01 Mar 2019
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Building a Movement

A quarter century of social enterprise at HBS
Re: Rebecca Henderson; George Serafeim

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image by John Ritter

Twenty-five years after the Social Enterprise Initiative (SEI) was launched at HBS, the Bulletin sits down with professors on the forward edge of the movement: Mitch Weiss (MBA 2004), who developed the EC course Public Entrepreneurship, and Julie Battilana, who holds a joint appointment with Harvard’s Kennedy School, where she founded the Social Innovation and Change Initiative. Here, they look back at the growing legacy of the SEI and the work still ahead.

What are some of the effects from the first 25 years of the initiative that are felt today?

JB: When SEI was founded, the notion of social enterprise was still relatively new to the lexicon, and HBS was clearly one of the pioneering actors in this broader movement to advance the study and the practice of social enterprise and in inspiring other academic institutions to create their own initiatives. Today, more than 90 faculty members at HBS have some connection to the initiative—doing research or teaching a course that relates to the themes of social enterprise, for example. Many of our students are deeply engaged—we have eight different student-led clubs related to social enterprise, and the level of interest among students has been increasing.

MW: Julie is right. SEI has had a tremendous amount of influence here, but also in the broader community. By establishing an effort around social enterprise at HBS, it helped to say, “Business should be for creating social value.” Sometimes we see business fall short, but it’s an important idea that resounds to this day.

One of the particular things that the founders did back in the 1990s that turned out to be very important was to put focus on social entrepreneurship—which is about adapting the skills and techniques of entrepreneurship for use in the nonprofit and social sector. Greg Dees, Kash Rangan, and others were instrumental in this effort, which told students that they could be entrepreneurs. It was validation that it was important and even urgent for them to do so. Nowadays it’s normal for a young person to think, “I might start a social enterprise one day. I might start an NGO. I might start a nonprofit. I might start a company that’s focused on increasing social welfare.” That’s not by accident—it is in part a function of the creativity and the work of the SEI founders, and it has led to the creation of wonderfully imaginative social enterprises here and around the world.

You both mentioned that student interest is one of the drivers. What else is driving the momentum behind social enterprise?

JB: Corporations face increasing pressures to dial down their single-minded pursuit of profit and to account for environmental, social, and financial performance. Those societal pressures are absolutely critical. Look at the level of inequality and the impacts of climate change—the system is not sustainable, it has to change. Maybe decades ago people thought of the world of business as separate from the world of social organizations—our students today do not care about this divide. So many of them come to HBS with a deep interest not only in making profit but also in doing good. So it’s multiple stakeholders putting pressure on businesses, and businesses themselves wanting to reinvent themselves.

And SEI has a really important role to play, supporting businesses and business leaders during this transition. When you’ve been trained to do one thing—to maximize profit—we cannot assume that it’s going to be easy to change the system and pursue multiple objectives.

MW: It’s also been a two-way street. On the one hand, there was a concern by people in business when they first got engaged in social enterprises—when they participated on boards, for instance, or gave money, or mentored people running these organizations. They looked at the capacity within these social enterprises and said, “Why don’t we take what we know about running high-functioning organizations and leadership and use it to help these groups that are doing really important work?”

And on the other hand, there was skill sharing back in the other direction. Social enterprise has helped bring things like corporate social responsibility (CSR) to businesses. Now we’re in this moment where people recognize that CSR isn’t enough. How do we help companies do more than just meet the bare minimum set of responsibilities, and actually go beyond that to deliver value to society as a whole?

As more students are seeking these tools, what is your vision for the future of leadership education?

MW: The School’s mission is to help educate leaders who make a difference in the world, and I think we can spread our social enterprise work more widely. I’d like us to find a way to reach people who aren’t able to come to Harvard Business School to learn these things. Of course technology affords us that ability these days, but it will require a bit more perspective shift too. Whenever we’re with students in the classroom—with MBAs or senior executives from around the world—their experience around these issues is revelatory. But it’s only 90 or 180 people at a time.

JB: I cannot agree more. I think it’s critical for us to think beyond the boundaries of Harvard. The question for us, for our students, for everyone who has the privilege of being here is how can we use our access to knowledge to help solve the problems we’re facing as a society. Business schools also have to think carefully about their curriculum. We’ve been talking about the need for corporations to adjust to a changing environment, increasing pressures to dial down the single-minded pursuit of profit and to integrate their financial, social, and environmental performance as core and central to what they do. We have to be thinking about how we’re going to support our students and business leaders to do that.

The EC course that Rebecca Henderson (MBA 1985) and George Serafeim have developed, Reimagining Capitalism, is a great example of that. They’re now also taking the lead in redesigning the RC course Leadership and Corporate Accountability—that’s a really important change. But my guess is that we’re going to have to look deeper, because we’re going to have to be able to talk across disciplines and across departments to think about the research and teaching we need to develop to better support business leaders of this new generation who aspire to have social impact. We really have to rise to the occasion if we want to make sure that we, as a species, continue to exist and protect our environment and protect each other.

There are also a lot of important research questions that we have to address. SEI has been one of the pioneers in the research field, trying to push for studies on how to scale impact. Social entrepreneurs all over the world are asking for that. We’ve made some progress, but we need to make more. What are the most effective vehicles to address certain kinds of problems? Because solving social problems most often requires cross-sector collaboration, we also need more research on how to effectively do so.

MW: Technology offers us the ability to solve problems we never could have imagined solving before. And I think that our students should be as well versed in those possibilities as anyone building consumer apps or SaaS for enterprise. It’s also an incredibly perilous moment for technology and the impact it’s having on society—whether it’s elections and free speech or harassment.

Over the course of a few years, people went from being very enthusiastic about tech to what was called tech-lash. And then we had tech-for-good: I wrote a case on Propel, which helps low-income people with financial services and food stamps. And now we’re in a moment of potential tech-for-good-lash, which is backlash against all these tech applications that we thought would be so good for society—making things work quicker and faster and cheaper and better for issues like homelessness, the environment, and health—because we need to settle questions around privacy and access and equity. It’s important that we have something to say about the opportunities for tech in helping solve social problems as well as identifying the ills from it and how we mitigate them.

JB: It strikes me as one of these questions for which we would want to have people from Harvard Business School and Harvard Kennedy School, as well as people from our engineering, law, and medical schools getting together. SEI, together with similar initiatives like the Social Innovation and Change Initiative at the Harvard Kennedy School, could play an important role in convening everyone to create public value. It’s time for us to walk the talk of cross-sector collaboration to help solve social problems.

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