Essential Information on an Essential Issue
27 June, 2001
- Innovations and Social Change
- NZ Government to Invest in Social Entrepreneurs
- Defining Social Entrepreneurs
- The Ashoka Story
- The Life Cycle of Social Entrepreneurs
- Social Entrepreneurs in Britain
- The Network in Australia and New Zealand
- COMMACT Conference on Social Entrepreneurs
- Supporting Social Entrepreneurs
- Social Venture Philanthropy
- Enterprise and the Public Service
- Florence Nightingale and The Jobs Letter
- Demos on Social Entrepreneurs
- Practical People Noble Causes
- INNOVATIONS AND SOCIAL CHANGE
SOCIAL ENTREPRENEURS ARE innovators who pioneer new solutions to social problems and
in doing so change the patterns of society. Like business entrepreneurs, they combine
creativity with pragmatic skills to bring new ideas and services into reality. Like community activists,
they have the determination to pursue their vision for social change relentlessly until it becomes
a reality society-wide.
While the term "social entrepreneur" is relatively new to New Zealand, it is certain to become
a more common term to describe the contribution of the dozens of New Zealanders who are
developing innovative solutions to our social challenges.
- At the last Budget announcements, Social Services and Employment Minister
Steve Maharey announced a scheme for supporting NZ social entrepreneurs as part of his
overall strategy for fostering "pathways to opportunities". His scheme will identify 15-20 "movers
and shakers" in the community sector each year, and give them the opportunity to take time out
from their work to develop their skills and capabilities.
In many ways, the announcement of this scheme reflects the popular interest in
fostering social entrepreneurs by "Third Way" Labour politicians throughout the western world.
Support for these social "change-makers", and the programmes and institutions they create,
certainly gained momentum under Tony Blair's British government during the late 1990s. And they
have backed their interest with real resources: last year, the UK Millenium Commission allocated
a £100 million endowment fund to a new foundation especially set up to foster social
- This political interest and support has been driven by the need for governments to
find fresh answers to the welfare challenges of this 21st century. Charles Leadbeater, an associate
of Tony Blair's favourite think-tank, Demos, argues that the present welfare state is ill-equipped
to deal with many of the modern social problems it has to address. And the state seems unable
to pursue radical reforms which could make welfare more affordable and more effective.
Leadbeater: "At the risk of caricaturing its complex beginnings, the welfare state was
designed for a post-war world of full employment, stable families and low female employment.
Those underpinnings have been destroyed by international competition and social change. New
social problems of single parent households, drug dependency and long-term unemployment
have emerged which the traditional welfare system is not designed to deal with."
"If we are to develop a more effective and affordable problem-solving welfare system we have
to support social innovation. And one of the best ways to do that is to support the work of
social entrepreneurs both within and outside the public sector..."
- DEFINING SOCIAL ENTREPRENEURS
The title of "social entrepreneur" may be new, but these people have always been with
us, even if we did not call them by such a label.
While the concept is gaining popularity, the title has already started to mean different things
to different people. Some people, like Charles Leadbeater, use the term to primarily focus on
the fostering of innovation and social change. Others use the term to describe anyone who starts
a community-based not-for-profit organisation. Still others associate it exclusively with
not-for-profit organisations starting for-profit business ventures. The term has also been used to refer
to business leaders who integrate social responsibility into their organisations.
Perhaps we can expect to see a continuing debate on definitions, especially as the concept
starts to attract more attention from politicians and leading philanthropic foundations.
Community activists, social service providers and government fieldworkers will be quick to appropriate
the new terminology in order to raise the profile of their projects for potential funders.
Many community-based social entrepreneurs, when asked to define the term, point to
inspirational historical figures as diverse as the Indian Emperor Ashoka, Martin Luther King,
Fritz Schumacher, or Florence Nightingale (see box, below).
