Social Entrepreneurship: An Asian Perspective Prof. Marie Lisa M. DacanayAsian Institute of ManagementCivil Society Forum, IMF-WB Annual Meeting14 Sept 2006

Social Entrepreneurship (SE): An Asian PerspectiveContext of presentationA look at some SE initiatives in AsiaUnderstanding SE in Asia Challenges and proposals for advancing SE in AsiaHarnessing SE for the MDGs in Asia

Context: AIM-CAFO Partnership in Social Entrepreneurship Research (AIM/CAFO)Cases on significant practicesCreating a Space in the Market (2004)Education (AIM)Degree and non-degree programs Master in Entrepreneurship for Social and Development Entrepreneurs or MESODEVNetworking and Outreach (AIM/CAFO)International Workshop on Social Entrepreneurship in Asia (July 6-8, 2006)

A Look at Some SE Initiatives in Asia

KOOL-NE (Philippines)Hagar (Cambodia)PEKERTI (Indonesia)Basix Group (India)Partners for Health (Thailand)

A Look at Some SE Initiatives in Asia: KOOL-NE (Philippines)Started 2002Joint venture between PRRM (NGO) & KALIKASAN (farmers)Production, processing and marketing of organic riceSecond largest producer-distributor in Luzon islandFarmers: increased incomes from lower cost of inputs and premium pricing Also contributes to environmental health and soil rehabilitation Total assets: US$110,000 Farmers equity: 10%; Annual sales: about USD91,000

A Look at Some SE Initiatives in Asia:Started as shelter for women by Pierre Tami in 1994Mission: Prevention, rehabilitation and reintegration of rural women and children who migrate to cities in search of better life. Now a social enterprise system with non-profit arm providing initial education and vocational training and commercial enterprises that provide employment and additional vocational training to enable women to have independent and productive livesCommercial enterprises: Hagar Soya, Hagar Catering, Hagar DesignWorking with other shelters to expand in Southeast Asia

A Look at Some SE Initiatives in Asia: Partners for Health (Thailand)

Social enterprise system serving persons living with HIV-AIDS (PLWHA): Health component with outreach care and psycho-social support: managed by Thai Business Coalition on Aids (TBCA) Income generating component providing marketing and retail support for PLWHA-made textile and handicrafts: managed by Center for Peoples Families Affected by Aids (CPA) Positive Marketing Co. Ltd. (PMCL)

A Look at Some SE Initiative: Partners for Health (Thailand)Set up as public-private-community partnership project in Nov 2003; cost USD117TPartners: UNESCAP, Ministry of Public Health, Bangkok Metropolitan Authority, TBCA and the CPAObjective: to increase outreach and effectiveness of govt HIV-AIDS programsPMCL sales (2004) : USD203T, mainly serving events-based market; 35% of profits go to health componentExpected to be self-sustaining by 2008; By May 2005, deemed successful for replication & scaling up

A Look at Some SE Initiatives in Asia: PEKERTI (Indonesia)Yayasan Pekerti (1975): not-for-profit foundation set up by 5 NGO activistsMission: increase standard of living of marginalized artisans & establish fair, democratic involvement in their economic activities; part of IFATPekerti Nusantara (1979): commercial arm for export market (assets: USD389T by 2002)Pekerti Cooperative (2000): working capital forpartners

A Look at Some SE Initiatives in Asia: PEKERTI (Indonesia)APIKRIPartner of Pekerti composed of 200 artisans in Yogyakarta 1987-1990: Pekerti helped set up Apikri Foundation and Apikri Cooperative w/c now conduct self-sustaining development and trading activitiesSales by 2003: USD277 thousand

A Look at Some SE Initiatives in Asia: Basix Group (India)

Rural livelihood promotion institution founded in 1996 by NGO leadersBank and non-bank institutions providing livelihood financial servicesNot-for-profit agency providing agriculture, business and institutional devt services Clients: poor & employers of poor in agriculture, non-farm and allied sectors

