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I think in todays age all businesses need to be 'social' and make a positive difference to consumers lives and wider society. Not just fulfilling their needs but going beyond that and creating change for the world. The idea of CSR (corporate social responsibility) I would say is a must for businesses to engage in. Those businesses that do conduct social good often are the businesses that are more profitable in the long run. Ultimately businesses are serving people, so they should consider people, the environment, the community in which they exist in and their ethics in order to create a sustainable business.

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Paper: http://umich.edu/~thecore/doc/Friedman.pdf
In a well known paper Milton Friedman stated that the objective of a company should be to maximise its profits as if companies pursue any other goals they are inefficient. I partially agree with this and the logic is quite clear but I was wondering what everyone else thoughts were on this? It has an ethical message at heart but I am unsure what I think of it. Especially as it doesn't acknowledge that doing good is good marketing for most now.

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As in the previous section, it is stated that new businesses are more focused on "doing good" than making profit. This is clearly due to the fact that our society prefers to buy from a brand with a good image, that they trust, than from a company which is cheaper, but which may have a negative impact on society. I believe being a 'social business' might be vital to survive nowadays, and it cannot be seen separately.
An article from the Harvard Business Review (https://hbr.org/2013/01/every-business-is-or-should-be) states that "all businesses are social" and gives good examples and helps to reflect on this topic.
- Erika dM

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I believe the distinction between social and non-social business is a false dichotomy. And yet, it's one we continually want to make. We talk about "social businesses" - those that are mission-led and focused on creating positive social change - and "non-social businesses" - those that focus on revenue and profit. Social entrepreneurs launching ventures may ask themselves if their business models need to be different. Does pursuing a social purpose require something unique to describe and structure your business?

As someone who works with a variety of organizations in my roles as strategy and innovation consultant, venture capitalist, professor, and mentor, this question intrigues to me. To answer it, I evaluated a few years worth of business models created and implemented by clients (usually established, mature businesses), invested companies (early stage), entrepreneurs I've mentored, and college students starting new ventures. The results? I found that both social and non-social businesses focused on making sure revenues were greater than costs, either through selling something, raising money or getting grants. The differences were more along traditional business characteristics: virtual vs. physical product or service, B2B vs. B2C, etc.

That said, this initial evidence showed that social businesses focus more on achieving a positive impact in each of the nine business model elements - value proposition, customer segment, channels, relationships, key partners, key activities, key resources, costs and revenues - as well as the whole model. Many of the non-social businesses in my sample also focused on the impact of each element and interestingly, they are very successful businesses (might there be a correlation?).

All businesses are social. All companies have people as customers, employees, and suppliers. At some point, in deciding which supplier to use, in engaging your workforce, and in getting your product into users' hands, relationships with people matter. Improving these their experiences always improves the outcome for your company.

If a business isn't providing valuable, meaningful solutions to real customers' problems or delivering outcomes that both make a positive difference in the customers' lives and support the company's mission, the business won't have to worry about profits or outputs for long. The market has a way of taking care of that.

The historical division between social and non-social business and "purpose" vs. "profits" is artificial and antiquated. Almost exactly two years ago, Michael Porter and Mark Kramer called for a new definition of capitalism - " shared value " - to unify this false choice. I think this is how Adam Smith envisioned capitalism; we just redefined it to serve our purposes. In fact, our financial crisis in part stems from non-social businesses divorcing impact from profit and the outcome will haunt us for a long time.

To further test what I had learned, I turned to business model guru and friend, Alex Osterwalder (I've used his Business Model Canvas since 2009 because I believe it's one of the best methodologies out there). He has vast experience creating business models all over the globe, in almost every industry sector, and he came to the same conclusion: There is no significant difference in the business models themselves. In fact, we agreed that for-profit social businesses are a powerful way to increase impact. For instance, Sun Edison's business model demonstrates that increasing impact doesn't decrease profitability. One of Alex's favorite businesses, PeePoople, is implementing a similar model to provide basic personal sanitation to the 2.6 billion people who don't have it today. As Alex says, "The most amazing business models are those where profit and impact live in harmony. Business models can be designed where impact doesn't diminish revenues or profit and vice versa."

