In social development, social business has emerged as an important topic. Its impact on enriching and empowering people’s lives has become evident all over the world.
To combat the global economic crisis, social business has harnessed the advent of technology and modern science to eradicate poverty, hunger, unemployment and other social problems. Social business has been around for the last three decades in Bangladesh. It has empowered women and reformed many facets of society. Bettina Wassener of The New York Times writes, “Microlending, which took off in the 1980s, has allowed many women to start tiny businesses. More recently, millions of people have found work in the garment industry, which accounts for about three-quarters of the nation’s exports.”
The world economy changed in the beginning of the 1990s. With the end of the Cold War, the free market economy spread throughout the world leading to a tremendous economic boom. At the same time, social and political conflicts have also dominated our lives. The free market economy cannot end hunger, unemployment, and poverty. In fact, it often causes these problems. To tackle the social problems, we need to adopt social business, a model that encourages businesses to make profit and invest in social development. It’s a win-win situation.
Recent Wall Street fallouts depict the problems of the free market economy. Greed and recklessness often consume those who seek big profits and bonuses. As an alternative to traditional businesses that not only seek profits but also promote social development, social business has caught our attention. Nobel Peace Prize winner Dr. Yunus is the inventor of this innovative business model. The distribution of resources in the world today is unequal. In fact, there is a huge gap between the haves and have-nots. The consequences of this lack of distribution have caused poverty, unemployment, illiteracy, poor health, and other social problems.
The goal of the social business model is to provide opportunities for the investors or the business owners to make profit from their investments and to create lasting effects for the marginalized. They must reinvest interests earned from their investment into one or more social development initiatives. The ultimate goal is to enrich and empower people. The world today stands at a crossroads where we must make a conscious choice between personal gain and collective good. The choice should be the latter, if we want to eradicate social ills that continue to cripple our lives and morale and often lead to social and political unrest. Investors and the recipients of the services, mainly the poor, can become the owners of a social business. Investors retain only a portion of the interest generated from their investment. The rest must be reinvested into the social development projects. The recipients, on the other hand, also retain a portion of the interest and the rest must be used to expand the social businesses they have started.
Social business can be started in a variety of areas – education, nutrition, housing, solar energy, or technical training. Anyone start a social business. There is no barrier to entry. But social business owners must have the goal of resolving targeted social problems. The problems can be small or big. Regardless of the extent of the problems, we now have an option to do something about those problems. Social business is a relatively new concept. Many countries are experimenting with this to eradicate their social problems. This innovative concept of empowering people’s lives is spreading fast. The expectations are growing as well. The poor and the marginalized are benefiting from this idea. We cannot stop now.