A Look at Some SE Initiatives: Basix Group (India)Targets large numbers of poor in economic subsectors with growth potential: dairy, cotton, rural retailingOutreach (2003): 10,000 villages, 25 districts, 6 statesMicrofinance outreach: 145,500Livelihood promotion services outreach: 22,000Assets- USD9.2 million (2003); loan portfolio- USD 13 million with 97% on-time recovery rateImpact assessment (2001): 68% clients poor; 52% with increased incomes (control group-29%); 37% with increased employment (control group-26%)

A Look at Some SE Initiatives in Asia: Basix Group (India)SARVODAYA NANO FINANCE LTDNon-bank financial institution set up by Basix to service self-help groups (SHGs) of poor women July 2001: devolved ownership to community-based mutual benefit trusts of 5,000 SHGs of poor women in Tamil Nadu3-year agreement for Basix to provide management services

Understanding SE in AsiaDefining social entrepreneur Social enterprise vs traditional business enterpriseSocial enterprise development strategiesMicro and macro perspectivesDiffering macro contexts

Defining social entrepreneurDevelopment change agent working in the market as an arenaInnovative, opportunity-seeking, resourceful person, group or institution Leads creation of enterprises, enterprise systems or enterprise development programs demonstrating positive development impact

Social enterprise vs traditional business enterprise

Social enterprise vs traditional business enterprise

Social enterprise vs traditional business enterprise

Social enterprisevs traditional business enterprise

Social Enterprise Development Strategies

Resource Mobilization StrategiesSocial Inclusion StrategiesIntermediation StrategiesEmpowerment Strategies

Social Enterprise Development Strategies:Resource Mobilization StrategiesPrimary concern: generate income from sale of products or services to finance development agencys operations or core program Exemplified in part by Partnersfor Health Another example: Bina Swadaya Tours plus 8 other subsidiary companies provide 90% of Bina Swadayas annual budget of USD5million (Indonesia)

Social Enterprise Development Strategies: Social Inclusion Strategies

Address need for disadvantaged or excluded groups to regain their dignified place in society Exemplified by Hagar and Partners for Health

Social Enterprise Development Strategies: Intermediation Strategies

Provides primary stakeholders access to economic or social servicesTwo types: functional intermediation and progressive intermediation Variations of progressive intermediation exemplified by Pekerti and BasixExample of functional intermediation: most MFIs

Social Enterprise Development Strategies: Empowerment StrategiesAddress need for poor or marginalized to reap maximum benefits from owning and controlling social enterprise themselvesTwo types: direct empowerment and devolutionary empowerment Direct: exemplified by cooperatives Devolutionary: exemplified by KOOL-NE

Social entrepreneurship: micro and macro perspectives Micro perspective: art of wealth creation with multiple bottom linesMacro perspective: strategy to democratize market economies Participation by the poor and marginalized sectors as owners, decision makers and stakeholders (social dimension)Protection and rehabilitation of societys life support system (environmental dimension)

Differing Macro Contexts of SE in AsiaDeveloping market economies: POVERTYSocialist countries in transition to market economies: humane market economies or MINDFUL MARKETS Developed/affluent market economies: SOCIAL INCLUSION ++assisting efforts at poverty reduction and building mindful markets in other countries

Challenges in Advancing SE in AsiaSocial marketing: Lack of understanding by development sector of market as arena for change Capacity building: Low capacity for building and scaling up social enterprises among civil society actors Scaling up and mainstreamingLack of access to financial capital for scaling up Limited involvement of the business sector Absence of supportive policy environment

Concrete Proposals to Advance SE in AsiaRegional center for social entrepreneurship in Asia to support country level initiatives in response to challenges Social enterprise capital fund (s)

Harnessing SE for the Millenium Development Goals (MDGs) in AsiaMDBs may want to consider harnessing social entrepreneurship to improve performance vis a vis the MDGs in Asia, home to 2/3 of the worlds poorest. Proposal: Invest in a Social Enterprise Capital Fund to support innovative tri-sectoral partnerships and scale up existing initiatives directly responding to the MDGs.

Thank You!