Interest in the area of social entrepreneurship has gained momentum in recent years. Many studies have been commissioned in this area, including comparative studies to provide clarity between the concept of conventional entrepreneurship with that of social entrepreneurship, and also social entrepreneurship with that of not-for-profits activities, such as Corporate Social Responsibility (CSR) initiatives, charity and voluntary works. In recognising the vital role of social entrepreneurship to the economy and the society at large, experts in the area of business and entrepreneurship have been supporting the views that social entrepreneurship is the force that will drive this world for a better future.
We may have seen a successful conventional entrepreneur establishing a business venture, accumulating wealth through profits, and thereafter, contribute a significant part of his or her wealth for charitable causes to benefit the society. Undoubtedly, such a deed is noble, and is highly recognised and appreciated by society. Nevertheless, one may question whether such contributions are adequate in providing long-term and sustainable solutions for serious socio-economic problems especially among the underprivileged segment in the society, such as providing them with adequate and decent education, health care, energy, and water services. In addition, there are also the need to address poverty, unemployment, housing, environment and other problems in the society. Inevitably, a viable long-term and permanent solution is essential to solve the socio-economic problems, and this leads to the emergence of social entrepreneurship as a viable alternative to the conventional entrepreneurship in recent years.
The concept of social entrepreneurship is different from conventional entrepreneurship, and its scope is much wider than that of Corporate Social Responsibility (CSR) initiatives, or charity and voluntary works. Comparatively, the difference between conventional entrepreneurship with social entrepreneurship is in their fundamental mission. In this regard, the fundamental social entrepreneurship mission is to generate “social value”, whereas conventional entrepreneurship fundamental mission is driven by profit. When compared with not-for-profit organisations such as charity or voluntary foundations, social entrepreneurship mission is much wider because it targeted not only towards immediate, small-scale effects but sustainable, long-term impact.
Perhaps the best words to encapsulate the role of social entrepreneurship are those of Bill Drayton, CEO and Founder of Ashoka, one of the world’s leading social entrepreneurship network: “Social entrepreneurs are not content just to give fish, or teach how to fish, they will not rest until they have revolutionised the fishing industry.”
Essentially, social entrepreneurship are business ventures initiated by social entrepreneurs. They are the people who establish their businesses where economic value and societal contribution can be realised at the same time. They are highly motivated in identifying opportunities to solve prevailing socio-economic problems that affect the society, such as education, health care, poverty, energy, water, and the environment, and they envisage the underprivileged as the solution, not merely passive beneficiaries or welfare recipients. In doing so, they do not wait for a massive profit before they can contribute to society.
The concept of social entrepreneurship can be aligned to Islamic values and principles of development. There are verses in the Quran which state that all resources in this world are meant for the benefit of mankind. Hence, men are enjoined to explore, utilise and mobilise them not only for individual needs but also to fulfil moral and social obligations. In the Islamic concept, developing important sectors in the economy, such as agriculture, industries, trade and commerce is actively supported. For example, land must be used and cultivated for the benefit of society, rather than leaving it forsaken. Furthermore, manufacturing and services sectors should also be developed to cater for human needs. Islam emphatically denounces poverty because it is detrimental to the human ability to perform individual, social and moral obligations. Furthermore, Muslims are reminded to seek Allah’s protection from poverty. As a form of motivation, those involved in entrepreneurship are accorded a prestigious status of being able to live with the Prophet in the hereafter.
What comes to mind in business ventures is the availability and cost of funding. For that matter, the Islamic-based finance concept offers many interest-free, risk-free and risk-sharing funding instruments that can be utilised and mobilised by social entrepreneurs. Such funds are available in the form of Zakat (compulsory alms), Waqaf (endowment fund), Sadaqah (voluntary charity), Hibah (gift), Qardhu Hassan (benevolent-interest free loan), and Takaful (mutual guarantee and solidarity), Mudaraba (profit sharing) and Musharaka (partnership) contracts. If these funds can be utilised efficiently and effectively we may see many social enterprises exist and contribute to the society and the economy.
Given the important role social entrepreneurs can play in the economy, it is therefore necessary to develop a conducive ecosystem for social entrepreneurship to thrive in this country. The essential parts of the ecosystem would require proper tools in nurturing social entrepreneurs with the right mindset and worldview, and also serving as a platform to cater for funding needs. Perhaps the existence of many social entrepreneurs in the economy will bring about improvement in the domestic supply-chain activities, and eventually, the benefits will be enjoyed by the society. Moving forward, social entrepreneurship may also be considered as one of the areas in the already comprehensive and vibrant Islamic finance ecosystem, and also could be one of the components in the financial inclusion initiative.
