Striving for an Economy that Generates Real Wealth
I am an insatiably curious person. Many things interest me and it is difficult to focus on just one thing. In fact, I’d like to think of myself as a “systems thinker” and so I’m always exploring all sorts of intriguing things to see how it all connects.
So, when thinking up my first blog for the Trico Charitable Foundation (TCF) I was at a loss for where to begin. How was I going to pick just one topic to focus on? I thought it might make sense to start with why I was drawn to working at TCF – and that is my growing awareness and interest in social enterprise (for TCF’s purposes, we define social enterprise as non-profit organizations running a business). I’ve also been learning a lot about private, charitable foundations. It’s a whole new world for someone who has only worked in the non-profit sector. Perhaps it would be valuable to share some of my new knowledge here?
Then I found myself watching Geoff Mulgan’s TED talk, Post-crash: Investing in a Better World, and I remembered some questions that have been on my mind for some time now. What is the economy for? What is the role of business in contributing to social good? This felt like as good a place to start as any.
I have to be honest. I didn’t used to give the economy much thought. Not until I started working in the field of community economic development and was introduced to all sorts of inspiring examples of how innovative approaches to locally-focused economic development could stimulate meaningful change for people. I saw that business, based on certain principles and used in certain ways, could contribute to healthy communities. I awoke to the realization that capitalism and economy, while related, are not the same thing and that both could be transformed to help us achieve the world we want. In fact, Ari Derfel of the Slow Money Alliance suggests that:
At its core, business is activism. It is the most powerful tool we have to shape the world. –Ari Derfel, TEDxPresidio
For me, the simplest way I’ve come to understand “economy” is that it is all the labour and capital required to facilitate the exchange of goods and services between people (Economics for Everyone was helpful here). Our current use of market capitalism is just one system that has evolved to allow this exchange. And while it has generated unprecedented wealth, it has also contributed to alarming inequality within our communities.
Fortunately, market capitalism is a human-made system. We made it, so we can un-make it. Or transform it. We can re-imagine it completely – and in my opinion, it is increasingly necessary that we do. What’s also promising is that there is a lot of work already underway as people experiment on the pioneering edge of what a transformed version of capitalism might look like.
Social enterprise is one of those experiments, and while it has been in existence for several decades it’s the growing consciousness that the economy can be used to meet human needs and generate real wealth that might just make this social enterprise’s time to shine. Personally, I hope this means a proliferation of social enterprises that fully encompass what “Business 3.0” can offer. That is, businesses that don’t only generate revenue for revenue’s sake, but rather ones that provide goods and services that make it possible for people and communities to meet their needs. And not just basic needs – but all of our human needs like meaning, belonging and participation in the institutions that influence our lives.
This is the time to experiment with new iterations of how goods and services are exchanged (the economy) and to demonstrate that when intentionally put up front in business models, social, environmental, cultural and financial value can be generated. Not just for the business owner and customer, but for the entire community.
So, how do we get there? How does this new business model become the norm? The way all change happens – with experimentation, actively changing the structures that get in the way of progress and with investment of all kinds of resources into promising approaches. This is where TCF and others come in by providing the financial and technical support to launch social enterprises, and why I’m putting my energy here.
I encourage you to watch Geoff Mulgan’s TED talk. It sheds more light on these ideas and reminded me of that burning question: What is the economy for?
There’s no single response, but what are you doing to contribute to our collective answer?
Wondering what your next steps are? Here are some ideas:
- Make purchasing from social enterprises part of your personal “purchasing policy”. Encourage your employer to do the same. Check out the Social Enterprise Marketplace here.
- Learn more about the social, environmental, cultural and financial value that locally owned businesses create. BALLE and Yes! Magazine are good places to start (both are American resources).
- Look up the root – the etymology – of the word economy and continue your own inquiry.