There is no doubt that the current health crisis is changing the way in which we all work. Change can be invigorating, but it can also lead to unforeseen obstacles. This may be especially true for social enterprises.
Social enterprises in our network report an average loss of income of 70% while overhead costs such as rental space and salaries are due. Public funding is shrinking as governments redirect monetary support elsewhere. At the same time, many social enterprises are making direct contributions to address the crisis in various ways, from producing health equipment to developing digital work and online education, therefore demonstrating their resilience and adaptability. Yes, the situation poses challenges for our community but there are also opportunities.
It is those opportunities that I want to talk about today.
The Challenges We’re Facing
I cannot go into opportunities without first briefly mentioning what we’re up against:
- Cashflow issues
- Significant reduction of activities due to the restriction of movement
- Adjusting services and products to the status quo
- Addressing inclusive employment
And I would like to add an additional challenge: National governments tend to spend more money on cosmopolitan areas rather than rural areas. The risk of even greater regional inequality is looming in this crisis, where policymakers are forced to make quick decisions that often are based on short-term thinking.
Yes, social enterprises have been hit hard and this is especially worrying as they often work with the most vulnerable in our society. But, as I promised you in the introduction, this crisis also provides opportunities for our community.
As Winston Churchill famously said: never waste a good crisis
Crisis as an Accelerator for Social Change
Globally, social entrepreneurs are necessary catalysts for social change. Our industry is quick to see what is wrong in the world and become key players in bringing about paramount change. Economic downturns and other crises, therefore, become ways of empowering and enabling that change. This is where our advantages lay and advantages always present opportunities.
Opportunities Going Forward
In times of crisis, social enterprises tend to outperform their peers. You’re probably asking yourself, “how that’s possible?” I believe the answer to this question is threefold.
Social entrepreneurs are able to produce more profits because 1) They sell products and services that do real social good; 2) They are sustainably sourced, and 3) They are responsible and inclusive employers. These elements, which are the ethos for all social enterprises, create three advantages and therefore opportunities for social enterprises now.
- Advantage 1: Their products and services are based on innovation
According to a report by the Social Enterprise UK, 56% of social enterprises have introduced a new product or service in the previous 12 months, as compared to only 36% of mainstream SMEs.
- Advantage 2: Their businesses are resilient
Companies that most successfully weather storms are those that are authentic and have an integrated commitment to their larger purpose which is more important than profitability and growth.
- Advantage 3: Impact-driven employees
A value-driven team committed to the business’s impact can help mitigate risks by rallying around the cause, and outperforming all expectations.
There has been a lot of talk of how we’ll emerge from this crisis to a more sustainable future because the situation has shed light on how fragile our very survival as humans on this planet is.
Consumers’ demand for companies to address all stakeholder’s needs was already on the rise before COVID-19. But now people are increasingly making more conscious decisions regarding the things they buy and the companies behind them. They are looking at what businesses do through a crisis and they’ll support those that do the right thing. Social enterprises are the very embodiment of this.
Let’s emerge from this pandemic into a world in which people and the planet are valued above business. Remember: Never waste a good crisis. We are in this together and we are better together!
“Let’s emerge from this pandemic into a world in which people and the planet are valued above business.”
-Suzanne Wisse-Huiskes, CEO of Euclid Network
If you would like to find out more about how to get involved please contact the Euclid team for more information.