Profit as a Social Metric
This issue takes as its theme the question of a social profit and the various attempts, justified economically or otherwise, to organise entities to reflect this. As a focus, two articles are included in abridged form from a recent Royal Bank of Scotland/NewStatesman publication on ‘Social Enterprise: Creating a hub for innovation in society’.
“As Britain begins to recover from the financial crisis, charities and social enterprises are seeking ever-more innovative ways to fund projects and services which are of benefit to society. You only need look to the launch of Big Society Capital and social impact bonds – which are helping to reduce reoffending rates, improve our health and protect vulnerable children – to see just how much benefit this type of funding has to offer. Recent government estimates suggest there are 70,000 social enterprises in the UK, employing a million people. The sector’s contribution to the economy has been valued at over £24bn. Yet social enterprises claim access to finance is one of the biggest barriers to growth that they have.”
In Sign of Our Time, Sean Worth looks at public attitudes towards Social Enterprises and the Government’s attempts to facilitate their uptake. However, a background concept of ‘competition’ still appears to infuse these ideas, with business seen as a battle to capture specific new social markets rather than several individuals jointly striving towards the same goal without the exclusion of one’s fellow adventurers.
The first Feature turns the focus on the providers of investment who can help support this new entrepreneurial spirit. But again one wonders if this is still taken from the viewpoint of the status quo and how these enterprises can appeal to the current demand for market returns.
As a counterpoint, the second Feature takes a look at FairShares and how entities can be arranged as they evolve to help include additional stakeholders other than just the traditional shareholders.
Indeed, it seems strange to make the distinction between social and ‘normal’ enterprise, yet to maintain the standard, essentially market-based, critique of economics. From an associative point of view, in particular, the fact that economic life is driven by returns to capital is one of its major problems. Pandering to self-serving uses of capital from a ‘social’ perspective does not change anything.
By contrast, the Archive piece by Rudolf Steiner rehearses his main considerations as regards the true nature of profit when seen from an economic, rather than political, point of view. If only something of this kind had been in humanity’s mind in the early 19th century when ‘raw capitalism’ first caught the attention of Robert Owen, John Stuart Mill, Karl Marx and others.
Taking their cue from Steiner’s work, this month’s AE-Exchange pages look at the role of profit within the economy as a whole and also the role of individuals and their relation with this concept irrespective of, and perhaps despite, any additional external entities which may be created.
These pave the way for Victor’s View, which explores profit as a social metric in and of itself, without a need for a differentiation between social and anti-social. The role of individuals and the ability to share in each other’s profits are re-analysed as well as the notion of pre-distribution, the act of which may answer many of the questions raised, but not entirely answered, by the two previous Feature articles.
It remains to wish all our readers a Very Happy and Associative New Year!