Alliance Online - June 2008

Sitting quietly on the social justice bus?

Caroline Hartnell

EVENT 5th Skoll World Forum on Social Entrepreneurship
Dates 26-28 March
Venue Oxford, UK
Organizer Skoll Centre for Social Entrepreneurship
Theme Culture, Context and Social Change

The annual Skoll World Forum on Social Entrepreneurship, now in its fifth year, is above all a celebration of social entrepreneurship and social entrepreneurs. The annual Skoll Awards are unchallenged Oscars of the field. The recent Forum, held in Oxford, UK at the end of March, was also live testimony to the pulling power, sorry, convening power, of today’s philanthropists, with one ex-US President, one almost President and a clutch of Nobel Laureates heading a glittering array of speakers.

The potential benefits of this convening power are clear. Jeff Skoll’s film company Participant Productions funded production of Al Gore’s An Inconvenient Truth, which has played a huge role in bringing the issue of climate change onto the public agenda, to take just one example.

But there are others who feel the social entrepreneurship field over-emphasizes the importance of individuals. Paul Farmer, founder of Partners in Health and one of this year’s Skoll awardees, ended an inspiring address with the suggestion that social entrepreneurs should ‘get on the social justice bus and learn to sit quietly, only occasionally taking the driving seat’. Even Skoll Foundation President Sally Osberg, closing the Forum, quoted Jean Monnet’s saying that ‘Nothing changes without individuals; nothing lasts without institutions’.

Ongoing struggle for definitions

Whatever view one takes about the importance of social entrepreneurs in the scheme of things, it seems that the struggle for definitions continues. While honoured to receive a Skoll award, Paul Farmer confessed to feeling puzzled as to what made him a social entrepreneur. (‘This is something we all wonder,’ said the woman sitting next to me, also a Skoll awardee.)

But perhaps his puzzlement is more rhetorical than anything; at any rate it seems to be over. ‘I think I get it now,’ he said. ‘Those diagnosed do display certain classic symptoms: an unwillingness to accept the world as it is and to say this can't be done, persistence, hope, a sense of outrage at injustice to others.’

Jimmy Carter, also searching for definitions, suggested that social entrepreneurs are ‘people with faith – in themselves, in other people’. He went on to describe some he had known in his life, including one Donald Hopkins, a black American who became a specialist in preventive healthcare, who led the Carter Center’s efforts to eradicate guinea worm disease in Africa, which Carter vividly and movingly described.

‘Social entrepreneurs can fulfil a catalytic role and bridge different worlds,’ said UK Minister for the Third Sector Phil Hope, implicitly referring to the different ‘cultures’ of the sectors. ‘The power of the state needs to work with the restless energy of the market and the moral energy of individuals,’ he said.

Fit for purpose

There also seems to be widespread agreement among the social entrepreneurship community that these characteristics make social entrepreneurs peculiarly well fitted to deal with the problems the world faces.

Jeff Skoll eloquently laid out the challenge before us. ‘Social entrepreneurs have more prizes and more advocates than ever but we don't have more time. We're racing against the clock and the clock is winning.’ Hence the value of social entrepreneurs, the ‘people who don't understand expressions like “impossible” and “can't be done”’.

Al Gore appeared to agree both about the urgency and about the need for entrepreneurial solutions. ‘I wish I could find the words that would convey the urgency I feel would be appropriate,’ he said in an impassioned plea for people to come together to ‘save the habitability of the planet so that future generations will be able to enjoy a reasonable life’. Solving the climate crisis is not an abstract goal pursued at the expense of dealing with poverty and disease, he said, but ‘a way of unleashing energy to solve problems, through entrepreneurial solutions and public private partnerships’.

What about culture?

‘Culture is who we are and what we believe. Sometimes problems are about behaviour and habits and histories not about cash or incentives, and the solutions also lie in behavour and habits and art.’ So spoke Stephan Chambers, chair of the Skoll Centre for Social Entrepreneurship, introducing the official theme of the fifth Skoll World Forum.