But this can overshadow the everyday reality that most communities and many
government agencies have a social entrepreneur in their midst people who are not often fully
recognised and appreciated for the unique mixture of skills they bring to establishing new social
- Father Nic Frances, Executive Director of the Brotherhood of St. Laurence in
Melbourne, remembers the time he was first called a "social entrepreneur" ... on a radio program six
Frances: "The minute I heard the phrase I liked it, and thought it described me. It suddenly
encapsulated my training in business, my experience as a hotel and marketing manager and
stockbroker, my work as a founder of a welfare organisation, and my journey through ordination
to become an Anglican priest. At the time I was trying to use all these skills and all of my
learning to draw in as many people as possible to respond to the social injustice I saw around me."
"Six years after hearing that term "social entrepreneur", I now think there is very little new
about it. It is almost what we called in the 1970s and early 80s "bloody good community work"
with the added difference that it is not just about us as welfare workers going into a poor
community and supporting it ... it is being in that community and harnessing the input of every one in
sight local government, business, statutory authorities, neighbours anyone with an interest
in tackling poverty."
- Beyond the debate on precise definitions, the growing body of literature on social
entrepreneurship shows a remarkable agreement about the qualities and character of these unusual
They are one of the most important sources of social innovation, creating new
welfare services and new ways of delivering existing services.
They create role models that will be a "pattern for change" elsewhere in society.
They can be found right across society in the traditional public sector, in some large
private sector corporations, and at the most innovative edges of the voluntary and community sector.
They excel at spotting unmet needs and mobilising under-utilised resources
people, buildings, equipment to meet these needs.
They are capable of creating impressive schemes with virtually no resources.
They are adept at building networks and generating practical good will.
They thrive on the complexity which more static organisations find difficult to handle.
They are determined, ambitious leaders, with great skills in communicating a mission
and inspiring staff, users and partners.
They often find ways of combining approaches to social challenges that are
traditionally kept separate.
They often create flat and flexible organisations, with a culture of creativity and a core
of full-time paid staff.
Their projects are capable of producing a huge diversity of financial, human and
organisational "outcomes" ... many of which were unanticipated when they started.
- Bill Drayton, founder of the Ashoka Fellows, says that identifying and solving
large-scale social problems requires a social entrepreneur because only the entrepreneur has the
committed vision and inexhaustible determination to persist until they have transformed an entire system.
Drayton: "The scholar comes to rest when he expresses an idea. The professional succeeds
when she solves a client's problem. The manager calls it quits when he has enabled his organization
to succeed. Social entrepreneurs go beyond the immediate problem to fundamentally change
the system, spreading the solution and ultimately persuading entire societies to take new leaps."
- Who was Ashoka?
- THE ASHOKA STORY
Bill Drayton has been one of the earliest pioneers in the field of fostering social
entrepreneurship. In the early 1980s, he was a McKinsey & Co. consultant and assistant administrator
at the US Environmental Protection Agency, when he started to fully recognize the power of
individual innovation in addressing social problems. This led him to pilot the idea of Ashoka
in India, with a budget of less than $50,000. His efforts attracted a MacArthur Fellowship,
which enabled him to work full-time on building the new organisation.
Rather than raising money for aid programmes, Ashoka focuses on identifying social
entrepreneurs who are already working for change. It has a multi-level process for selecting the
Fellows, involving nominators, researchers, interviewers, visits to work sites and reviews by
professionals from each country. This process has seen Ashoka elect over 1,100 Fellows in 41 countries,
and today it "invests" more than $7 million a year in supporting these change-makers. Almost all
of Ashoka's internal organisational work is done by volunteers. Ashoka does not accept
government funding, but raises its grant money from private individuals and philanthropic foundations.
The Fellows are active in education, health, housing, economic development, the
environment, and human rights ... mostly in the less-industrialised world and in Eastern Europe. Once
selected, Ashoka elects the individual to the Fellowship for life and provides a subsistence income for
an average period of three years. The living stipends range from $2,500 to $20,000 a year,
and enable the social entrepreneurs to focus full-time on their ideas and projects.
This financial support, given at the right time, can be critical to the process of innovation.
