Is our society better off than it was 100 years ago, 500 years ago or 1000 years ago? This question may sound inane to most of us. The answer is a resounding ‘yes’. The world has progressed in leaps and bounds. We now have the power of connectivity, access to vast information through the internet, mass transportation, cures to deadly diseases through medicine and even the prospect of flying in passenger space crafts to the outer reaches of earth. Here’s an interesting map of milestones
The above map, makes it amply clear that the bulk of human progress (seen in the map as white-coloured milestones) across Food & Agriculture, Health, People & Society, Environment and Science and technology since 1 CE have occurred over the last 250 years. Forces unleashed by Industrial revolution and globalization have unarguably driven this change within various societies throughout the world. While the industrial revolution brought scale, innovation and rise in productivity, globalization created a single market for capital, goods & services and knowledge. Popularly, these two phenomena are attributed with prosperity and better standard of living for mankind.
The World is A Highly Unequal Place
While we celebrate the phenomenal strides in human progress, one question that begs answers is: Why is 77% of world population still at the bottom of the pyramid?
Here’s how income is distributed in the world population.
Source: The Have and the Have Nots by Branko Milanovic
Some of the best economists have struggled to comprehensively answer this question. Clearly, a vast majority of peoples in the world have not been able to take advantage of the progress made so far to better their lives. Inequality in incomes across countries is at its highest today though it may not be rising at a pace it once did.
“For too long, we have seen capitalism go unquestioned and witnessed unbridled markets overlook or exploit low-income communities, too often creating a cycle of poverty and inequality,” Jacqueline Novogratz, founder and CEO of Acumen once famously remarked.
An ideal world that is balanced, equitable and fair to majority of its people, would most probably have the following distribution of income.
The above situation may be very difficult to achieve, simply because the world is not a monolithic place. It is a composite mix of diverse cultures, religions, economic philosophies and several competing interests. Individual societies will have to overcome their social handicaps and economic constraints to create opportunities for the masses to move up the ladder and into the middle.
It Needs More Social Entrepreneurs
The world needs large-scale change, one that’s based on inclusive economic growth, poverty alleviation, access to basic healthcare, water & sanitation, education, and on principles of social justice and sustainable development. This change started a while ago. Bill Drayton who founded Ashoka Changemakers first coined the term ‘social entrepreneur’ in the early 80s to describe enterprising individuals trying to solve some of the world’s pressing social problems. Since then Ashoka has identified and supported more than 3000 social innovators, changemakers and problem-solvers throughout the world with more than 300 coming from India alone. A social entrepreneur primarily applies himself to solving a single or multiple socio-economic problems through resourceful and positive intervention by applying social innovation and principles of modern business management to social impact. He is sufficiently different from a conventional business entrepreneur in that the key force driving him is the need to do social good. Thus he changes not only the paradigms of business world but also those of philanthropy.
Last 10-15 years have witnessed a steady emergence of social entrepreneurship not only internationally but also in India. Ecosystem around social entrepreneurship has been continuously maturing, particularly because of rise of impact investors, incubators, specialized degree courses, media coverage of this sector and support through government regulations. Incubators and accelerators like Villgro, UnLtd, Upaya Social Ventures, Deshpande Foundation and Marico Innovation Foundation to name a few are highly active and play a key role in development of social entrepreneurship in India. The fact that India with its pluralistic and complex society, very high economic inequality and low human development index has one of the highest numbers of social entrepreneurs in the world signifies the dire need of social entrepreneurship as a way forward.
How Social Entrepreneurs Solve Inequality
- Empowerment Over Exploitation
Throughout the initial decades of industrialization and even through most of 20th century, capitalists built their businesses by exploiting workers. While this phenomenon dipped significantly over time due to passage of laws and creation of unions, many industries still look at workers and human labour as an expendable resource. This results in large-scale layoffs and unemployment as soon as profitability is endangered.
Megha Gupta is the founder of Dharavimarket.com. It’s a social enterprise that provides livelihood opportunities for artisans in Dharavi, India’s biggest slum.
“In my business, it’s about mutual respect between the artisans and me. They are not just a part of my supply chain,” Megha told me once.
Megha Gupta; Image credit: Rohan Potdar
Social entrepreneurs believe in empowering communities at the bottom of the pyramid through job creation and access to basic services to give them a shot at better life. Purpose of their vision almost always triumphs their pursuit of profit.
- Entrepreneurship over Charity
History amply testifies that doling out handouts and distributing free goods is not a sustainable way of pulling masses out of poverty and social misfortune. Instead assisting target communities to help themselves through self-employment and entrepreneurship opportunities transfers the control of their destinies to them.
“Through our franchisee model, we identify wastepickers who can become entrepreneurs by deploying trucks for primary waste collection,” says Shekar Prabhakar, Co-founder of Hasiru Dala Innovations, a waste management company based in Bangalore.
He is of a firm view that spawning entrepreneurship at the grassroots levels brings dignity to its members and motivates them to lift themselves up from their poverty.
Shekar Prabhakar; Image credit: Rohan Potdar
Empowerment and entrepreneurship go hand-in-hand and social entrepreneurs know this very well. Their problem-solving approach thus revolves around offering rewarding opportunities to target communities for better socio-economic prospects through hard work over sympathy.
- Passion over Profit
Profit is the prime driver of any business. It helps the business grow, attract talent and make wealth for its shareholders. While this has been established as an absolute truism, the society needs entrepreneurs and innovators who are driven by passion for social good and equity.
Bhushan Trivedi, Founder of Piconergy, is highly passionate about solving the problem of energy access for the urban poor. He has designed a solar-based lighting solution for people who cannot afford conventional grid energy.
He cites an interesting anecdote, “A fisherwoman once told us that our light bulbs are not bright enough for her business. We had to re-design our entire circuitry.”
Bhushan may not have built an instantly profitable venture but he has gained immense knowledge of the needs of his target consumers.
Bhushan Trivedi (L) Image credit: Rohan Potdar
Passion to solve a social problem overrides the temptation to make profits for a social entrepreneur. This philosophy of doing business for social impact, if scaled up can be a powerful antidote to inequality.
World is simmering with challenges- climate change, income inequality, social injustice and depravity. Responses to these challenges cannot be a continuation of old school capitalist approach. We need a different type of response. Social entrepreneurship with its philosophy of sustainable and inclusive development and positive social impact is what the world needs.