Social Entrepreneurship in the Middle East

Volume 1

Dima Jamali, Alessandro Lanteri, Dima Jamali, Alessandro Lanteri

• Publisher: Palgrave Macmillan
• Year: 2016
• ISBN:
  9781137395368
• Topic: Business
• Subtopic: Business Strategy
• Index: Business

This two-volume book unveils trends, strengths, weaknesses and overall dynamics and implications of social entrepreneurship in the Middle East region, whilst identifying both opportunities and threats facing social entrepreneurship and supplements through a wealth of insights and examples inspired from practice and current applications.

1

A Decade of Social Entrepreneurship in the Region

Iman Bibars

This chapter gives an overview of social entrepreneurship, both as a concept and as a practice in the Arab World. It has two main focuses: to interrogate and define the term “social entrepreneurship” and differentiate it from other, related, concepts; and to demonstrate why social entrepreneurship is an essential tool for solving social challenges, which has particular relevance for the Arab World in the light of the “Arab Spring” (or Arab Awakening).

I have been working with Ashoka: Innovators for the Public for 11 years, having established Ashoka Arab World, our regional office in Cairo, in 2003. My long experience with this organization, the platform for social innovation, has led me to the understanding that in order to be able to examine any of the issues listed above, we first need to agree on definitions.

Social entrepreneurship and what has come to be known as the Arab Spring are very loaded concepts that have been defined and understood differently by activists, social and business entrepreneurs, and academics alike. The different, and sometimes contradictory, definitions encountered have adversely affected the progress of social entrepreneurs working in the Arab World. It is important to have a clear understanding of the terminology used by different sectors – the social sector, the private sector, educational institutions, government bodies, and other stakeholders – if they are to collaborate in order to support social entrepreneurs and facilitate progress.

This chapter begins with an introduction of different definitions as understood by the leading social entrepreneurship institutions, explaining the history of the term “social entrepreneurship” through the story of Bill Drayton, the founder of Ashoka who originally coined the term, and reclaiming the true spirit of entrepreneurship that has been somewhat distorted by the business sector. Following that, the chapter explains why it is important and represents sound business and economic sense to invest in social entrepreneurs (male and female) whose work leads to significant long-term economic and social returns. Finally, the chapter argues that we need to change the social investment framework and create an enabling environment for social entrepreneurship in the Arab World in order to achieve these long-term returns that will benefit all sectors of society, business included.

Definitions and terminology

There are three leading global organizations that seek to promote and encourage social entrepreneurship: Ashoka, the Schwab Foundation for Social Entrepreneurship, and the Skoll Foundation. It is appropriate, therefore, to use the definitions of social entrepreneurship as given by these three organizations as a starting point for our examination of the concept and its practical application as a tool for addressing social issues.

Ashoka, founded by Bill Drayton in 1980, was the first platform for social entrepreneurs and today boasts the largest network of social entrepreneurs worldwide, supporting more than 3,000 Ashoka Fellows across the globe. In fact, it was Bill Drayton who coined the term “social entrepreneurship”. According to Ashoka:

Social entrepreneurs are individuals with innovative solutions to society’s most pressing social problems. They are ambitious and persistent, tackling major social issues and offering new ideas for wide-scale change. Rather than leaving societal needs to the government or business sectors, social entrepreneurs find what is not working and solve the problem by changing the system, spreading the solution, and persuading entire societies to move in different directions.

Social entrepreneurs often seem to be possessed by their ideas, committing their lives to changing the direction of their field. They are visionaries, but also realists, and are ultimately concerned with the practical implementation of their vision above all else. Social entrepreneurs present user-friendly, understandable, and ethical ideas that engage widespread support in order to maximize the number of citizens that will stand up, seize their idea, and implement it.¹

The Schwab Foundation for Social Entrepreneurship was founded in 1998 by Klaus and Hilde Schwab. The foundation is a non-profit and politically neutral organization that exists with the aim of advancing social entrepreneurship and supporting existing social entrepreneurs to transform society. They describe social entrepreneurs as the drivers of social innovation and transformation in various fields, seeking to

pursue poverty alleviation goals with entrepreneurial zeal, business methods and the courage to innovate and overcome traditional practices. A social entrepreneur, similar to a business entrepreneur, builds strong and sustainable organizations, which are either set up as not-for-profits or companies.²

The Skoll Foundation was founded in 1999 by Jeff Skoll, the first full-time employee of eBay, who later became the company’s first president. Skoll created the foundation with the vision of establishing a more sustainable and peaceful world. The best way to do this, he thought, was to invest in the innovative and creative people who were already positively transforming their own communities: social entrepreneurs.

