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1、 The Young Social Entrepreneurs Book of Guidelines and Checklists”History,Definition and Alternative Forms of Social Entrepreneurship CHAPTER 1 Page8 CONTENTS Social economy and social entrepreneurship:Definitions Evolution of the concept Similarities and differences between the commercial and socia
2、l enterprise Social challenges around the world:Africa Asia Europe Latin America and Caribbean North America Alternative forms of social entrepreneurship Activities for readers References Page9 Social economy and social entrepreneurship:Definitions In recent years,the world is facing multitude chall
3、enges which threaten the sustainable social development.Economic,political and environmental crisis brought up a number of issues that need to be addressed adequately.Public funds are becoming increasingly insufficient,while businesses are expected to assume greater share of responsibility for socia
4、l and environmental welfare.Those trends lead to the emergence of new concepts such as social economy and social entrepreneurship.Social economy is a hybrid sector between business(private)sector and public sector aimed at providing quality social services for needy communities and individuals.Socia
5、l economy encompasses enterprises and organizations,in particular social enterprises,cooperatives,mutual societies,associations and foundations producing and offering goods,services and knowledge,while pursuing economic and social goals and promoting solidarity.The social economy is an important fac
6、tor for creation of employment and fair distribution of goods.It promotes social inclusion and cooperation and contributes towards sustainable societal development while maintaining ecological balance and effectively regulating the socio-economic environment.Why the world needs social economy?There
7、are social challenges that are not faced adequately by the existing social models The social security system is overburdened The traditional business model cannot meet societys expectations for social contribution and growth The global issues require global solutions which starts on community and in
8、dividual level Social entrepreneurship is a new business and social trend within the social economy concept that reflects the need to address various societal challenges in a creative and sustainable way.The main objective of the social enterprise is to have social impact rather than making profit f
9、or its owners or stakeholders.It operates by providing goods and services for the market in an entrepreneurial and innovative fashion and uses its profits primarily to achieve social objectives.Similar to the traditional companies,social enterprises operate on commercial markets,generating profit fr
10、om their activity.However,unlike other businesses,they exist to fulfil their specific social purpose.Social entrepreneurship refers to ventures targeting underserved populations,decreasing the gap between those who have access to social services and those who do not.While commercial entrepreneurship
11、 often responds to a market opportunity,social entrepreneurship often tackles a market failure.The bottom line of a commercial enterprise is financial profit,while the bottom line of a social enterprise Page10 is the social impact it creates.Though social ventures could be both,for profit and non-pr
12、ofit,the profit is not the goal,but rather means for sustaining financial viability of the enterprise(Chahine,2016).Usually the profit is not distributed among the shareholders but is re-invested to expand the activities for the benefit of the target groups,enhancing the scope and the quality of the
13、 social services.Definitions:Social entrepreneurship is the process by which effective,innovative and sustainable solutions are employed to meet social and environmental challenges.Social enterprise combines societal goals with an entrepreneurial spirit.It focuses on achieving wider social,environme
14、ntal or community objectives Social entrepreneur is an individual who designs and implements product,service or solution to an existing social challenge aimed at improving the social welfare.Social venture:any initiative,including project,organization or event aimed towards positive social or enviro
15、nmental change Social start-up:A new company or organization formed with the primary purpose of tackling social or environmental challenges Social innovation:Act of pioneering new methods,processes,products and services that address social and environmental issues.The social enterprises mainly opera
16、te in the following fields:Work integration:training and integration of people with disabilities,long-term unemployed,immigrants,people from ethnic or racial minorities and other marginalized groups of the population.Human rights:liberty,poverty alleviation,pursuit of happiness,integration,anti-disc
17、rimination,gender equality,freedom of speech etc.Heath and care services-health,well-being and medical care,health services,childcare services,services for elderly people and people with disabilities Education:professional training,education,personal and career development Regional development:Econo
