Social business in a capitalistic society

I saw Muhammad Yunus at Town Hall Seattle a couple Sundays ago.  The 2006 winner of the Nobel Peace Prize, Yunus was speaking about his new book Building Social Business.  Hearing the talk I reflected on the Red Winged Leadership Award I recently participated in, and how its objectives are aligned with a growing push for sustainability and social impact in business. 

 

 

Aligning ROI by the impact an investment has on society is certain to cause some confusion, or at the very least a few questions of, “what’s the point?”  Let my investments be for my benefit, and my charitable dollars be for good deeds.  …I believe the concept of social business is salient because it promotes reinvestment in social impact.  Say I have $1,000 to designate to a social cause, and choose a social business that has a plan to achieve the goal and the acumen in see it to success. 

 

Eventually the business thrives and I am repaid my initial investment of $1,000, which I may now designate to another social cause.  I am no longer incurring additional out-of-pocket charitable contributions, as I have designated my initial investment of $1,000 as somewhat of a sunk cost.  (I use the term loosely.)  In essence, my charitable dollar is self sustaining – that is as long as I invest it carefully. 

 

 

With this consideration I believe the social business model can prosper in a capitalistic society.  As Yunus puts it, social business “[…]does not intend to monopolize the market and take the existing option away.  It adds to the competition.” 

 

 

It reminds me of the coop movement in which credit unions are built.  But that’s another posting for another day.