5 Business Benefits to being a 'Social Enterprise'

Clare Anderson
29th September 2020

Sharesource is a social enterprise - however what does this actually mean? And even more so, how does it benefit  business and why does any of this matter? Let’s start with Wikipedia’s definition:- a social enterprise is an organization that applies commercial strategies to maximize improvements in financial, social and environmental well-being. What differentiates social enterprises from other companies is that they have both business goals and social goals. Their main purpose is to promote, encourage, and make social change - in a financially sustainable way. 

Contrary to popular belief, there does not have to be a trade-off between making a social impact and bottom-line profits and investment returns. Companies with short and long-term success in mind are transforming the way they do business to embed purpose at their core. They’re building bottom-line benefits whilst still making a positive impact on society. Purpose should not be about a quick marketing tactic or campaign, or a moment-in-time effort - it should be deeply embedded into brand identity and the experience companies deliver. 

Here’s a quick look at Five Key Business Advantages to being a social enterprise:-

  1.  BETTER CUSTOMER RELATIONSHIPS
    Customers are increasingly holding businesses accountable for the impact of their core operations. Nearly two-thirds of Americans believe that companies should take the lead in driving social and environmental change. Social enterprises don’t just ‘greenwash’ their motivators as part of some obligatory Corporate Social Responsibility programme. They provide a compelling USP that provides a competitive advantage. This builds brand loyalty and, potentially, brand advocacy. Purpose creates client relationships that go far deeper than transactional or product-based relationships. And when companies maximize this, they position themselves to expand their customer base.
  2. GREATER EMPLOYEE MOTIVATION & RETENTION
    The millennial generation now makes up a majority of the workforce (56%, according to Pew Research Center) and a significant portion (30% of retail sales) of the purchasing force. 2020 signifies a time of change, and it’s important now more than ever to understand what drives and motivates this diverse segment of the population. Businesses are at a pivotal moment where the growing influence and purchasing power of this generation can no longer be ignored. The core of their motivations are simple: they want businesses to be kind. The Gallup How Millennials Want to Work and Live report published in 2019 found a few key overarching takeaways that can be beneficial for business owners and managers to understand about the millennial (and zoomer) workforce. One of the biggest? They don’t want just a paycheque, they want a purpose: employees want to know what difference they are making to the world and how their career matters in the larger picture. One in three agrees with the statement, “The mission or purpose of my organization makes me feel my job is important." Provide this and you will be able to attract the best staff and keep your existing staff satisfaction, motivation, and retention high. All ultimately hitting your bottom line as the costs and disruption of recruitment and training are reduced.
  3. INCREASED CREATIVITY
    Want your employees to start thinking outside of the box? Want to increase innovation in your company? Social enterprise initiatives encourage employees to try new things and get re-energized about their jobs. Through this social involvement, employees will feel empowered to start contributing to the bigger picture. They might come up with new ideas about products or internal processes or innovate new problem-solving solutions. When you demonstrate your company’s values and passions through a social enterprise ethos, employees will feel encouraged (and supported) to develop new and better ways to do their jobs.
  4. INCREASED PRODUCTIVITY
    It goes without saying that a more motivated and creative workforce will ultimately lead to great productivity - once again hitting your bottom line. As Inc.com reports, 30% of employees say they are more efficient when working for companies that have social ethics built into their values.
  5. ENHANCED BRAND AWARENESS & REPUTATION
    In today’s digital era, social enterprises are gaining exposure - and praise - for their social goals. Your brand’s reputation can only benefit from a socially conscious ethos. Think about it: customers feel good when they buy products and services from companies that are helping their community or the world at large. Global citizenship is now more of a hot topic than ever. Don’t miss the opportunity to publicize your social enterprise initiatives and spread the word about your community involvement. Tweet, post, and share your social programs. Letting the public know that you have a purpose beyond profits alone will only work to increase your brand’s public image.

Increasingly investors, business partners, customers, and employees want to know that the companies they choose are doing more than just providing a product or service. They look for companies that are doing good. They will feel a special connection to companies whose values align with their own. So, in summary, social enterprises positively affect both internal (employee engagement, productivity, creativity, and retention rate) and external (increased sales, customer loyalty, brand awareness) growth. What’s not to like?

 

If you’re looking to work with an offshore provider whose values align with yours, download our eBook, '30 Essential Questions to Ask a Provider Before You Outsource’. It will ensure you're informed and have the right questions to ask when considering the next step.

 

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