Smart Thinking

Social Enterprise – Thought Leadership on Giving

Overview and analysis of seven thought leadership papers on Social Enterprise published by the Cabinet Office.

I HAVE DISCUSSED the content of the Green Paper on Giving, recently made available through Cabinet Office. The bundle was also comprised of seven supplementary thought leadership papers on Social Enterprise. What did they contain?

“No‐one is born a good citizen; no nation is born a democracy. Rather both are processes that continue to evolve over a lifetime.” Kofi Annan [from Hatton-Yeo’s paper “Giving and the baby boomer generation”]

1 – David Halpern

Influencers and Social Enterprise

David Halpern is a Senior Fellow at the Institute for Government, seconded to the Cabinet Office as Head of the Behavioural Insight Team. His paper “Giving, well‐being, and behavioural science” discusses the influence of declarative social norms. Giving, he argues is less influenced by match funding, and more by the example of others. Giving leads to increased sense of well being in the giver. He cites research by Elizabeth Dunn in support of his hypothesis.

Social Capital

2 – Geoffrey Miller

Social Enterprise and Evolutionary Psychology

Geoffrey MillerSocial Capital is an evolutionary psychologist and author of “The Mating Mind”, “Mating Intelligence” and “Must-Have: The Hidden Instincts Behind Everything We Buy.” His paper “Harnessing human nature for charity and volunteering: Some ideas from evolutionary psychology” argues that we must work with human psychology ‘as it is’. He considers empathy and moral emotion to be the foundation of altruism.

“Giving away resources through conspicuous charity, or time through conspicuous volunteering, is a costly, hard‐to‐fake signal that one has abundant resources, time, and empathy.”

The Mating Mind

I found his Darwinian preamble rather bleak and cold, however things heat up in his eloquent and engaging description of market economics. In terms of amplification of altruism in the establishment of a new social norm, we agree on the increased need for conspicuous giving. Magnanimity he argues is often aimed at increasing the status of the donor, however:

“better to gain status from magnanimity than from warfare”

3 – Harvey Koh

Harvey Koh is Head of Investment & Performance at Private Equity Foundation, a venture philanthropic fund focused on empowering young people to achieve their full potential. Previously, Koh worked at New Philanthropy Capital and The One Foundation.

The Business of Giving: The Theory and Practice of Philanthropy, Grantmaking and Social Investment (Cass Business Press)

Social Enterprise and New Philanthropy

His paper “Building powerful agents of change: a perspective from venture philanthropy” is in my view ‘the pick of the bunch’. It is no secret that I am an enthusiastic advocate of venture philanthropy, so much so that I would like to see dedicated line of business functions in ‘corporates’ aligning to this in their delivery of corporate social responsibility. Koh outlines the core principles of venture philanthropy (VP), and discusses nine lessons from experience gained at the Private Equity Foundation. I paraphrase (heavily):

  1. Symbiosis between venture philanthropy investor and investee charity must be tested through due diligence.
  2. Bold decisions and cold cash are required to effect real change.
  3. Input focus shifts to outcome focus, and measuring impact against “mission targets” rigorously is crucial.
  4. Expectations are running ahead of capabilities. Structures, and existing skills are not necessarily fit for purpose.
  5. Linked to point 4, an holistic approach is needed which builds the capabilities, scalability and skills of the charity itself. Rather than focusing solely on programme funding, this drives expansion and capacity. Not perhaps a revelation when considered in business terms, after all what business doesn’t invest in its core functions? But this is a trickier aspect for “not for profits.”
  6. The importance of interconnectedness – a point I question (in general) in the degree to which Big Society is an integrated policy.
  7. Untapped human capital. Leveraging professional ‘pro bono’ expertise has barely ‘scratched the surface’. Small contributions can make a difference, although I still see much potential for the Enterprise Encore Career. Cross reference this with Stephen Howard’s assertions that risk barriers must be removed to maximise engagement potential.
  8. Increase collaboration across sectors, stakeholders and investors. For me this is the innovation question.
  9. Philanthropy and Venture Philanthropy provide a means to an end. There is no reason for them not to coexist harmoniously and supplement other approaches.

Koh’s paper is a fascinating read, and a great entry point to understanding the potential of venture philanthropy / philanthrocapitalism.

Philanthrocapitalism: How Giving Can Save the World

4 – Nick Aldridge

Nick Aldridge is CEO of MissionFish (UK), which helps charities raise funds online. He is the author of Communities in Control: The New Third Sector Agenda for Public Service Reform.

MissionFish’s major initiative is eBay for Charity. His paper “The Big Society online: harnessing technology for social change” describes numerous technological innovations in streamlining and encouraging the giving process. Connectedness is at the heart of building a sustainable relationship between donor and recipient and Aldridge notes the benefits of localism and the power of social networks (as a platform for information dissemination, influence and engagement).