Does this answer the question about needing something different for a social business? I think so and the answer is clearly no. It's time we stop talking about "social" vs. "non-social" and encourage all entrepreneurs to focus on impact in every element of the business model as well as the whole. We read about companies, like Patagonia, Virgin, Cemex, who profitably and purposefully balance doing well and doing good. If they do it, why can't you?

There are also some quiet, under the radar companies, like 6th generation family-held Menasha Corp in Wisconsin's Fox Valley. The 164-year-old corrugated packaging firm has over $1B in revenue. Despite being in a commodity-driven market, it has experienced seven consecutive years of remarkable growth, even during the recession. Menasha's plants use heat from the corrugators to warm the buildings; they've reduced water usage while increasing production; their culture is collaborative; and their people are active in their communities, serving on school boards, supporting art and music, and having plain old fun in the Muscatine Great River Days boat races. The result is synergistic growth of a company and its communities.

By focusing on each individual business model element and the model's overall impact to create outputs that support sustainable outcomes, perhaps our social entrepreneurs can help society break down this tired, man-made wall between social and non-social businesses.
Follow the Scaling Social Impact insight center on Twitter @ScalingSocial and give us feedback.

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Every Business Is (Or Should Be) a Social Business

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I believe the distinction between social and non-social business is a false dichotomy. And yet, it's one we continually want to make. We talk about "social businesses" - those that are mission-led and focused on creating positive social change - and "non-social businesses" - those that focus on revenue and profit.

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I think all businesses should be socially aware and make CSR a big part of their image. As we all know consumers have a diverse range of options to choose from when it comes to the choice of shops.
For example, FIFA, HSBC & GAP, were voted in the top 10 companies with the worst CSR - nominated in 2014  Public Eye Awards. FIFA forced evictions & impacts on local communities through construction work for the World Cup in Brazil. HSBC were associated with land grabs & human rights abuse. Finally, GAP supposedly had a lack of effective commitment to protecting worker's health & safety in Bangladesh.
The majority of consumers who use these companies would likley to have heard about these issues and as a result transferred their choice of shop. Of course it depends on the morals of the consumer. However, most will be angered and disappointed by the companies actions.
Source:

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Author: Compiled by Business & Human Rights Resource Centre, Published on:

[Business & Human Rights Resource Centre invited the nominated companies to respond. Responses & non-responses provided]. The annual "Public Eye Awards", cordinated by Greenpeace Switzerland & Berne Declaration, are for companies with the "worst corporate social responsibility records". This year, the nominations include allegations of: BASF, Bayer, Syngenta: toxic pesticides killing bees essential for environment, agriculture & global food production...Eskom: impacts on health & environments through coal-fired power stations in South Africa...FIFA: forced evictions & impacts on local communities through construction work for World Cup in Brazil...Gap: lack of effective commitment to protecting workers' health & safety in Bangladesh...Gazprom: damage to the environment through oil spills...Glencore Xstrata: negative effects on social, cultural & political rights of local communities & indigenous groups, including forced displacement...HSBC: financing companies including Sime Darby & Wilmar associated with land grabs & human rights abuses...Marine Harvest: impacts on indigenous peoples' livelihoods & damage to environment in Chile.
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10 companies with "worst corporate social responsibility records" nominated for 2014 Public Eye Awards | Business & Human Rights Resource Centre

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Skip Content This piece of content is part of a larger story, but that story is not available in your language. We do still recommend you read this content in the context of this story: [Business & Human Rights Resource Centre invited the nominated companies to respond. Responses & non-responses provided].