The Skoll Foundation describes social entrepreneurs as “society’s change agents, creators of innovations that disrupt the status quo and transform our world for the better”.³ Furthermore, according to their understanding, social entrepreneurs possess similar personality traits; they are “ambitious, mission driven, strategic, resourceful, and results oriented”.⁴

To understand the original meaning of the term “social entrepreneurship”, as coined by Bill Drayton 30 years ago, it is important to understand what led to Bill’s decision to start Ashoka and the historical context in which this initiative took place.

In the late 1970s, the social sector was growing in size and scope, more than any other sector. However, innovation and creative thinking were not encouraged in the social sector; on the contrary, government donors dominated and controlled the scene and imposed their own solutions to basic, structural social problems for NGOs everywhere. They used a “one-size-fits-all” approach, attempting to employ the same solutions for poverty, women’s empowerment, and environmental challenges, and this was generally promoted and accepted. NGOs had to adapt their proposals and their needs to whichever priority or “fad” large, international, multinational and bilateral government donors wanted to address. Thus the policies, strategic development and approaches employed by the social sector were donor-centred rather than problem-centred or beneficiary-centred; they also often lacked cohesion or clear direction and were not based on the experience and priorities of experts working in the sector or of the beneficiaries themselves. The overall approach was nowhere near as effective as it needed to be, largely because it was tailored to the priorities of the donors, who did not have expert or in-depth knowledge of how to eradicate social problems.

Within this context, Bill Drayton saw a vastly different mindset in the business sector. Risk takers and innovative ideas were promoted, and people working in the sector were encouraged to expand markets and offered technical and financial support to scale and grow their initiatives. Bill Drayton identified the quality catalysing the growth of the business sector as “entrepreneurship”, which was celebrated in a business context. Innovation was not frowned upon. He, therefore, decided to create the first platform to seek out innovative and entrepreneurial souls in the social sector and to support them to enable the effective growth of their ideas and initiatives. He called these people social entrepreneurs: risk takers committed to solving the social challenges they have identified as a priority in their countries and communities through the implementation of system-changing solutions, which address and tackle the root causes of these challenges.

In Bill’s own words:

Whenever society is stuck or has an opportunity to seize a new opportunity, it needs an entrepreneur to see the opportunity and then to turn that vision into a realistic idea and then a reality and then, indeed, the new pattern all across society. We need such entrepreneurial leadership at least as much in education and human rights as we do in communications and hotels. This is the work of social entrepreneurs.⁵

Figure 1.1 Pie chart highlighting Egypt’s youth bulge

Note: Over 60 per cent of Egypt’s population are aged 30 or below.

Source: CAPMAS – The official statistics agency of Egypt.

Understanding the historical context in which terms such as “entrepreneur” and “social entrepreneur” and their original and historical meanings developed is very important, especially given the recent emphasis on promoting social entrepreneurship as a means of rebuilding Egypt and the whole Arab region in the aftermath of the Arab Awakening (aka Arab Spring) (Figure 1.1).

Bill Drayton and Ashoka’s definition of social entrepreneurship crucially includes the idea that its distinguishing characteristic, and its value, lies in using innovative approaches to create systemic change, tackling the root causes of problems to permanently solve them, regardless of the particular techniques and operational models implemented, business or otherwise. Ashoka and social entrepreneurs, therefore, have a long-term vision for sustainable change by eradicating problems in an effective way.

According to this vision, not only is financial profit not the primary objective of a social entrepreneur, but also social entrepreneurs do not necessarily seek financial sustainability. The sustainability of investing in a social entrepreneur comes from the long-term social and economic returns of the benefits their initiatives offer. Social entrepreneurship is, therefore, very different from social enterprise, inclusive business, and business with a heart. And these differences are vital and important when we examine the current situation and future prospects in Egypt and the whole Arab region.

