SocialBusiness

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SocialBusiness is a concept proposed and implemented by the Peace Nobel Price winner MuhammadYunus. Basically it can be considered identical to a "commercial non-profit organisation".

Definition: A SocialBusiness is a corporation that pays no dividends to the capital shareholders. It offers its products and services under market conditions, and uses its profits only to expand and improve. Measures are taken that the success of a social business can't be exploited.

The main advantage compared to non-profit help organizations is, that a SocialBusiness doesn't need a constant stream of sponsoring or funding to stay workable. It is a sustainable component of economy.

Usually social business are created because of some market failure.

One interesting question is, how to institutionalize social business, to become independent from voluntary decisions that can be turned over. This is different from country to country, depending on the legal patterns that are available to create organisations and fix their objectives, while not restricting their ability to survive and serve their original purpose in changing conditions.

Related concepts: SocialEntrepreneurship

Yunus defines SE as an initiative that has a social objective, whether economical or not, whether profit-making or not. If one follows this, each SocialBusiness is a SocialEntrepreneurship, but not each SocialEntrepreneurship is a SocialBusiness. SocialBusiness comes out as a subset of SocialEntrepreneurship.

There is a certain fuzziness of concepts, so one can easily think that SocialBusiness and SocialEntrepreneurship are one and the same.

Related concepts: CSR Corporate Social Responsibility

CSR is a way to integrate social objectives with a commercial business, based on voluntary decisions. This may be done in primary business (an energy producer pushing new sustainable energy sources) or in a secondary way (McDonalds? funding e. g. child cancer research).

CategoryEconomy

Discussion

SamRose -- Sat Feb 13 04:13:28 2010

What do you think about this?:

http://forwardfound.org/blog/?q=comparing-business-development-paradigms

NathanielThurston -- Sat Feb 13 22:33:27 2010

Sam, this is an interesting link. In reference to "the key ingredient in the solution is information transparency", have you seen LiquidityOfTrust?