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As long as a business is operating within the legal limits and is producing a profit it can be considered a 'social business'. If a business is providing a solution to real customers problems (which any business that is making a profit will be doing) by definition they are addressing social issues. This of course is the minimal amount I think an organisation should do to ensure social welfare. This article by HBR highlights some interesting points regarding this subject. https://hbr.org/2013/01/every-business-is-or-should-be

-Floris ter Haar

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I believe all businesses can be social in some ways, but social enterprises are the ones who are actively pursuing a social goal, placing that social goal on either the same or higher priority to their other goals such as profit making.

For example, Lush may be considered a social enterprise as its environmental policies and policies against animal testing are marketed at their forefront of its business and it is inseparable from its brand identity.

However, a business like Pret donates a part of its income to help reduce homelessness, but their support of the social cause is not their core identity.

Therefore, even if I want all businesses to be social, I believe at this point in time social enterprises still represent their own category of businesses.

-Penny Senanarong

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CSR is becoming an increasingly talked about issue as we have touched upon in previous weeks. An important part of this is the social element. Investors and customers are becoming increasingly concerned with the impact companies are having and this includes their social impact. This is why I do believe that an entrepreneur should consider the social impact of their venture when starting up a company in order to generate the maximum success possible and if they do not do so they may limit who will invest in their company as well as who will purchase their product or service which in turn will effect their bottom line. Therefore, I also believe it could make a company more profitable if they consider their social impact.

- Cassie Bedford

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I don't believe there is a distinct category for social enterprises, as I believe that any business can be considered "social" in some sense, just in different ways. For example, at the core of all businesses is the objective to provide a good or service to a consumer, and this I think can be seen as a "social" attribute. Yes, there are some which have specific goals such as the start up 'Toast Ale' aiming to minimise food waste, but this doesn't fit into a specific category - is it an environmentally sensitive company by minimising food waste? Or can it be considered a social enterprise as it is satisfying a consumer need (beer provision)? The point here is that there are no clear lines or boundaries within the scope of different business ventures that allow us to categorise them, ie many businesses may be able to fit into several - it isn't a black and white issue! Also, what would we gain from making this distinction?

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In my opinion, given the political, legal, economic, social and technological factors concerning business today, corporate social responsibility is necessary in order to target the problems that we face in the 21st century as a result of increasing population, ageing generations and environmental issues. I believe that it is feasible for businesses to maximise profits and sales as well as focus on social issues regarding corporate actions as companies such as ASOS and Boohoo begin to target the problems surrounding the consequences of fast fashion: one example of a business model that has begun to contribute to the environmental disaster we currently face in the world. Another key example to address is the problem of deforestation, something which both Andrex and Velvet are attempting to conquer, by planting more trees than are used to make their products initially. Both of these key examples portray the success of companies that act socially, as not only does it enhance brand image (from a somewhat cynical point of view) but it also helps society from a more general perspective

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I personally believe within todays climate if all businesses did a little more good for society and tried to incorporate a CSR strategy within there corporate strategy then businesses would see benefits as well as societies. For examples if businesses where to adopt the circular economy route more into there business model and encourage customers to return items they no longer want our require to help reduce new materials and reuse old materials not only would this help the environment and be a social good but also this would help decrease costs of new raw materials for businesses, therefore being a win win for all.

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Whilst I agree that profit is an important factor in order for businesses to survive, I believe that it is increasingly important for businesses to be ethical and socially responsible.

A huge benefit of being socially responsible is that businesses can often attract a larger pool of applicants for job vacancies. People are more likely to apply to a company that shares similar values to themselves in regard to sustainability. For example, I found a report by the Guardian which states that almost half of the workforce (42%) want to work for an organisation that has a positive impact on the world.

https://www.theguardian.com/sustainable-business/2015/may/05/millennials-employment-employers-values-ethics-jobs

- Imogen C

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Yes, all businesses should aim to help society, as well as grow as a business

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Yes, all businesses should aim to help society, as well as grow as a business

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I believe that if every business kept a positive helping hand in mind when making decisions a lot of social issues would be no longer.
An example for this would be Primark dismissing sweat shops and poor working conditions in lower income countries. This way workers will have less health hazards and will be more motivated to work and most importantly will have a higher standard of living outside of work.
This is a massive issue in many countries with lower regulations and businesses should not take advantage of It rather do their part to ensure these workers receive the same opportunities as other countries' workers.