As Louis Harris, founder of the US Harris Poll and an Ashoka supporter, says: "Change
happens because a few people think differently and then take action. I back Ashoka, because it backs
the courageous few, and it does so when these people are taking their biggest risk. That's when
a small investment in launching a new way of teaching kids, or a new environmental solution,
can truly change how society works..."
- Bill Drayton observes that the past two decades have seen an extraordinary explosion
of entrepreneurship and competition in the social sector. Drayton: "The social sector has
discovered what the business sector learned from the railroad, the stock market and today's digital
revolution: That nothing is as powerful as a big new idea if it is in the hands of a first class
"Each such entrepreneur and idea that succeeds, moreover, encourages many others to
care for society's wellbeing and to champion changes they feel are needed. The multiplication of
such decentralized concern and effective action is, of course, the essence of the democratic
Source: Ashoka: Innovators for the Public
|THE LIFE CYCLE OF SOCIAL ENTREPRENEURS
- acquire skills and experience
- learn the field, problems, players and existing approaches
- conceive of, investigate, and flesh out new ideas
- devote 100% of energy to implementing new ideas
- create motivational base of operations
- test and refine role model programmes
- attract support
- spread ideas to regional and national levels
- consolidate institution and funding
- ideas are recognised and respected
- innovations are widely accepted as a new
pattern in society
- social entrepreneur is recognised as a change-maker in their field
- social entrepreneur may start other innovations and/or play a broader leadership role in society
- SOCIAL ENTREPRENEURS IN BRITAIN
The surge of interest in social entrepreneurship in Britain came with the election of
the Labour government in 1997, and the publication of a Demos think-tank report (see
review) which profiled several leading British change-makers. Three of the pioneering Londoners in
this report included Andrew Mawson, Adele Blakebrough, and Helen Taylor Thompson.
At Bromley-by-Bow in East London, Andrew Mawson had inherited a derelict Church
and transformed it during the last 15 years into a remarkable integrated community project
bringing together art and craft studios, a nursery, community care, youth and enterprise activities,
fitness facilities, a cafe, a Bengali language programme, a three-acre park, sheltered housing and a
full range of health services.
At Kingston-upon-Thames, in south-west London, Adele Blakebrough was Director of
the Kaleidoscope Project, one of Britain's largest centres for the treatment and support of
Helen Taylor Thompson had taken over an unwanted NHS hospital at Hackney in East
London and turned it into a pioneering, world-class hospice for AIDS patients.
- In April 1998, these three social entrepreneurs established the Community Action Network
(or CAN) as a learning and support network for fellow social entrepreneurs. It has rapidly grown
to become a role model in the field.
CAN's essential function has been to link its members via an electronic intranet,
supported by face-to-face meetings. Through this electronic linkage, CAN members create their
own marketplace to trade information, contacts, services and goods.
CAN has also been establishing Action Centres which provide inexpensive office space
and shared resources for social entrepreneurs and their organisations. The first has been set up in
the Haymarket area of London, and others are now being planned in Scotland, Wales, North
England and Northern Ireland.
for more information contact www.can-online.org.uk
- More recently, a major new Foundation has been established in Britain to
co-ordinate funding and support for social entrepreneurs. The unLTD Foundation is based on a
partnership between CAN and Ashoka (UK) Trust, as well as Changemakers, Comic Relief, the
Scarman Trust, the School for Social Entrepreneurs and the Social Entrepreneurs Network in Scotland.
The new Foundation has successfully won the bid to take over a £100 million pound
endowment fund from the UK Millenium Commission. unLTD has developed a three-level strategy to
"staircase" the funding of social entrepreneurship throughout Britain.
Level one involves giving as many people as possible the chance to do something for
their community with the support of cash, training, advice and mentoring. Funding up to £2,500
The second level is for projects involving full time employment on ideas that develop from
level one. Funding provided for this is up to £15,000.
The third level of projects will be supported by a Social Venture Fund which will finance
major initiatives to an early stage of development. unLTD will also act as a broker between
other private investors and the social entrepreneurs.
