Social Business and big business: innovative, promising solutions to overcome poverty?

• Main Authors: Muhammad Yunus, Thierry Sibieude, Eric Lesueur
• Format: Article
• Language: English
• Published: Institut Veolia Environnement 2012-06-01
• Series: Field Actions Science Reports
• Online Access: http://journals.openedition.org/factsreports/1574

Do big businesses have to play a role on their own in poverty alleviation? And if so, what are the means of action they are able and eager to implement? For decades, eradicating poverty has been a challenge tackled by public interventions, international development organizations, NGOs. Since the question raised about corporate responsibility, there have been more and more integrated initiatives aiming at reducing social and environmental negative impact of a company. Some are convinced there may be solutions beyond these reactive approaches, relying on more proactive projects putting the social issues in the core business vision. Social business being one of those ambitious approaches, makes the company move from its business as usual and development innovation standards to “open” “embedded” innovation leading to local market creation while addressing poverty issues. Veolia Water, in collaboration with Muhammad Yunus Founder of the Grameen Bank, decided to experiment this kind of business model innovation in Bangladesh where there is urging health concerns linked to water arsenic contamination. The experimental process helped the joint-venture adapt to novelty and complexity (contextual, socio-cultural, commercial) and progressively give birth to a real market and test an innovative business model. This learning by doing approach teaches a big company such as Veolia Water how to make the trade-off between short-term profitability and positive contribution to society through a business integrating social concerns in its value proposition. It can also lead to rethinking of its usual practices and contribute to put on a more global sustainable business perspective.