The importance of culture was illustrated by speakers throughout the Forum. Karen Tse (International Bridges to Justice), for example, described her first efforts to engage with police officers in Cambodia: she came in and talked about the law and that didn’t work. ‘What police officers really wanted to know was how what I was doing connected with their values,’ she explained. ‘Beating prisoners was not consistent with the advances in society that were the reasons why they became police officers in the first place.’ Jody Williams, who won the Nobel Peace Prize for her work with the International Campaign to Ban Landmines, talked of similar challenges in ‘creating bridges to their humanity’ when dealing with diplomats and the military.

But in a way all this is obvious. As Stephan Chambers summed it up, ‘it’s the culture, stupid. It’s the language, the compassion, the connectedness.’ The real crowd-pullers were not the breakout sessions in the ‘Culture, Context and Social Change’ track but those on topics of perennial interest like measurement and finance in the aptly named ‘Evergreen’ track.

What’s the impact of this all – the three Ps of measurement

If there was one thing the panel discussing measurement and evaluation agreed on, it was that evaluation must be Positive: it must add value, and the value of knowing must be more than the cost of asking. All metrics must contribute to learning, and measurement and practice must be linked. ‘Evaluation is typically like an autopsy,’ said Brian Trelstad (Acumen Fund), ‘very expensive and too late.’

Another point that emerged strongly was that good measurement starts with good strategy and this starts with Precise framing of the problem. Fay Twersky (Gates Foundation) gave an example of wrong framing leading to measuring the wrong thing. The Gates Foundation set out to build 1,500 housing units for homeless families in a specific area. Evaluation showed that they had succeeded in this but the problem of family homelessness in the area had worsened. Their mistake: to frame the problem in terms of housing units built rather than addressing family homelessness.

Finally, the need for a Pluralist approach was emphasized: there are many constituencies and many measures. Some indicators are investor defined, others investee defined. How do you include those voices not usually heard? How good a listening device is the market? How many indicators do you need? Brian Trelstad admitted that Acumen tracks far too many things for each of its investments. Jeroo Billimoria (Aflatoon, Child Savings International) remembered creating 200 indicators and being asked, ‘Are you stupid or are you mad?’

Fay Twersky provided a needed reminder, in a world where performance measurement and constituency feedback are the new buzzwords, that measuring impact really is different from measuring processes or outputs. You are trying to find out what difference an intervention is making and what would be different without it. ‘It involves counterfactuals and attribution,’ she insisted, ‘and a different order of certainty.’

Growth finance for social entrepreneurs – where is the bottleneck?

The key message to emerge from this session was that supply of capital is not what Anthony Bugg-Levine (Rockefeller Foundation) called ‘the binding constraint’, nor is absorptive capacity. It's the lack of intermediation. This seems to be the key failing in what panelists agreed is still a largely dysfunctional emerging industry. The money is there but the industry infrastructure is missing.

Social entrepreneurs comprise the demand side but are very unsophisticated when approaching the supply side. They need more understanding of what needs subsidy as a public good and what has the potential to be invested in. They need to be comfortable with terms like mezzanine finance and growth capital.

Mark Campanale (London Bridge Capital) agreed that the challenge is to bridge the gap between ever-growing funds potentially available for social investment and demand from social enterprises. Some social enterprises are now quoted on stock markets such as AIM, Plus Markets and Sharemark. How can these be brought together for interested investors? A project to research the potential for establishing a social stock exchange in the UK was announced during the Forum. The hope is that this will provide at least part of the answer.

Another key piece of infrastructure that is missing is a clear definition of what a social enterprise is so that it will be possible to determine which organizations qualify to be offered on the social stock exchange. Another hallmark of a mature industry is a common language. The Brazilian and South African social stock exchanges are philanthropic clearing houses not stock exchanges in any accepted meaning of the term.

Without all of this, ‘deal flow’ will continue to be slow and piecemeal. One panelist described a recent meeting between a hedge fund investor and Slum Dwellers International. It started off with mutual distrust – SDI sees investors as cold and heartless; investors see social entrepreneurs as self-indulgent and woolly – and took a week. Yet the two sides need each other. When such deals become standard, they won't take all this time.

But people also warned of the danger of mission drift. Largely because of the lack of other ways to raise capital, The Body Shop was bought by l'Oreal, Green & Black by Cadbury Schweppes, Ben & Jerry’s by Unilever. Gordon Roddick was quoted as saying he wished they had never floated The Body Shop. More evidence, if it were needed, of the need for values-based investors for values-based businesses.

For more information
www.skollworldforum.com

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