The world is facing major societal challenges – such as climate change, poverty and unemployment – that require critical action and innovative business models. Social entrepreneurs around the world are setting up businesses that promise to tackle these societal challenges.
Lisa Hehenberger, Director of the Esade Entrepreneurship Institute and Lecturer in the Department of Strategy and General Management, explains how these enterprises are changing the social landscape and bringing hope to change the world for the better.
Lisa Hehenberger: We are facing many societal challenges, such as poverty in developing and developed countries, unemployment, underemployment – people who don't have access to the level of employment they deserve based on their professional experience. We also have major global challenges such as climate change.
We need innovative business models to be able to tackle these societal challenges, and that's where social entrepreneurship comes in. Social enterprises are setting up businesses that are trying to tackle these societal challenges while operating in the market economy.
Benefits of social investing
Traditionally, investors think about having two pockets: one for investment and financial returns and another one for philanthropy and charity. But actually impact investing is combining these two pockets.
Impact investors try to have an impact on society while being able to have financial returns by investing in innovative social enterprises.
Social investing in Spain
In one of our research projects at the Esade Entrepreneurship Institute we conducted a mapping of the sector and convened different actors to analyse what their needs were. We have observed an increase in activity and new actors emerging in this space, which is a really positive sign.
We have also observed many new models being created, such as social enterprises adopting hybrid business solutions that combine a charitable approach with for-profit models.
Why research is important
The practitioners need research because they need to understand how they can develop frameworks and best practices, and academics can help them in this process. For instance, we have been working on impact measurements to help foundations find a way to measure social impact.
Research is also important for academics – social investing is a very interesting topic for researchers. We have several PhD students who use this approach as a research setting to develop theoretical contributions.
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