Social Entrepreneurs and Conscious Capitalism

This blog post was prompted by a fellow Zaadzster, Andrew. I just received his email asking me this question:

".... Am trying to figure out where my angle and interests fits between the definitions of social entrepreneurs and conscious capitalism. Can you clarify the difference for me... if you can explain to me more about the distinction to CC and SE in your eyes that'd be great."

Good question. I wonder about that myself too. But first, before I answer the question let me say that I haven't (yet) engaged in social entrepreneurship. My understanding of it is purely intellectual at this time, while my experience with conscious capitalism is currently limited to Zaadz. (Though I learn a lot every day because of the people I get to network with by working at Zaadz :))

Having said that, here's my understanding of the difference between social entrepreneurs and conscious capitalism.

Wikipedia defines social entrepreneurs as "someone who recognizes a social problem and uses entrepreneurial principles to organize, create, and manage a venture to make social change." Ashoka describes social entrepreneurs as "individuals with innovative solutions to society's most pressing social problems." The keywords here are "social problems" and "solutions." In short, social entrepreneurs solve social problems (such as poverty, unemployment) to create a wide-scale social change without anticipation of substantial financial profit. In its attempt to define social entrepreneurship, the Stanford Social Innovation Review put it succinctly, "Social entrepreneurship signals the imperative to drive social change, and it is that potential payoff, with its lasting, transformational benefit to society, that sets the field and its practitioners apart."

Conscious capitalism on the other hand is "creating a new paradigm for business," to make corporations and businesses "conscious" about how they conduct their business. This includes infusing corporations and businesses with spirituality, corporate social responsibility (CSR), adoption of the triple bottom line (3BL) and other ethical business practices. In short, conscious capitalists (or business people engaging in conscious capitalism), put values first before profit. It's capitalism infused with "soul." However, conscious capitalists  are not necessarily recognized as entrepreneurs until they become "successful" with their business (see SSIR for details). And while conscious capitalists can also be social problem solvers, in general, conscious capitalists are exploiters of opportunity (or opportunity seekers) with a value proposition of gaining profit for themselves and/or for their investors, shareholders, and stakeholders.

Therefore, the main difference is: Social entrepreneurs are primarily (social) problem solvers without regard for profit. That's why many social enterprises are not-for-profit and have their grassroots planted in developing countries; While conscious capitalists are primarily opportunity seekers operating under the paradigm of conscious capitalism.

However, this doesn't mean that problem solving is an exclusive quality of social entrepreneurs while opportunity seeking is exclusive to conscious capitalists. Social entrepreneurs and conscious capitalists can (and ideally should) have both qualities. The difference is in their primary intention. Social entrepreneurs engage in entrepreneurial practices with the intention of solving "pression social problems" while conscious capitalists intend to grow businesses and generate wealth (e.g. within LOHAS market, high-tech industry, etc.) by also solving problems (e.g. distribution problems, service problems, etc.), but not necessarily social problems, by putting values ahead of profit.

By the above definitions we can say that social entrepreneurship is almost always a subset of conscious capitalism. Why? Because social entrepreneurs, to be successful, have to apply "entrepreneurial principles" in the domain of capitalism. Social enterprise can also be for-profit. Even not-for-profit social enterprise rely on big businesses (e.g. via foundation, philanthropy, etc.) to continue their operation. Conscious capitalists on the other hand have the option to switch their focus on solving "pressing social problems," or initiating social change, using their substantially generated profit (e.g. Google.org). Simply put, in the domain of capitalism, social entrepreneurs are a special breed of conscious capitalists.

Below is how I see the holarchical relationship of traditional capitalism, conscious capitalism, and social entrepreneurship.


There you have it. That's my take on the difference between social entrepreneurs and conscious capitalism based on my current understanding. I find it challenging to articulate this because social entrepreneurship is still undergoing a more rigorous definition (case in point: see Social Entrepreneurship: The Case for Definition).

So, what do you think? Did I get it right? Am I completely off? Did I miss anything? I want to learn more. I also want to hear from people who are into the theory and/or practice of Integral Business. So feel free to continue with the discussion by posting your thoughts in the comment section.

For more on Social Entrepreneurship see:

Social Entrepreneurship: The Case for Definition
http://www.ssireview.org/articles/entry/social_entrepreneurship_the_case_for_definition/

Ashoka Innovators for the Public
http://www.ashoka.org/

Echoing Green
http://www.echoinggreen.org/

The New Heroes
http://www.pbs.org/opb/thenewheroes/

Social Innovation Conversations (Podcast): Social Entrepreneurship
http://www.siconversations.org/series/socialEnterpreneurship.html

How to Change the World by David Bornstein
http://books.zaadz.com/1099/how_to_change_the_world/by_david_bornstein

For more on Conscious Capitalism see:

Megatrends 2010: The Rise of Conscious Capitalism
http://www.megatrends2010.com

John Mackey's Essay: Conscious Capitalism: Creating a New Paradigm for Business
http://www.wholefoods.com/blogs/jm/archives/2006/11/conscious_capit.html

The Triple Bottomline
http://www.thetriplebottomline.net/

UTNE: The New Capitalists
http://www.utne.com/issues/2006_135/promo/12081-2.html

Good Business: Leadership, Flow, and the Making of Meaning
http://books.zaadz.com/368/good_business/by_mihaly_csikszentmihalyi

Ken Wilber's Foreword to The Spirit of Conscious Business by Fred Kofman
http://wilber.shambhala.com/html/misc/foreword-spirit.cfm

Social Innovation Conversations (Podcast): Corporate Citizenship
http://www.siconversations.org/series/corporateCitizenship.html