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No, I don't think all businesses should be social as

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No, I don't think all businesses should be social as

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Yes social enterprises represent a distinct category of business.

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Yes social enterprises represent a distinct category of business.

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Social enterprise are businesses that use their profits in order to change and shape the work for the better. They use different strategies to improve social, financial and most importantly environmental well being.
It is important to note that not all businesses have the same vision as social enterprises. Some are only focused on maximising their profits and put the social and environmental impacts on the side such as Target.
It is definitely important to differentiate business that use their profits in order to reinvest it into something more important and powerful such as social or environmental issues. Than business that only reinvest their profits to make even more profits without any contribution to other sectors.

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I believe that all businesses should be social. Increasingly it is no longer an endorsement for firms to be social, but a necessity. Consumers themselves are now merely opting for businesses that acknowledge social, environmental and political issues. Consumers are aware and making educated choices about their everyday purchases, pressuring firms to act with greater transparency and sustainability.

Not only are consumer choices, shaped by their desire for social responsibility, influencing businesses to act socially, but investors play a part too. More investors are deeming sustainable investment as a no longer a niche function but a obligation. BlackRock, an investment firm, encourages stocks to deliver sustainable long-term financial returns and regard this aim as crucial for all firms.

Additionally, many workers deny the chance to work with companies that fail to care about making a positive impact on the world and in turn it is vital for businesses to establish Corporate Social Responsibility (CSR) programmes.

Liliana Bertolotti

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In any case, companies must act ethically and morally. The outcry of the population can result in serious reputational damage.
Howeveracting ethically and morraly does not mean that it improves the environment, but that workers are treated and paid fairly and that it does not harm the environment.

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Businesses should do social good as this is a form of marketing and can help increase profits - bear in mind, this is from a purely capitalist point of view. Furthermore, social good is profitable to everyone, regardless of profits. Businesses  capable of social good greatly impact society as they may help resolve urgent problems. Patagonia is a perfect example of this with their "Patagonia Action Works" division that connects individuals with grantees, in order to take action on the most pressing issues facing the world today. This allowed for $20,000,000 to be donated towards the protection of the environment. As this is purely beneficial for all parties, I believe more businesses should learn from companies such as Patagonia as with such philosophies, everyone wins!

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People follow different visions, paths and various methods to be successful in their business or in what they do and Eventually, they create value. However, this does not necessarily mean that most of them try to raise welfare level, at least not intentionally, because they may be doing this to earn money just because of greediness and not precisely to add value, but even though they do not tend to do this, they add value either way. CSR is not ordinarily the reflection of the business most of the cases because, in my opinion, the business owners do not usually act in the way equivalent to what it is promised in the CSR. Forwhy because of obeying weak ambitions led by the notion of the tangible power of money. Therefore, not all businesses can be social.

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No, I don't think social enterprises are their own category

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No, I don't think social enterprises are their own category

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I think that businesses which promote themselves pursuing social change are not their own category. Instead, I think they are tapping into a market of consumers who want to make conscious purchasing decisions. They are not a distinct category because they fundamentally are still a business, it just depends on their ethics and motivations they have for their company.

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I believe all business should be social and maintain high ethical standards. In the UK, with so many SMEs, almost everyone has a connection to a business of some kind. Business unifies areas in that way, people are connected through common needs and the trade of fulfilling these needs. Therefore, business needs to be social.
I feel the debate over a business being social comes from big businesses operating and selling in areas that they don't have any social connection to.
Now, we see business trying to correct this through corporate social responsibility.

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No, the customers are now the most important metric for success

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No, the customers are now the most important metric for success

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Businesses used to sell their product for short-term success. The bigger the business, the more successful it was as it pushed out competition using branding and lower costs.