18、mic and social development of remote,rural areas,neighbourhood development/rehabilitation schemes in urban areas,development aid and development cooperation with third countries Environmental protection and sustainability:recycling,environmental awareness and protection,sustainable usage of natural
19、resources,use of Page11 renewable sources of energy,bio and organic agriculture,preservation of cultural and heritage sites,Others:Amateur sports development,arts and cultural projects,science,research and innovation,consumer protection,tradition,crafts and ethnic heritage enhancement,ethic consumpi
20、ton THE SOCIAL ENTERORISE IS.A VENTUREFor Profit Business CompanyNon Profit OrganizationCo-operativeBenefit corporation(USA)Community Interest Company(UK)Charitable OrganizationWHOSE PURPOSEProvision ofproducts andservicesEmploymentEnvironmental protectionCommunity supportSocial inclusionIS TO CHANG
21、E THE WORLDProvide services/products for disadvantageconsumersSupport social and environmentalprogramsImproverelationship between stakeholdersProcure financing,education andsupport for targetgroupsFOR ACOMMONGOODPoverty alleviationHealth and well-beingGender equalitySocial justice Page12 “The Young
22、Social Entrepreneurs Book of Guidelines and Checklists”Definition of social entrepreneurship Social entrepreneurship is an economic activity(business)that:Has a mission aimed at solving important societal problems Earns income Is self-sustained for any type of business activity,but solves social iss
23、ues.Definition of social enterprise An economic entity which stands between non-profit organizations and ordinary business entities;A commercial,civic organization or cooperative with a basic social mission;An organization aimed at solving socially significant problems;Receives financial and non-fin
24、ancial support from the community Can be a commercial entity,a foundation or association for public benefit,a cooperative.An enterprise that is fully dependent on its economic activity.Page13 Evolution of the concept Traditionally,the main goal of the entrepreneurship is considered to be the creatio
25、n of financial profit through production and sale of goods and services.The social problems were left to the competencies of local and national authorities,the government,the NGOs,religious and charitable organizations.In recent years,however,the breach between business and social interests become m
26、ore and more evident.On one hand,the severe competition between companies in an attempt to increase their profit and market share,lead to a number of negative outcomes for the society and the environment.The use of carcinogenic herbicides,GMO products,child labor exploitation,corruption,environmenta
27、l pollution and many other notorious practices showcased the need of change in the existing business paradigm towards more socially responsible approach.On the other hand,it became clear that the governmental and non-governmental organizations are not capable to address adequately the various and co
28、mplex problems related to the society and the environment.As social problems are becoming more poignant,those non-profit structures became ineffective due to cumbersome,institutional and donor-dependent model of operation.These organizations are expected to change and to become more entrepreneurial
29、and less institutional.As a result,the new trend of combining social innovations in business settings lead to the creation of the third sector economy the social economy which blurs the traditional boundaries between the public,private and citizen sectors.The social entrepreneurship as a concept bec
30、ame popular in the mid-20th century with the H.Bowens(1953)book“Social Responsibility of the Business”,but the idea can be traced several centuries ago within the tradition of the fraternity and sorority religious organizations,the cooperative movement and the charitable ventures.Some notable promot
31、er of the social entrepreneurship idea even before its conceptualization are Florence Nightingale(the founder of the first nursing school),Rober Ownen(the creator of the cooperative movement),Vinoba Bhave(the initiator of the Indias Land Gift Movement)and Maria Montessori,the founder of innovative t
32、eaching and educational methodology aimed at addressing children with various cognitive abilities,including mental illnesses.The social entrepreneurship is in the same time evolutionary and revolutionary phenomenon.It evolved throughout the centuries as a hybrid organization between for profit compa
33、nies and non-profit entities,but in the same time it offers an innovative approach and idea in creating added value for all the consumer,the business owner and the society as a whole.The social entrepreneurship is aiming at maximizing the benefits for all stakeholders involved.Its principles,methods