For more information, see www.unltd.org.uk
- THE NETWORK IN AUSTRALIA AND NEW ZEALAND
The success of CAN in Britain has attracted a great deal of interest in Australia,
especially after Australian Labour MP Mark Latham invited Andrew Mawson on a three-week
speaking tour in April last year.
This led to the launch of a two-year project, backed by the Brotherhood of St Laurence and
the Melbourne-based Hotham Mission, to spark the development of Australian social
enterprises, and to establish an Australian network of social entrepreneurs (modelled on CAN).
The inaugural meeting of the Australian Social Entrepreneurs Network (SEN) was held in
Sydney in February this year. This conference was attended by over 500 people which
included leaders from the public and private sectors as well as politicians. A follow-up conference is
being held in Brisbane at the end of June.
For more information on SEN, contact Vern Hughes email email@example.com or
- Several NZ members of Commact, the Commonwealth community economic
development association, have attended these inaugural meetings of SEN. Commact has also
been commissioned by the Community Employment Group (CEG) to hold a series of meetings
around NZ to report on the Australian initiatives, and to stimulate local discussions on the concepts
of social entrepreneurship. Commact and CEG are following this up with a national conference
in Wellington in November, with speakers from the UK, USA and Australia.
Conference on Social Entrepreneurs hosted by CEG in partnership with COMMACT Aotearoa, Wellington 22-23 November 2001. For further information and registration details contact CEG at P O Box
3705 Wellington, phone 04-914-4900, fax 04-914-4901, email firstname.lastname@example.org or visit
the CEG website. A registration form is available from the website www.dol.govt.nz/CEGsocial.htm
- SUPPORTING SOCIAL ENTREPRENEURS
These support networks may be coming at just the right time. A New Economics
Foundation report (see review) in 1997 concluded that while social entrepreneurs are more widely
recognised as catalysts for innovation, their work is still often done in the face of frustration
The report identified several key elements of assistance that social entrepreneurs require:
recognition and status ... not merely for the individual's self-gratification, but as a means
of levering support for their initiatives.
personal financial support ... to enable them to pursue their central vision.
peer group support ... with other social entrepreneurs to share projects, experiences and ideas.
mentoring ... from individuals with practical experience relevant to their immediate and
long-term strategic needs
specific training ... particularly in areas such as organisation development and finance.
- SOCIAL VENTURE PHILANTHROPY
A growing trend in supporting social entrepreneurship can be found within a new
generation of "venture" philanthropists who want to see a better strategic use made of their
donations and grants. Rather than simply pouring money into the holes opening up in our welfare
state, many corporate and private foundations are now seeking to have a greater impact on
social problems by directly funding the social entrepreneurs identified as driving change and
One of the main reasons behind this change of focus amongst philanthropists is the huge
proliferation of citizens groups around the world in the last two decades.
David Bornstein, author of a forthcoming book on social entrepreneurship, says that as many as
a million new organizations have been established around the world since the 1970s to focus
on issues such as the environment, human rights, health care, education, disability,
democracy, women's rights, and poverty. This explosion has not been matched by an equal growth in
philanthropic backing: in the United States, while the number of nonprofit organizations has grown
by 55% since 1987, philanthropic giving has grown by just 15%.
Bornstein: "With new organizations outpacing resources, governments, foundations, and
private citizens have to be judicious about allocating their support. Not every investment will yield
a worthwhile social "return." The whole venture industry is grounded in the twin assumptions
that: 1) it is possible to identify sources of great potential, even in very young businesses; and 2)
there is simply no more powerful way to invest money than to place it in the hands of an
entrepreneur with a good idea. These insights are beginning to invade the social arena..."
"Of the million new organizations in the world, which ones will succeed in changing systems
and bringing real improvements to large numbers of people? The best guide is to look for the
social entrepreneurs behind them to systematically search for the restless, tenacious individuals
who have a broad vision for social change and who simply will not give up until they have built it."
