Corporate social responsibility has been playing an increasingly vital role in shaping the policies and practices of companies over the course of the past decades. Whether it be small family-owned businesses or multinational corporations, strong commitment to social, ethical and environmental standards has become deeply embedded in the DNA of most modern companies and their international supply chains. Businesses that remain solely focused on their bottom line not only have a difficult stand in terms of branding and public recognition, but also when it comes to acquiring and retaining motivated high-quality talent. Doing business in a way that is sustainable and serves the greater good has become imperative, especially in times of climate change and Covid-19. In recent years, a sector dedicated to this concept has continuously thrived – social entrepreneurship.
CSR and Social Entrepreneurship
On the surface, social entrepreneurship and corporate social responsibility share common characteristics: Both terms describe the involvement of business ventures in the development and funding of solutions to socio-economic and environmental issues; from poverty alleviation and education programmes to environmental conservation initiatives and climate action. However, the two concepts are distinctly different from each other in their underlying approaches to realising social and environmental betterment.
Companies that practice CSR typically do so by embedding high sustainability standards into their existing business models, for instance in terms of fair trade, labour conditions and energy efficiency. This way, companies not only make valuable contributions to the local communities in which they operate but are also able to enhance their own corporate culture and abide by increasingly high expectations from staff, stakeholders and investors. One of the most commonly referenced evaluation methods for business performance in the past 25 years that takes CSR into consideration has been John Elkington’s ‘triple bottom line’ framework – people, planet, and profit – as a measure for a company’s social, environmental and financial success. If implemented consistently, CSR may help raise the standards of entire industries over the long run.
CSR practices are commonly in line with the United Nations Sustainable Development Goals (SDGs). The SDGs were adopted by the UN General Assembly in 2015 and comprise of a list of 17 goals to “transform the world for persons with disabilities” by 2030. The goals set out to achieve substantial progress on a range of global issues, including people’s livelihoods, health standards, gender equality, human rights as well as environmental and wildlife protection. Many leading companies emphasise their commitment to the SDGs through their own charitable foundations as well as membership in international organisations and platforms for the promotion of sustainable business practices, such as amfori and econsense.
Social entrepreneurship, on the other hand, describes the integration of social responsibility into a start-up business model, whose main purpose lies in identifying and addressing a prevailing issue and thereby contributing to the improvement of living conditions and societal cohesion. Social enterprises will often leverage digital technology to bridge different sectors of society and to deliver innovative solutions to underdeveloped areas or marginalised communities, in order to facilitate better access to educational resources, healthcare services or social welfare. Social enterprises can differ in their size, organisational and financial structure but are generally similar in that they apply a business strategy that prioritises impact on the ground over profitability.
In basic terms, CSR aims to improve existing economic structures and implement sustainable practices along the entire value chain, whereas social entrepreneurship is characterised by an intrinsic motivation to grow a sustainable business venture that can provide an effective solution to a specific issue and may be commercially viable at the same time.
In some cases, corporate responsibility and social entrepreneurship are closely intertwined. For instance, German software developer SAP started the ‘One Billion Lives’ programme in 2016, under which company employees have been utilising SAP’s existing know-how and technological resources to build a portfolio of social business ventures with the potential to improve people’s lives. Since the programme’s inception, numerous enterprises have been launched on a broad range of issues from closing the gender pay gap to advancing cancer treatment in India.
The Ecosystem in Hong Kong
The social entrepreneurship ecosystem in Hong Kong has continuously expanded in size and scope over the past decade, and hundreds of businesses have been created to address many of the city’s long-running structural problems, such as affordable housing, demographic change, or waste management, through social innovation.
Hong Kong currently counts well over 650 social enterprises spread across the territory’s 18 districts, according to the Directory of the Social Enterprise Business Centre (SEBC). The SEBC was set up in 2008 by the Hong Kong Council of Social Service (HKCSS) to nurture social innovation by facilitating cross-sector cooperation between private businesses, NGOs and academia. Another milestone followed in 2013, when the Hong Kong Government launched the Social Innovation and Entrepreneurship Development Fund (SIE Fund) as a platform to provide individuals and organisations with the necessary resources to grow innovative ideas into sustainable business models.
To this end, the SIE Fund connects social entrepreneurs with experienced “intermediary” organisations, through which it provides the funding to scale up innovative initiatives and effectively reach disadvantaged groups of society, including low-income families, persons with disabilities, ethnic minorities and single parents. The current second batch of intermediaries, announced on 12 June 2020, comprises of the HKCSS, Fullness Social Enterprises Society Ltd., PolyU Technology and Consultancy Co. Ltd. and the Society of Rehabilitation and Crime Prevention, Hong Kong.
As of April, the SIE Fund had distributed over HK$250m to more than 200 projects in the three areas of research, capacity building and innovative programmes, to the benefit of nearly 250,000 people. Initiatives under the SIE Fund are highly diverse. Success cases include the Community Housing Movement, which has helped to provide transitional public housing to over 340 families since 2017, Bean Care, which offers a crowdfunding platform for local charity projects that is based on e-wallet application, and many more.
The Robot for Autism Behavioral Intervention (RABI) programme aims to provide social and behavioural learning assistance to young children with autism spectrum disorder with the use of teaching robots. The support programme is offered both online and home-based to include households without a computer or access to high-speed internet. In the context of Covid-19 and the city-wide school suspension, such support initiatives are filling a crucial gap in the public education system.
Against the backdrop of the current pandemic as well as global challenges such as population growth and climate change, which will have dramatic implications for countries and communities around the world, both CSR and social entrepreneurship are becoming increasingly important factors in safeguarding environmental and economic stability and living standards.
With their ability to effectively blend business skills, creative mindsets and local expertise into a targeted approach, social enterprises are contributing an important puzzle piece to the collective efforts made by corporations, governments and NGOs to achieve social equity and sustainable economic development. Hong Kong’s thriving social entrepreneurship ecosystem has the potential to substantially improve the lives of underserved sectors of society locally, and perhaps develop solutions that could find application in other regions as well.
By Hendrik Hillebrecht
Related Links
- Source: Harvard Business Review – "Triple Bottom Line"
- Source: HKSARG – Press Release: New rounds of Innovative Programmes launched
- Source: HKU Research Digest – Corporate social responsibility: Doing good is good for business
- Source: SAP – SAP One Billion Lives Initiative Chooses Three Ventures from 2018 Cohort
- Source: Social Enterprise Business Centre
- Source: Social Innovation and Entrepreneurship Development Fund (SIE Fund)
- Source: United Nations – Sustainable Development Goals
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