The 7 Principles of Social Business are the principles that a business must follow to qualify as a social business.
The 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;
Financial and economic sustainability;
Investors get back their money amount only. No dividend is given beyond the investment;
When investment amount is paid back, company profit stays with the company for expansion and improvement;
Workforce gets market wage with better working conditions;
…do it with joy.
Are there many types of social businesses?
There are two types of social businesses: Type 1 and Type 2. A Type 1 is when the social business produces a product or service that is specifically targeting a social objective. For example, Grameen Danone is a Type 1 social business because it is a manufacturing a yogurt to fight childhood malnutrition. A Type 2 social business is when its shareholders are primarily under-privileged, and the profits are put into a trust to improve the quality of life for its shareholders by providing schools, health clinics, etc. Perhaps, the most famous example of a Type 2 social business is the Grameen Bank since nearly all of its shareholders are the under-privileged.
The vision and mission of the organizations that share his ideals are to eradicate poverty by 2030 and put poverty in museums as a relic from history, never to afflict society again.
What if you could harness the power of the free market to solve the problems of poverty, hunger, and inequality? To some, it sounds impossible. But Nobel Peace Prize winner Muhammad Yunus is doing exactly that. As founder of Grameen Bank, Yunus pioneered microcredit, the innovative banking program that provides poor people––mainly women––with small loans they use to launch businesses and lift their families out of poverty. In the past thirty years, microcredit has spread to every continent and benefited over 100 million families. But Yunus remained unsatisfied. Much more could be done, he believed, if the dynamics of capitalism could be applied to humanity’s greatest challenges.
Now, in Creating a World Without Poverty, Yunus goes beyond microcredit to pioneer the idea of social business––a completely new way to use the creative vibrancy of business to tackle social problems from poverty and pollution to inadequate health care and lack of education. This book describes how Yunus––in partnership with some of the world’s most visionary business leaders––has launched the world’s first purposely designed social businesses. From collaborating with Danone to produce affordable, nutritious yogurt for malnourished children in Bangladesh to building eyecare hospitals that will save thousands of poor people from blindness, Creating a World Without Poverty offers a glimpse of the amazing future Yunus forecasts for a planet transformed by thousands of social businesses. Yunus’s “Next Big Idea” offers a pioneering model for nothing less than a new, more humane form of capitalism. (More …)