34、 and organizational models continues to develop reflecting the technology development and addressing more and more group of people,social and environmental challenges.Similarities and differences between the commercial and social enterprise:Social and commercial enterprises share many common feature
35、s concerning their organization,legal structure,management and marketing.In the same time,they have some notable differences and specificity.Page14 Similarities:Need for sufficient startup and operational capital Creation of profit margin to ensure the financial sustainability Similar legal structur
36、e Similar approach in business planning,marketing,management and promotion Aimed at achieving high quality products and customer service Motivated,skillful and dedicated personnel Competitive advantage,good marketing position and strong brand image Differences:Profit is not a final goal,but a tool f
37、or sustaining financial viability Profit is seldom distributed,but is reinvested into new social initiatives Staff members might be zero paid(volunteers)Sources of financing can vary,apart from traditional financing tools they might include donations,fund raising initiatives and more innovative sour
38、ces such as crowd funding platforms The success of the social enterprise is measured by the positive social impact that it creates.Social challenges around the world On a global scale,the social enterprises face various issues and have different kinds of social,environmental and cultural purposes,re
39、flecting the diverse needs and interests of the communities they work in.Some of the common goals include poverty alleviation,social inclusion of marginalized groups of people,enhanced welfare of the society etc.,but there are a number of challenges that are especially relevant to specific world reg
40、ions such as:The bottom line of a commercial enterprise is financial profit The bottom line of a social enterprise is the positive social impact Page15 Social issues and challenges in Africa:The incidence of HIV/AIDS,malaria and tuberculosis has dramatically worsened in most African countries;Povert
41、y,unemployment and socio-economic inequalities have aggravated throughout the sub-region,and the urban/rural disparity has widened;Although secondary and higher education supply and demand have improved,the results in terms of quality do not meet the needs of the labor market;Faults in the statistic
42、s system and unreliable data base hinder the monitoring and assessment of the social policies impact The informal(“grey”)sector is the major source of employment in the urban and rural areas lacking appropriate policies for its regulation;and where such policies exist,they are not always implemented
43、.Recent economic reforms have not resolved the social problems,and in some cases they became even worse;Social issues and challenges in Asia:Violation of children rights(including child prostitution,child labor and exploitation,trafficking etc.)Social exclusion for marginalized groups of people;Gend
44、er disparity;Geographical remoteness affecting the quality of life;Income inequality;Page16 According to the UNICEF report(http:/www.unicefrosa-progressreport.org/),South Asia is suffering a number of problems related to social exclusion.The poverty and deprivation are among the worst levels globall
45、y,affecting as many as 330 million people.South Asia averages indicate that 46 per cent of children fewer than 5 are underweight,primary school enrolment is at 74 per cent rate,and adult literacy is at 58 per cent total and only 45 per cent for women.Social issues and challenges in Europe The social
46、 system in most of the EU members is well developed and include special measurements and regulations aimed at addressing:Health care and medical insurances Retirement funds Unemployment Labor regulation and labor organizations Education,child care,deviant behavior of youngsters Integration and inclu
47、sion especial of marginal groups such as ethnic minorities and immigrants Regional disparities It is a common practice throughout the European countries that medical insurances and retirement allocations are made mandatory by law and secondary legislation.As a result,the number of people who are out
48、 of the social security or health care system is very small.However,those policies have faced a number of challenges in recent years,as the population is aging and the number of contributors is dwindling,while there are more and more beneficiaries.The outgrowing number of immigrants from Africa,Asia
49、 and the Middle East put additional pressure on the EU social systems which is becoming a key issue for the European policymakers.The division of Northern and Southern,Eastern and Western Europe is being reshaped through a social policy of integration and cohesion.Most of the EU countries have stron
50、g focus on improving the well-being of the society as a whole and allocate enormous resources for achieving goals like social inclusion,health,environmental protection,education and increased employability.It is not evident however if those goals have been achieved,since they are hard to measure.Mor