What is a Social Business?
“This is not charity. This is business”
Business with a social objective, which is to help people get out of poverty – Prof. Muhammad Yunus.
It is like any other business in the world but built with a fundamental social purpose to serve humanity. Unlike the text book definition of business, which is to maximize profit, a social business is dedicated 100% to solve human problems.
Business which can solve human problems and also create wealth.
‘Social Business’ is a term coined by Nobel Peace Prize Laureate, Professor Muhammad Yunus. By his definition, a social business is a business with a “social vision at its core.” The primary focus of a social business is to address a social need and solve human problems. But a social business is not a charity – it generates profit and is financially self-sustaining over time.
“Tan Sri Jeffrey Cheah is one of the most inspiring entrepreneurs I’ve met. His Passion and belief in education as an instrument to lift people from the clutches of poverty is evident in the Jeffrey Cheah Foundation. The Jeffrey Cheah Foundation is indeed a unique set-up, which epitomizes social business at its best.” –Professor Muhammad Yunus
Written by Professor Muhammad Yunus below are the seven principles of Social Business:
1) Business objective will be to overcome poverty, or one or more problems (such as education, health, technology access, and environment) which threaten people and society; not profit maximization
2) Financial and economic sustainability
3) Investors get back their investment amount only. No dividend is given beyond investment money
4) When investment amount is paid back, company profit stays with the company for expansion and improvement
5) Environmentally conscious
6) Workforce gets market wage with better working conditions
7) “Do it with joy!”