With Technology, "social media makes them far more accessible and puts them in front of a much broader audience than the financial pages [did previously].” It has also closed the 'chasm' that small businesses once couldn't breach as they now have ways to completely by-pass the legacy supply chains.

As there is more inter-connectedness and more opinions than ever that anyone can view online, the main idea of success is now how consumers perceive their business. Therefore CSR is one of the most important metrics of a business, sorry, of ANY business!

The disposable economy is coming to an end, the circular economy is where we are heading, social businesses are the next generation of corporate enterprises.

- Luke Henderson

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Yes, they represent a different category

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Yes, they represent a different category

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Yes I do feel that social businesses represent a different type of business. Although believing in the idea that all businesses should be social is a noble idea, its realities in the business world mean this will probably never happen. As long as businesses are held responsible by their fiduciary duty to shareholders then to some extent they will forever prioritise profit over people and society. This is not to say that those driven by profit cant also have social elements however, an example of this is PWC who although being a profit driven organisation, also have their own social enterprise in the UK that acts as a place for those experiencing homeless to receive training and a job in the hospitality industry.

Purely social enterprises however deserve to operate within their own business category, even from a fund raising perspectives where there are tax breaks for investors that invest in in them.

https://www.pwc.co.uk/who-we-are/our-purpose/empowered-people-communities/community-engagement/social-enterprise/the-fire-station.html

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I believe that social responsibility should be a requirement for businesses, and will use Tata as an example of how a socially responsible company can still grow to become one of the most valuable on the planet.
Tata's founder, Jamsetji Tata, said in 1868 when he first began the company that "In a free enterprise, the community is not just another stakeholder in business, but is in fact the very purpose of its existence."  He believed that a business's primary aim should be to help better the community it serves, and any profits would be an added bonus. 150 years later, Tata is one of the most valuable brands in the world, worth around $100bn. Across India and many of the countries that it operates in, Tata has an outstanding reputation as being a company which makes good quality products, as well as improving the lives of everybody it comes into contact with. Tata has declared that "serving the community is the purpose of the business", and it provides millions to philanthropic causes every single year. It is a shining example of a successful company which places social responsibility above profits alone, and has been extraordinarily successful in doing so.

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I do see how social enterprises are their own category of business, as previously stated from posts above there do exists businesses that operate for the sole purpose of increasing social surplus while on the other end of the spectrum we have businesses that basically have zero consideration for social welfare and focus only on maximising their profits.

However, I think that the rising importance put on sustainability (that introduces a triple bottom line to businesses of profit, people and planet) in markets globally; by both shareholders and consumers will start pushing social enterprises from their own category to be incorporated into all businesses as the growing pressures to be a social business grows globally.

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I believe that all companies can be on board with CSR. The businesses can be guided by social and economic responsibility in all its operations.The responsibility starts internal and then external the businesses. All businesses should be social internal but becoming social externally depends on the company's financial status and how large it is. As big companies have stronger financial status than individuals, they can provide a help according to their profits. Social businesses seek to maximize profits while maximizing benefits to society and the environment. Seeing businesses providing help to non-profit organizations would inspire individuals and increase the business' reputation. But I also believe that, self sufficient businesses should wait to enlarge their businesses to become social.

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Own category, though all business should incorporate social

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Own category, though all business should incorporate social

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In line with some of the other comments, I do think social enterprises represent a distinct category of business due to their focus on social goals, rather than social being an element of the business for CSR purposes.  Incorporating social good into business activities are more likely to profit in the long term, provide they are doing it for the right reasons and taking action, not simply using it for marketing purposes.

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I do think social enterprises are a distinct category of business. Most businesses can have an aspect of social responsibility, but this does not mean their main motive is to generate some sort of social gain. Some businesses will also jump on the social responsibility bandwagon in order to increase their sales as they know there is a demand for certain products, which I believe still makes it a social enterprise. For example, I have bought a few bees wax wraps (the re-usable replacement for cling film) as I was using cling film every day for my sandwiches and realised how much plastic I was wasting. There are multiple places to purchase the beeswax wraps as people have realised how popular they are becoming (for example: https://www.beeswaxwraps.co.uk/shop). They reduce the use of plastic. The selling of the product is physically reducing the amount of plastic which is used. This is a distinct social issue which is being addressed through the selling of the product.

