Thursday, October 6, 2011

The role of public policy for social enterprise

In "Innovating the White House", she discussed the importance of government role to accelerate social entrepreneurship. I totally agree with the idea. Among all, I believe government controls and tries to accelerate social business by relaxing the regulations related to "finance" area such as tax deductible donation, social responsibility investment and new type of corporate (L3C, which allows to gather funding by issuing stocks). However, funding is only one aspect of the business. I think "education" is another very important factor which government can do something. The social entrepreneurs tend to lack some aspects of business perspective like finance, law, and globalization. So to support them, government can provide workshops / seminars for them, they can be the hub to share the best practice/know-how/tips/success stories, they can provide good data and provide tools to support their operation such as financial tools.Also, they can encourage people (universities?) to increase social business incubation centers, which can advice the early stage social ventures to plan their strategies effectively, and reduce the financial and legal risks. Supporting them means using tax, so government has accountability for their support. However, one of the problems government has is that they can't estimate return on investment effectively and consistently for social business. So developing a method to measure the success might also accelerate social business indirectly.

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