oriented citizenry, a distinct group has opted to engage in the practice of social entrepreneurship. Author Alan Fowler defines social entrepreneurship as the “creation of viable socio-economic structures, relations, institutions, organizations and practices that yield and sustain social benefits.”⁸ The Social Enterprise Alliance defines social enterprises as “organizations that achieve its primary social and environmental mission using business methods.”⁹ In an email correspondence with Dr. Rebecca Harding, managing director of Delta Economics, she stated, “These organizations are set up to pursue social, community, ethical or environmental goals and redistributes revenues and surpluses to fulfill those goals.”¹⁰ Authors Sandra Waddock and James Post describe social entrepreneurs as “private sector citizens who play critical roles in bringing about ‘catalytic changes’ in the public sector agenda and the perception of social issues.”¹¹ The Ashoka Foundation, a leading social enterprise, characterizes the breed as “practical visionaries” who possess vision, innovation, determination, and long-term commitment to social change.¹² These unique individuals enhance social value, exercise fair and virtuous judgments, and strategically and creatively tap into opportunities that lead to reform.¹³

In recent years, the business world witnessed the emergence of social entrepreneurs. For instance, in the United States, Wendy Kopp founded Teach for America, an organization that provides college students the opportunity to serve communities by becoming teachers in various locations across the country.¹⁴ A company called YouthBuild was formed to help marginalized youths earn diplomas, learn skill sets, and engage in community service by helping build low-cost homes.¹⁵ A nonprofit enterprise known as KaBOOM expanded rapidly and attracted millions of dollars from donors to develop playgrounds for local communities.¹⁶

While social entrepreneurship has been active in the United States, similar trends are taking place in other parts of the world. In Africa, Martin Fisher and Nick Moon started an organization called KickStart. The company identifies and markets innovative technologies in the region and sells them to local entrepreneurs, thereby providing a win–win scenario where the inventor earns, the businessman makes money, and the community benefits from the innovation.¹⁷ Paul Farmer founded Partners in Health, an organization that provides affordable treatment solutions in addressing health issues in developing countries.¹⁸ In the United Kingdom, a successful social enterprise known as Guide Dogs for the Blind Association (GDBA) breeds and trains Seeing Eye dogs, thereby catering to a social need while gaining profit.¹⁹

Many social enterprises have taken on creative pursuits with missions that have high community impact. For instance, Divine Chocolate ensures that cocoa purchases for their chocolates are acquired via fair trade;²⁰ Big Issue is a newspaper company that lets homeless people sell their newspapers;²¹ Housing Works runs thrift shops, a book store, and a catering company, among other businesses, to support their mission of fighting AIDS and homelessness;²² Rubicon uses research, science, and education to support divers, aviators, and researchers worldwide;²³ Community Wealth Ventures provides social enterprise consulting;²⁴ and Social Enterprise Reporter provides news and reports for the social enterprise and related sectors.²⁵ There are many other examples engaged in diverse industries. Social enterprises are noted in sectors such as retail, service, and manufacturing; social services; research and consulting; community development; finance; and technology.²⁶

While many social enterprises are start-ups, some have been established by proven and tested entrepreneurs. For instance, internationally renowned entrepreneurs, like Jeff Skoll of eBay, Bill Gates of the Microsoft Corporation, and Richard Branson of Virgin Group, engaged in social entrepreneurship after a successful career in industry. Later in life, they responded to a social call by creating ventures that positively impact society. They set up foundations or grant-giving entities that aid international communities, and they support the growth and expansion of social entrepreneurship.

Enterprises that are both socially driven and profit driven are expanding.²⁷ The concept and practices behind social enterprises are not entirely new. In the United States, elements of social enterprise thinking have been observed in years past and were visible in community activism, civic campaigns, and even political movements.²⁸ In the United Kingdom, even years ago, sociocivic programs that focused on job creation were observed.²⁹ At the present time, social entrepreneurship is gaining popularity in the United States and United Kingdom.³⁰ The number of nonprofit organizations exceeds 1 million worldwide and continues to grow. In an e-mail interview with Molly Barker, founder of Girls on the Run, she indicated that “our society is evolving… more individuals are learning that external rewards relating to money, prestige, and career are not always gratifying.”³¹ Furthermore, Robert McEwan, CEO of Medbank pointed out that “lack of grant funding, and the pressure for granting agencies for grantees to be sustainable contributed to the expansion of social entrepreneurship.”³²

There is a growing interest among ...

Table of contents

• International Social Entrepreneurship: Pathways to Personal and Corporate Impact
• Chapter 1: Introduction
• Chapter 2: Assess Personal and Corporate Citizenship
• Chapter 3: Understand the Environment
• Chapter 4: Identify the Appropriate Mission
• Chapter 5: Plan for Internationalization
• Chapter 6: Pursue Strategic Action
• Chapter 7: Adjustment and Reinvention
• Chapter 8: Make a Personal and Corporate Impact
• Appendix: Tale of the Globalist
• Notes
• References