Social Innovation in International Waters

Social enterprises are rapidly becoming major players in instigating social impacts and are changing how people think of philanthropic ventures. This new kind of business model is jockeying to be the kind of force that has eluded strictly charitable organizations in the past: “more than 200,000 nonprofits have been created in the US since 1970, but only 144 of them have reached over $50 million in annual revenue.” [1] Although not always easily classified as they carefully straddle the line between non-profit and for-profit, these ventures are developing faster than policies can keep up with them.

The innovation and complexity of some of these enterprises will require equally careful policies and funding platforms to ensure their sustainability, regulation, and perpetuation. Issues such as funding, taxes, and impact evaluation have found their way into the limelight in programs like the Office of Social Innovation and Civic Participation, the US government’s response to this new breed of enterprise. This office states its mission in three parts:  

• promoting service as a solution and a way to develop community leadership;
• increasing investment in innovative community solutions that demonstrate results;
•  and developing new models of partnership. [2]

Still in its infancy, one of the first initiatives from this office is developing measurement and evaluation metrics. The definition of ‘effective’ in the social enterprise context continues to be elusive and makes choosing the best programs to support a challenge. Would a more global perspective be more clarifying? Has there been any work to develop a definition that could cross oceans? Although I had a hunch that adding more opinions would have the fabled effect of more cooks in the kitchen, I decided to take a look. The Third Sector Research Centre, a collaborative effort between universities in the UK, asked this same question and found that “there was a lack of clear or agreed theoretical frameworks for researching international civil society, despite the increasing rhetoric on promoting trans-national third sector organising as a counter-balance to globalised economies.” [3] This was essentially what I was expecting.

Yes - These social enterprises are valuable and are increasingly discussed.

No – We don’t have a unified approach in supporting them.

Alas.

So my question is thus: because social enterprises will be likely to cross international borders to broaden their impact, should we be spending more effort innovating beyond the White House and get a running start on international policies? Or do we need to get a foothold on our approach to domestic policy first?  

[1] Investing in Social Entrepreneurship and Fostering Social Innovation (Jolin, Center for American Progress, December 2007)

[2] Office of Social Innovation and Civic Participation. http://www.whitehouse.gov/administration/eop/sicp

[3] Civil Society: International Perspectives (Angus McCabe, Third Sector Research Centre, August 2009)