Social Impact and Entrepreneurship: Creating a Common Language
The entrepreneurial landscape is changing. Whereas the social and the economic/entrepreneurial were once ideologically opposed, the focus is now shifted to the complementary of the two poles. By balancing the strength of both angles, an innovative and more sustainable entrepreneurship is created. Working with opposites is obviously not easy but we often forget what great results combining extremes can lead to: think about how two opposite poles are needed to generate electricity and produce light.
Social entrepreneurs embrace the poles of social purpose and entrepreneurial spirit. They understand that these provide the necessary nutrition and energy to keep the lamp (their mission) lit.
When these two poles -the economic/entrepreneurial and the social- start working together, they will need a language to measure, evaluate and communicate their contribution to the whole. That language may differ for the social and the economic, but it must be understandable for practitioners of both perspectives.
For a long time, the focus within entrepreneurship has been on the financial and economic aspects. As a result, many instruments have been developed to measure, display, control, evaluate, … important parameters. Think of accounting, annual accounts, financial ratios, and so on. Some of these instruments are even required by law. Moreover, the ‘bottom line’ is generally accepted as a good parameter to evaluate a company from the economic/financial perspective.
The evaluation of the social/societal/ecological aspect is still in its infancy. Over the years, the social balance and sustainability reporting has come into being, but these are still insufficient to grasp all the effects. New tools and methods like impact measurement, SDG reporting etc. are developed to fill this gap and support the reporting of these ‘entrepreneurial’ effects.