Three key experiences have prompted me to write this somewhat questing article and pose the questions within it. I would be grateful to hear any and all opinions, as by no means do I claim to hold any answers, or that within the limited space available here I could provide them in any worthwhile depth. I offer only questions for consideration.
The first experience was a weekend spent avidly reading Paul Mason’s book, Post Capitalism: A Guide to Our Future, and in particular noting his ten ‘victory conditions’, through which we might recognise a successful transition towards a more egalitarian form of the social and the economic.
The second was hearing Nick Temple from Social Enterprise UK proudly stating that the American multinational medical devices, pharmaceutical and consumer packaged goods manufacturer Johnson & Johnson, which generates over £70bn in sales annually, is planning to spend £15m with social enterprises in the UK by 2020.
Thirdly, my experiences of the social enterprise of which I am managing director, Opus Independents, with Sheffield Council in recognising, describing and ascribing value to social impact or benefit in its contracts and tendering process.
Is social enterprise confined to picking up the scraps
thrown to it by larger organisations who wish to appear benevolent?
Let’s start with the big picture. Paul Mason argues rather convincingly that the current economic and social system, namely neoliberal capitalism, is ill equipped to solve the most important challenges of the day. In this he lists slowing climate change and redistributing resources more evenly across the global population, among many other things. Mason also argues that the rise in information and design at the expense of labour and manufacturing undermines the current system’s ability to value products and services.
The obvious example of this is Wikipedia, which has reportedly taken £3bn from global advertising revenue because we no longer print encyclopaedias.
My fundamental question is as follows: is social enterprise, as a mechanism which operates using the basics tenets of capitalism, able to adequately provide solutions to social problems? Furthermore, is it even a model which has the robustness to survive into the future while meeting its triple bottom line?
In doing further research on the claim that Johnson & Johnson will spend £15m with social enterprises in the UK by 2020, I found the following illuminating quote from Rebecca Ellinor Tyler, writing for supplymanagement.com: ‘Johnson & Johnson are not obliged to buy from social enterprise suppliers, but do so. It fits their credo of backing supplier diversity, it improves the company’s reputation and it could even lead to increased revenue over time. The City of London Corporation says buying from social enterprises is a way to purchase what you need while also demonstrating your company’s values.’
In the case of Johnson & Johnson, what percentage of their overall spend with suppliers is £15m? I find myself asking the most cynical question of all: who is really benefiting from this and what value does social enterprise have if its primary use is merely one of demonstrating corporate social responsibility? Is social enterprise therefore essentially confined to picking up the scraps thrown to it by larger organisations who wish to appear benevolent with minimal risk or cost?
For a wider angle view on the pressing need for corporates to associate their company values with societal issues like climate change and social justice, I would suggest watching Mark Stevenson’s ‘An Optimist on Tour‘ talk.
This brings me to my third experience, of social value and the local authority tendering process. Local authorities are prohibited by law to give advantage to organisational structures which have social benefit at the core of their provision. Social enterprises, on the other hand, must be surplus generating in order to achieve sustainability, but must also consider their social and environmental aims as well. Given the massive cuts to local authority funding and the added costs of meeting the triple bottom line, the odds will always be against social enterprise when competing for public sector work.
To make this situation even more complex, local authority tendering processes are often unable to understand the social impact of the third sector except through the language of economics – jobs created and so on. This creates a further problem for these organisations, who often see their social impact in qualitative, rather than quantitative, terms. If society is unable to appreciate and thus endorse and reward social enterprises at the level of applying for tenders, then what hope does the social enterprise model have of competing with solely profit-making organisational structures?
In concluding this article, I should say that I believe a positive narrative for the future of social enterprise beyond neoliberal capitalism is emerging, but I do find myself asking yet another broad question. If the eventual goal of the social enterprise sector is not to place social and environmental benefit at the heart of all organisational and commercial structures in society, then what is its long-term purpose, where is it headed and what are its victory conditions?
James Lock is managing director of Opus Independents, a Sheffield-based social enterprise which publishes Now Then magazine, runs a promotions service plus festivals and events.