Social Entrepreneurship – The Third Sector

Social entrepreneurship is a rapidly emerging field that has extended the concept of entrepreneurship by including the social dimensions of entrepreneurial ventures. In 2006 Muhammad Yunus and Grameen Bank of Bangladesh were awarded Nobel Prize for their extraordinary efforts to promote economic and social development in the present section of society. This event gave a tremendous momentum to social entrepreneurship. This was the initiation. Many more profit and non-profit enterprises have begun to identify them as a Social Entrepreneur. , Skolls Foundation, Schwab Foundation and Aravind Eye Hospital are the best examples of Social Entrepreneurs. I will suggest readers to go to the respective websites and read about these ventures to understand the concept of Social Entrepreneurship more clearly.

Social and Environmental problems such as environmental denudation, poverty and human rights violations have neither been addressed satisfactorily by the government nor has there been a substantial effort by the business community. If we observe the history, we see only non-governmental and non-profit organisations have taken interest in solving such problems. This sector has worked most of the time independently from any of the sectors. Social sector is more or less at its own.

Whether government supported or not, the social sector has grown substantially over the time. In US alone there are 1.5 million non-profit organisations with combined annual revenue of approximately US$ 700 billion (National Center for non-profit Boards, 2006). This is more than the gross domestic product of Brazil, Russia or Australia. Moreover the social sector controls over US$ 2 trillion in assets.

Despite its substantial economic importance, the social sector is not acknowledged as a sector in the traditional economies. The first country to acknowledge the economic and societal importance of the social sector by creating ‘Third Sector’ comprising of voluntary and community groups, social enterprises, charities, co-operatives and mutuals that share the common characteristic of being non-governmental and value driven and principally reinvesting any financial surplus to further social, environmental or cultural objectives. In 2006 British government created the ‘office of the third sector’. The British government is spending millions of pounds in the third sector. Recently President Obama has also created ‘the office of social innovation and civic participation with a Social innovation fund’ (The White House 2009) which intends to identify and replicate the high-impact, result-oriented social organisations that address the nations most challenging social problems.

In our country in my observations The Aravind Eye Hospital is the classic example for social entrepreneurship defining all the aspects of it. Founded in 1976 by Dr. G. Venkataswamy with the mission to eliminate needless blindness, Aravind is the largest and most productive eye care facility in the world. Taking its compassionate services to the doorstep of rural India, Aravind’s stunningly effective strategies vaulted barriers of distance, poverty and ignorance to create a self-sustaining system.

Social and environmental problems can be solved if Social Entrepreneurship is considered as the important sector. Technical and Entrepreneurial skills must be utilized in this sector. The Young Entrepreneurs should think differently and be prepared to take some orbit shifting challenge, as the saying goes ‘The starting point of a breakthrough innovation isn’t an idea but an orbit shifting challenge.’