Therefore, notions of affecting change and disrupting and transforming the status quo, for the benefit of certain sectors of society, are the defining aspects of social entrepreneurship. However, there is still an underlying implication within the business world and certain emerging branches of the social sector that financial sustainability, if not outright profit, is an important criterion for the initiative of a social entrepreneur. This assumption that social entrepreneurship means a business with a social cause or an inclusive business stems from how the term “entrepreneur” became associated with profit and business.

However, the term “business entrepreneur” does not describe someone who makes only money; it describes a person who innovates, thinks out of the box and expands his or her market. The word “entrepreneur” is derived from French and describes an adventurer, one who dares to take risks in pursuit of his or her goal and thinks and acts against the current. This is a person who sees an opportunity and seizes it and, in doing so, creates new value and wealth.

If entrepreneurs are successful in the business sector, they earn money. Their innovative and disruptive ideas shift economic resources from less productive areas to more productive areas and hence make a profit.⁶ Importantly, the profit is derived from the innovation and the opening up of new markets. Profit-making alone does not describe an entrepreneur.

The entrepreneurial character trait has become strongly associated with business ventures because the people who exhibited this quality were pioneers and achieved high levels of success. Ford, Microsoft, Apple, Google, Facebook, and Twitter are all examples of entrepreneurial endeavours in the sense that they carved a new industry and created a new market because the pioneers behind them saw an opportunity and seized it. The fact that they made money – and lots of it – resulted in the term “entrepreneur” becoming closely affiliated with the business sector.

For social entrepreneurs, profit-making and financial sustainability are secondary concerns. Their defining character traits lie in their innovative, system-changing, and sustainable solutions to society’s most pressing problems. Financial sustainability is achieved through the long-term social benefits accrued through the social entrepreneur’s work; a more cohesive society, less crime, more women involved in social and economic life, improved education, increased employment meaning more tax revenues, more people with disposable incomes to spend on products and services – this is the long-term sustainability of social entrepreneurs. These economic and social returns allow societies to prosper and produce thriving markets and economic growth. Of course, social entrepreneurs can make profit and use business methods in their strategies, but such criteria are not their defining aspects; sustainable solutions to social problems, achieved in the most effective manner regardless of the technique or model, define social entrepreneurship.

Having said this, Egypt and the entire Arab World do need all types of investment in addition to empowering every innovative person and encouraging every idea that could address the social and economic challenges that we are facing, which have increased in the past three years since the Arab Awakening.

One such challenge is youth unemployment, and Figure 1.2 demonstrates the scope of the problem in Egypt, particularly female youth unemployment. Moreover, of the total unemployed women, 41.2 per cent have a university degree. This is a huge waste of talent and potential.

Figure 1.2 Egyptian unemployment figures

Source: World Bank Data Bank.

In addition to youth unemployment, the Arab World experiences a myriad of social and economic problems. There are women’s rights issues, poverty issues, lack of quality education for all citizens, sectarian and ethnic strife, and many more challenges that are extensively res...

Table of contents

• Cover
• Title Page
• Copyright
• Contents
• List of Figures and Tables
• Foreword
• Acknowledgements
• About the Editors
• Notes on Contributors
• List of Abbreviations
• Introduction
• 1. A Decade of Social Entrepreneurship in the Region
• 2. The Context for Social Entrepreneurship in the Middle East
• 3. The Rise of Social Entrepreneurship in the Middle East: A Pathway for Inclusive Growth or an Alluring Mirage?
• 4. Social Enterprise in the MENA Region: False Hope or New Dawn?
• 5. Social Enterprises: A Panacea for Engaging Youth and Inspiring Hope?
• 6. Scaling Social Enterprises and Scaling Impact in the Middle East
• 7. Bridging Impact and Investment in MENA
• 8. From Necessity to Opportunity: The Case for Impact Investing in the Arab World
• 9. Arab Diasporas: A Catalyst for the Growth of Social Ventures in the Middle East?
• Index