Social enterprises are becoming increasingly trendy nowadays. As consumers become more aware of social justice and the climate crisis, businesses that are committed to social and environmental causes grow in popularity. However, social enterprises have a specific business model and should not be mistaken for other types of companies. So, what exactly are social enterprises and why do they matter?
What makes a social enterprise?
According to Investopedia, social enterprises are businesses that “seek to maximize profits while maximizing benefits to society and the environment”. Often, the profits generated are used to fund nonprofit programs.
This means that not all businesses selling eco-friendly products are necessarily social enterprises. While any steps towards sustainability should be celebrated, businesses that are more focused on providing excellent products for a considerable profit are not technically social enterprises.
Social enterprises tend to embrace sustainability in its multiple dimensions – social, economic, and environmental. Therefore, if the products or services sold are lacking in one of the dimensions, other programs funded by the social enterprise tackle that gap.
For example, eco-friendly products of social enterprises tend to be more expensive than their mainstream counterparts. However, the profits generated are used to pay fair wages to artisans or save endangered forests.
Why do social enterprises matter?
The global community is at a crossroads. The extractive capitalist model puts our planet and our communities at risk. But many people still struggle to find an alternative model that can put social and environmental concerns before profit, without stagnating economic progress.
Social enterprises are the answer to that dilemma. They foster both social and technological innovation, while at the same time promoting sustainable development goals. The best innovators and changemakers of our time understand the importance of businesses that care more about all of us rather than their shareholders.
Social enterprises inspire both entrepreneurs and consumers to actively invest in the well-being of their communities and the planet. They also seem to foster gender equality and women’s leadership. Women are more likely to become social entrepreneurs than to invest in any other form of business.
Finally, social enterprises are often the best way for nonprofit organizations to become self-sufficient. At a time when funding and donations are going down, threatening the existence of many organizations performing essential work, many nonprofits are either transforming into or partnering with social enterprises to fund their programs.
How can you support social enterprises?
Firstly, you need to know they exist. Social enterprises are often small businesses fostering change at the local level. While many do invest in marketing, the funding priorities are often focused on social or environmental programs. Therefore, doing your research is essential.
At Ecoripples, we strive to profile lesser-known social enterprises that are doing great work all over the world. Although most popular social enterprises are based in the Global North, there are plenty of excellent and innovative examples from the Global South which need to be celebrated.
Secondly, you need to understand how to replace everyday products with sustainable ones. Fast fashion is one of the most infamous examples of how excessive consumption and low quality endanger the planet. Therefore, it is no wonder sustainable fashion has been growing exponentially in recent years.
But did you know there are sustainable alternatives to almost everything, from watches to body care products to children’s toys? In our blog, we try to offer advice and suggestions about how common items can be easily replaced by eco-friendly products. We do the research for you, while at the same time showcasing some of the best social enterprises around the globe.
Finally, supporting social enterprises also entails supporting the communities of entrepreneurs and their vision. Together, we are stronger and can find better solutions. This is why Ecoripples also profiles the innovators behind social enterprises and tries to foster a community committed to sustainability.
The future of social enterprises lies in your hands.
We all know systemic social justice issues and the climate crisis will not be solved by individual actions alone. However, in the case of social enterprises, whether they thrive depends on the consumers. Social enterprises will only become a true alternative to mainstream business models when we all, collectively, decide to invest in them.
Therefore, the next time you need to buy an item, do your research. Ask yourself: what are the sustainable (and often more durable and better quality) alternatives out there? How can I make sure my purchase will beneficial not only for me, but also for my community and the planet?
Real change does not come all at once. But together, little by little, we can ensure a truly sustainable development for us and for the next generation.
