Article by Kei Sato

Photo by krakenimages on Unsplash

Many people have argued that capitalism has widened the gap between the rich and the poor recently. It seems not to be suitable as a dominating system today as we have recognized the urgency to achieve equality. However, some corporations have significantly positive impacts on our society making the most of the system which is often called ‘social business’. This article will explore what role social business has and how it can contribute to solving urgent social issues.

Over the last 150 years, corporations have enlarged their dominance over the economy¹ and exploited resources on the planet and labour in some specific regions based on the principles of capitalism. They have caused tragic climate changes as well as some other social problems throughout the activities. As a result, people have begun to doubt capitalism as a way to develop our economy and improve the quality of life for everyone. At the same time, however, according to the win of Nobel Peace Prize by Muhammad Yunus in 2006 ², ‘social business’ has gathered more and more attention which has positive influences on our society. There is currently no single definition of social business, but it can be described as businesses conducted by companies with a primary objective of solving a social problem by applying business principles. ³

Social enterprises, which run social businesses, demonstrate a better way to do business, one that prioritises benefit to people and the planet and uses the majority of any profit to further their mission. For example, Grameen Euglena, a local joint venture company which aims to improve income and livelihoods in poverty-stricken rural areas, works on a ‘mung beans project’ to improve the food situation both in Bangladesh and Japan. ⁴ In Bangladesh, poverty in rural areas and farmers is an urgent social issue, and there is a huge necessity to create jobs and provide nutritious food like mung beans which are an essential ingredient in dal soup. On the other hand, Japan relies mostly on imports from China for the procurement of mung beans to grow bean sprouts and has suffered from significant price increases. This project, thus, has benefits for both countries; job creation, agricultural technology and expert knowledge, and more numerous mung beans for Bangladesh, and a new supply and stabilized price of the beans for Japan. Furthermore, what should be described here is that this project is actually ‘sustainable’. Their profit, in the first place, is used for the operation, which enables it to continue by itself differently from volunteer work. Not only that but a part of it is also used for the children in Bangladesh. The company distributes cookies containing ‘Euglena’ to them for free, six of which provide a day’s worth of nutrients. So far, it has delivered 16,474,304 servings of cookies to Bangladesh. ⁵ This sort of business has a goal to make a profit for the future contribution to social issues.

This sort of business could last almost permanently as it is profitable; in other words, it is based on capitalism. Volunteer work and green activities, for instance, are also great ways to have positive impacts on our society. However, those options are often not sustainable, especially for those who conduct them actually. Social business, on the contrary, is sustainable because it pursues profits thoroughly like the other businesses. In addition, consistent support enables people there to become independent by acquiring knowledge and constructing ecosystems, which leads to sustainable living for them. In this July, the author attended a lecture by the president of Grameen Euglena in Tokyo. In the speech, he said that ‘it is of course not easy to solve an issue fundamentally, especially a big issue like the one of Rohingya refugees, just by a company or a project. However, it could have much more significant impacts on it if a giant corporation gets interested in and cooperates with us.’ Thus, an approach to social problems with the tremendous power of corporations these days could be one of the most essential and effective ways to solve them.

In conclusion, although corporations and capitalism have been sometimes considered harmful in our society, they are actually capable of having positive impacts on social issues through ‘social business’. In the near future, corporations will become crucial actors in solving urgent social problems, instead of causing them.

Footnote:

¹ Bakan, J. (2004) Chapter 1: The Corporation’s Rise to Dominance. In The Corporation: The Pathological Pursuit of Profit and Power. New York: Free Press. (pp. 5)

²The Novel Prize (2023) Muhammad Yunus -Biographical. Available at: https://www.nobelprize.org/prizes/peace/2006/yunus/biographical/ (Accessed: 30 October 2023).

³ Boston Consulting Group (2013) The Power of Social Business Lessons from Corporate Engagements with Grameen. Available at: https://www.bcg.com/publications/2013/corporate-social-responsibility-poverty-hunger-power-social-business (Accessed: 30 October 2023).

⁴ Euglena (n.d.) Grameen Euglena. Available at: https://www.euglena.jp/en/businessrd/socialbusiness/grameen/ (Accessed: 30 October 2023).

⁵ Euglena (2023) Euglena GENKI program. Available at: https://www.euglena.jp/en/genki/ (Accessed: 30 October 2023).

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