- ENTERPRISE AND THE PUBLIC SERVICE
Charles Leadbeater believes that the public service is just as much in need of
fostering the spirit of enterprise, and can learn a great deal from the innovations of social
entrepreneurs. But creating an environment where civil servants themselves think "outside the square"
and learn to take risks is the first major hurdle to address.
Leadbeater says that traditional methods of holding public servants to account for how
they spend public money stress the virtues of predictability and standardisation. A fair and
honest public service depends upon people following rules, not bending them.
Equally, the public sector does not reward success. Public service innovators who find a
cheaper way to deliver their services may find themselves rewarded with lower budgets or more work
for the same pay.
Leadbeater: "Political leaders have much lower tolerance levels for failure than their
counterparts in business. Even the smallest mistakes in the public sector can be magnified into an
embarrassment at least, a scandal at worst. It is little wonder then that innovation in the public sector
lags so far behind the private sphere the space for innovation is minimal, the costs of failure
alarming, the incentives feeble, the personal rewards uncertain."
In the past, Labour politicians have criticised the private sector for investing too little in
research and development. Yet Leadbeater points out that the public sector would score very poorly
on research and development, compared with most large private sector companies. He asks:
"Where are the public sector's innovation centres, its business incubators, the science parks
developing the public services of the future? "
the establishment of a string of new business incubators across the public sector;
the creation of a dedicated innovation and venture fund for the public sector;
all public sector budgets to include some provision for research and development;
the establishment of social innovation transfer schemes (where the innovations coming
from community-based social entrepreneurs can be more easily identified and adopted).
Charles Leadbeater, "Sir Humphrey Needs Venture Capital"
New Statesman 27th November 2000, available at www.newstatesman.co.uk/200011270022.htm
- FLORENCE NIGHTINGALE
"I think one's feelings waste themselves in words ... they ought all to be distilled into
actions which bring results."
Florence Nightingale 1820-1910, English Nurse and reformer
ALTHOUGH SHE WORKED in a completely different field, Florence Nightingale was
an inspiration behind the establishment of The Jobs Research Trust in 1994. Throughout
modern history, this remarkable woman has been considered a role model for social entrepreneurs.
Her fame as "the lady with the lamp" grew out of her compassionate care for British soldiers
in Turkey during the Crimean War. The hygienic standards she introduced reduced the death rate
in British military hospitals in Scutari from 42% to 2%.
After her return to England she fought for the rest of her life to professionalise the field of
nursing. She established standards for sanitation; introduced such innovations in hospitals as
patient call lights, dumbwaiters, and hot and cold running water on every floor; and systematized
the training of nurses.
Nightingale wrote 150 books and monographs and 12,000 letters. She was also a
"passionate statistician" and invented the pie chart. Through relentless lobbying efforts, and the skilful use
of influential contacts, she got her ideas adopted first by the British Army and eventually by
the medical establishment.
The founding Jobs Research trustees felt that Florence Nightingale was a powerful example
of how to work for positive change by distributing good and timely information. This has been
a direct influence on the creation of The Jobs
Letter, and also the inspiration behind our
Trust philosophy of "...not telling people what to think, but giving people the tools to think with."
Trustee Jo Howard writes: "By working like her, we in the Trust hope we will go some way,
at least, to being as effective in our own field as she was in hers..."
For more information, see www.jobsletter.org.nz/jrtflorence.htm
BILL DRAYTON NAMED the Ashoka organization after a 3rd Century B.C. Emperor of
India, who is remembered as one of the world's earliest and most impactful social innovators.
After uniting the Indian sub-continent by force, Emperor Ashoka was stricken with remorse and
Ashoka then dedicated the rest of his life to the peaceful promotion of social welfare,
economic development, and tolerance for all religions. He instituted the region's first medical
services, launched a vast well-digging program, and developed the first comprehensive infrastructure
in southern Asia. He also planted thousands of shade trees along India's hot and dusty roads.
For more information, see www.ashoka.org
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