Greater support from the public, governments and investors is needed to boost the work of entrepreneurs using business for social good, industry activists and organizers said after a Thomson Reuters Foundation poll highlighted these as key issues.
While progress overcoming those obstacles is healthy and growing, they said at Social Capital Markets (SOCAP) — the largest annual conference of social entrepreneurs and investors, which this year attracted — that more could be done to support what is seen as a new way of doing business.
The poll released this week of almost 900 social enterprise experts in the world’s 45 biggest economies found the vast majority (85 percent) said the sector was growing.
However, nearly 60 percent of experts cited a lack of public understanding, access to investment and selling to governments as the biggest challenges that could hamper growth.
“There’s very limited awareness of what social entrepreneurship is,” said Asher Hasan, whose Pakistan-based company Docthers works with corporations in Mexico and Chile to provide insurance to suppliers, factory workers and others in their supply chains.
“They understand traditional philanthropy. They understand capitalism. They don’t understand the blend. There’s a lot of market development that needs to be done to help the mainstream understand,” Hasan said.
A social entrepreneur is typically someone who uses commercial strategies to tackle social and environmental problems, combining social good and financial gain.
Attendees at SOCAP said governments are promoting social entrepreneurship and schools are teaching it, while enterprises are finding fresh, creative ways to obtain credit and financing.
Jennifer Kushell, founder of Your Success Now (YSN), which connects youth with educational and career opportunities, said US President Barack Obama had been supportive, promoting so-called “entrepreneurship diplomacy,” a strategy to find common goals in conflict areas.
YSN is designing a social entrepreneurship curriculum for business schools, she said.
Seeking to support social entrepreneurs, Autodesk Inc, a maker of software for architecture, engineering and other industries, provides free software and licenses, said Pam Henchman, who manages the entrepreneur impact program at the Mill Valley, California-based company.
“I definitely hear about finance and access to capital being a real problem,” she said. “We don’t want the next Thomas Edison to walk by, and he didn’t get the software that he needed because he didn’t have enough money to buy a license.”
Banks are training loan officers on the risks involved in lending to social entrepreneurs, said Marina Leytes, a consultant with Impact Alpha, an online media site covering social and environmental business.
“More and more local banks are entering this sector, providing loans to smaller enterprises,” she said. “It’s a way for them to gain more clients and expand their operations.”
The Global Alliance for Clean Cookstoves recently worked with the government of Kenya to eliminate a tax on cookstoves going to women in poor regions, said Stevie Valdez, manager of the Washington-based group’s impact investing and market development.
The group aims to provide cleaner stoves and fuel to the 40 percent of the world’s population that uses solid fuel and cooks over open fires, creating environmental and health problems, Valdez said.
“We need the entrepreneurs really getting out there with great products, and we need the governments really making an effort to say: ‘You know what? We want healthier products,’” she said.
The conference brings together investors and entrepreneurs to address issues such as poverty, climate change, job creation and food supplies.
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