I was particularly interested to read his opinions on what government could do to help. A particularly notable idea is to enable universal “Gift Aid” – i.e. one declaration covers all subsequent donations to all charities. Why not go further and make “Gift Aid” an opt out? Micro-donations are very compelling, but these present additional problems in terms of the current Gift Aid processes. If we can link ‘weak identities’ perhaps mobile phone or email address to the micro-donation, apply the Gift Aid rebate across accumulated (perhaps annual) personal totals then redistribution of tax relief for micro-donations would be possible (also refer to Marcelle Speller’s paper and for alternative ideas).

An interesting fact relating to the position of charity brands within social networks:

“No nonprofits feature in the Top 20 brands on leading social networks, despite being amongst the most respected, loved and trusted by the public.”

This tells me that charities need to be engaged in Social Network Analysis (SNA), particularly in the hunt for key influencers. Targeting influencers in social networks is a smart marketing approach. It can also be used to manage churn risk, and help with retention of volunteers and donors.

I also like Aldridge’s thoughts on context. Context Aware Computing is on the rise, and we will increasingly see context leveraged in transactions and within the social network. Many organisations are looking at the potential of context, and charities should be no different.

Finally, a very interesting example of technology enabled micro-volunteering:

“ developed as a micro‐volunteering interface in response to the Haiti earthquake, encouraging volunteers with mobile phones to tag images of survivors, facilitating search and rescue by their families and aid workers.”

5 – Stephen Howard

Stephen Howard, CEO, Business in the Community (BITC) writes “Great companies support communities through difficult times.”

BITC is currently working to define the role of the “broker” in connecting the business world to the Big Society agenda. With 850 existing corporate members, BITC is well placed to respond to a challenge from David Cameron to create a further 1,000 brokers. The broker role will undoubtedly help ‘glue together’ the commercial and third sectors, provide scale and resilience and also operate as centres of excellence, best practices and enablers of innovation and knowledge sharing.

Age of Icons: Exploring Philanthrocapitalism in the Contemporary World

Howard goes on to cite areas in which government can make business engagement more significant: Removal of “risk barriers” –  enhanced CRB (Criminal Records Bureau) checks and professional insurance cover stifle engagement, by introducing prohibitive costs in terms of time and money. He considers:

“There is an opportunity for government to remove the disincentives to taking part‐time or casual work placements, which currently exist for recipients of Job Seekers Allowance.”

I do not disagree, but I think Work Programme and Universal Credit are important initiatives that will help break down this particular barrier.

Collaboration barriers are also mentioned and Howard notes that his members advocate changes to competition law to stimulate co-operation for social change. This is worthy of further research.

6 – Alan Hatton-Yeo

Alan Hatton‐Yeo, CEO of the Beth Johnson Foundation writes “Giving and the ‘baby boomer’ generation.” He revisits the 1993 European Year of Solidarity between Generations and asks the question:

“How we can unlock and value the unprecedented experience, resources and skills of our active older citizens to the benefit of all?”

He mentions two very interesting examples of staged retirement programmes, namely BT and Hanley Economic Building Society (based in Stoke on Trent) recognising the importance a staged approach to retirement can have in both meeting commitment to Corporate Social Responsibility and in creating an effective and healthy workforce. This is exactly what I am arguing for in the facilitation of the Enterprise Encore Career as an ‘employment choice’.

It is reassuring to read a rebuttal of “age automatically equates to dependency.”

The Social Entrepreneur’s Playbook, Expanded Edition: Pressure Test, Plan, Launch And Scale Your Social Enterprise

7 – Marcelle Speller

Marcelle Speller writes a paper “Giving in Local Communities.” She is co-founder of, founder of and a participant in Secret Millionaire (a UK television programme). Her paper reiterates themes of localism, and she writes with authority as a successful business woman and philanthropist.

Her brainchild was described by think tank Policy Exchange as “a unique and significant step forward in the use of the web for philanthropy” and her paper outlines its value proposition. The charity will be ‘national’ by spring 2011.

I agree with her view that it is more rewarding to be intimately involved in local delivery, than ‘write the cheque’ and leave it to someone else. Both models should of course co-exist. It is not possible (for most at least) to commit time to every charity and project they support.

Localgiving makes it simpler for smaller charities to leverage online payments and Gift Aid payments (even when they are too small to be registered with the Charity Commission). I refer back to Nick Aldridge’s point though that simple changes could be made to Gift Aid to make it more accessible.

Further Reading on Social Enterprise

By Steve Nimmons

Steve is a Certified European Engineer, Chartered Engineer, Chartered Fellow of the British Computer Society, Fellow of the Institution of Engineering and Technology, Royal Society of Arts, Linnean Society and Society of Antiquaries of Scotland. He is an Electric Circle Patron of the Royal Institution of Great Britain, a Liveryman and Freeman of London and serves on numerous industry panels. He is a member of Chatham House, the Royal United Services Institute and the Chartered Institute of Journalists.