Ambassador Gilmour Remarks
Social Enterprise Conference
May 11, 2018
Ecobank Conference Center
CEO of Ecobank
Heads of industry and business
Ladies and gentlemen
It has become almost a cliché to say that we are living in a time of unprecedented challenges. Climate change, rising economic inequality and mass migration are just a few of the problems putting an incredible burden on social systems already struggling to deliver services like healthcare, infrastructure, and education.
For the past 50 years, the task of tackling these big societal problems has been given to governments, while the private sector concerns itself with maximizing profits. Today, as challenges multiply and government resources are stretched thinner and thinner, I believe we must reevaluate this approach.
Imagine, instead, if the division between the public and private sectors was erased, and commercial strategies were applied to tackle complex problems and create social impacts. This, ladies and gentlemen, is the social enterprise model, and it is what we are gathered here today to discuss.
Contrary to popular belief, profitability and positive social impact are not mutually exclusive. It is, in fact, possible to build a successful company and do good.
Most nonprofits do good while losing money. They care only about impact. Many corporations make money without actually doing much good, at least for society as a whole. Each cares about one bottom line: impact or profits. In contrast, a social enterprise sets goals for its impact priorities in the same way it does for sales and marketing. It tracks both bottom lines.
Thus, the social mission is part of the business model of a social enterprise. Doing good is the core of the business, not just something that happens along the way.
I believe the social enterprise model is the model of the future, a model that has incredible potential to bring development and prosperity to Togo and the rest of the world.
There are two main reasons for this belief. First, social enterprises are more sustainable than nonprofit organizations or charities that must rely on grant money, donations, or government assistance. Because they are businesses first and foremost, they fund themselves. Mohammad Yunus, the Nobel Prize winner who created the micro-credit industry and pioneered the concept of the social business, once said, “A charity dollar has one life; a social business dollar has endless lives!”
Secondly, social enterprises can scale-up in ways other organizations cannot. The incentives of the company are designed such that greater impact directly correlates to a great profit. Just look at the example of Alaffia here in Togo. Alaffia has grown enormously over the past 15 years, and it has done so not by abandoning its core social mission, but because it has remained true to that mission.
Finally, I would add that the social enterprise model is not yet another western invention being imposed on the people of Africa. In fact, the social enterprise philosophy is in some ways distinctly African. Archbishop Desmond Tutu, who has been nurturing African social entrepreneurs for over a decade through his organization, the African Leadership Institute, popularized the ethical framework called “Ubuntu,” a Bantu word that can be translated as “interconnectedness.” Tutu said:
“We think of ourselves far too frequently as just individuals, separated from one another, whereas in reality you are connected and what you do affects the whole world. When you do well, it spreads out; it is for the whole of humanity.”
We need a new framework of economics that recognizes Ubuntu and empowers people to work together overcome the huge obstacles before us.
The first piece of this new framework must be to accommodate social enterprises as an integral part of the economic structure. And because we have so many policy-makers and decision-makers in the room with us this morning, I will seize this opportunity to offer a few simple recommendations about what Togo could do to facilitate the growth of social enterprises.
First, open up public data. By opening up data, and making it sharable and reusable, governments can enable informed debate, better decision making, and the development of innovative new services. Many social enterprises depend on open data to identify their markets and to measure results. With public data, we can assess how well social enterprises perform in comparison to solutions provided by charities or government aid programs, and we can start to understand where they can work together to create synergies.
Second, provide legal recognition to social enterprises. Many different legal structures exist for social enterprises, and it can be difficult to choose the right structure when starting a new social business. The best legal vehicle for a social enterprise is one that combines the tax and capital-raising advantages of both the for-profit and nonprofit worlds. In the UK, there is something called a community interest company. In the US, we have a new kind of corporate entity called a benefit corporation. Here in Togo, we should look at the legal framework that exists and consider revising it if necessary to make it easier to start, operate, and scale up a social enterprise.
Third, maximize resources through matching. The government and the private sector should be thinking about how they can support social enterprises. When a social enterprise is doing well, additional investment, whether from the philanthropic world, the private sector, or the government, can help it to grow, reach more people, and create an even bigger impact.
I believe that following these steps will show Togo to be a leader in the region and even in the world in recognizing and nourishing the tremendous potential of social enterprises.
Thank you for your attention. Thank you to all our wonderful panelists and moderators today. Thank you to the whole team at Ecobank and especially Mr. Ayeyemi for supporting this event. I wish you all a very productive and fruitful conference.