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All businesses are / are required to be social in some sense. Businesses take advantage of resources that are collectively owned by the society at large. They owe a responsibility to all stakeholders, which includes the environment, society, the government, and the community within which they function. Apart from paying taxes being socially responsible is paramount. An interesting case that comes to mind is the exploitative way in which the American company DuPont contaminated surrounding water bodies with cancerous toxins that led to multi million dollar class action lawsuits and the phasing out of the cancerous chemical found in non-stick cookware. This is an interesting case and more about it can be read here https://www.theguardian.com/commentisfree/2019/dec/27/chemicals-dupont-rob-bilott-toxic-america

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All businesses are / are required to be social in some sense. Businesses take advantage of resources that are collectively owned by the society at large. They owe a responsibility to all stakeholders, which includes the environment, society, the government, and the community within which they function. Apart from paying taxes being socially responsible is paramount. An interesting case that comes to mind is the exploitative way in which the American company DuPont contaminated surrounding water bodies with cancerous toxins that led to multi million dollar class action lawsuits and the phasing out of the cancerous chemical found in non-stick cookware. This is an interesting case and more about it can be read here https://www.theguardian.com/commentisfree/2019/dec/27/chemicals-dupont-rob-bilott-toxic-america

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Shine Fotedar

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In todays society there is a trend that the consumer desires a social enterprise, for example Primark gained much backlash for their labour practices and underpaid workers. However, people still continue to buy from Primark because of their USP of low price. Businesses, in my opinion, should be social however that depends upon my opinion and my values as a person. Someone else may not think this and at the end of the day businesses follow consumer demands.

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well, standard for-profit firms have a rigid mission: to maximize the profits for its owners. Social enterprises more aim for "profits with purpose", securing the right trade-off between pro-social behavior and efficiency.

Besley & Ghatak (2017) have researched for social enterprise. They categorized business as non-profit, for-profit, and social enterprises and they have pointed out whether being more standard oriented or social oriented business refers to the business motivation where the interest and motivation of managers takes a large part.

I  think CSR is a competitive advantage for businesses, especially in a market where the rivalry is fierce. Because it is what differentiates you from other mediocre competitors. CSR can be an asset because customers now actually care if a corporation takes its CSR, and it can really affect customers’ choices.

Yet, I think the true argument here is not whether should all business be social, it is whether selection of being social can work for firms in practice and sustain an incentive-compatible outcome for a social point of view (besides the manager oriented reason).  In my opinion, being social is really a general concept, being social can mean caring for its stakeholders, while there is a wide range of a business’ stakeholders, e.g., shareholders, employees, customers, communities, etc. When considering being social, a business will need to trade-off the social benefits it brings to its stakeholders, because not all stakeholders share similar interests, there might be conflicts of interests. So, social enterprises will need to have a flexible mission which balance profits with purpose, to consider the reality of how they can thrive and achieve a balance between social goals and profits.

I don’t really think I can give a firm answer to “should business all be social”, I would say the more a business takes its CSR, the better for its image or reputation and it will benefit the corporate in long run. However, certain factors influence whether a business can be social, like the motivation and strategies from its company directors; and its ability to balance its social goals and its profits, in what position they put their social goals in; and of course certain real-life barriers for companies to overcome illustrated in Davies, Haugh & Chambers’ (2019) article.
(Daria)

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Yes, it is a distinct category of business

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Yes, it is a distinct category of business

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Social enterprises by definition from the article it is about a business model that focused on both maximizing social and financial return. However, from my point of view, it is really putting more effort on the social impact of its business activities, rather than making profit.
On the other side, if the social enterprise doing great and gain large attention from public, it could partner with other businesses that share the similar goal, to help them be social responsible by paying them back to make profit. Collaboration is the key to reach the goal.