Social Entrepreneurs in the UAE: A New Business Class?

By Medilyn Manibo - Responsible Business – Dubai

 

Social entrepreneurship is seen by many advocates of the concept as a response to the failure of charity-driven corporate social responsibility (CSR) strategies to deliver the long-term impact of its investments. While this trend has been successful in many other regions, the Middle East remains at the bottom of the social investment map, considering that some of the top donor-giving nations reside in the region.

 In the UAE, a few organizations have started putting theory into practice. This article explores the emerging social enterprise class in the UAE. Is the current trend enough for investors and philanthropists alike to shift their attention into this growing movement?

 In 2011, the UAE has spent more than $2 billion in foreign grants and aid, an amount that spells a good amount in any investment book. From a traditional Islamic philanthropic perspective, it is giving and it is not meant to expect returns. If seen from this point of view, charity and philanthropy is unlikely to lose its relevance.

 This debate continues to be raised in discussion circles, ‘Is it the end of philanthropy?’ Despite that, there is clear evidence that the concept of social entrepreneurship is becoming more attractive given that the model gives clear social and economic returns. But the question then perhaps for companies that would need further clarification is whether this is going to be part of CSR funds or business investment.

 

Various Viewpoints

 In October, during a panel discussion presented by US-based Acumen Fund’s volunteer chapter in the UAE, Dubai + Acumen, Jane Novogratz, the founder and CEO of Acumen Fund, has not dismissed the irrelevance of philanthropy in the age of social entrepreneurship and sustainability. Instead, she commented that by pursuing a synergy between traditional philanthropic approaches and more modern social entrepreneurship tactics, it is possible for these enterprises to create viable, sustainable and profitable working models that governments and other organizations can build on.

 An example of the move away from grants-making model is the transformation of Emirates Foundation to venture philanthropy. While the shift is not social entrepreneurship, the concept has adopted the principles of venture capitalism, and very much espouses the same goals as impact investing or what any social entrepreneur would expect from its venture – that is social impact and economic returns. Clare Woodcraft, the new CEO of the foundation shares with Responsible Business the organization’s shift from multi-sectoral focus to only one area – that is of mobilizing the UAE’s youth towards a more productive engagement in society. (See full interview on page 48).

Another example is the Khalifa Fund for Enterprise Development launched in 2007. Although such initiative is not new and not necessarily purely social investment, its objectives still fall within the realm of eventually developing social entrepreneurs. One of its social outreach programs, the Sougha aims to address local heritage preservation through artisan development, product adaptation and opportunity creation through market access, harnessing craftsmen and women within the UAE’s lesser known regions.

“Social entrepreneurship is not something that is meant to replace charity. In emergency situations, you need people giving extra support, charity, donations, philanthropy to fix an emergency situation. In non-emergency situations, the power of the business can be more effective,” clarifies Medea Nocentini, founder and CEO of Consult and Coach for a Cause (C3), a social enterprise platform that provides business advisory and coaching to starting social entrepreneurs in the UAE.

 

Volunteers Arise for Social Enterprise

 C3 aims to assist and nurture young talents who have the potential to make their social businesses grow, currently operating as a free consultancy for social entrepreneurs. The venture took off in October 2011 through Nocentini’s volunteer consulting with a few social entrepreneurs. She naturally attracted like-minded individuals who wanted to do the same cause that she started.

 “It is amazing. Now we have reached up to 100 volunteers, they either participated one of these events or supported the entrepreneur on an ad hoc basis. We have about 80 entrepreneurs, not all of them are active. Some of them are social entrepreneur wannabes – they have an idea that they want to start very soon. Now, we have more than 20 social entrepreneurs who are quite established, either they have a licence or in the process of setting one up,” shares Nocentini.

However, Nocentini admits there are a few organizations in the field yet because there are very less social entrepreneurs. “I felt that we need to be there for social entrepreneurs to start up.”

C3 operates more like a matchmaker for social entrepreneurs to find their consultants. Entrepreneurs have a session of 20 minutes each with consultants during its speed consulting sessions.  By offering both business consulting and coaching, the organization sees the combination as an effective tool for social entrepreneurs to progress much faster. Consulting addresses the business tools needed by the entrepreneur while the coaching looks after the motivational requirements a social entrepreneur may face in the course of the journey.

 

Stable Market

Nocentini stressed the importance of a stable environment for a social entrepreneur to succeed, something which the UAE easily qualifies for, while its location in the Middle East is seen as an opportunity as well to serve the wider region and even South Asia.

“The best part of being based in the UAE is you have a lot of cultures, a lot of energy, a lot of young people, and don’t have the instability like Egypt or Syria. It’s a little bit more of a stable market. It is so important to have a stable environment and not after a year, it is disrupting your day by day business life. The fact that the UAE is a stable country makes a lot of big difference.”

C3 sees its role in three levels, the first of which is to nurture the movement of entrepreneurs who also wanted to do something good for the community. “When you are a social entrepreneur, you need a little bit more of support because you deal with social issues, it is a little bit more challenging,” she adds.

In the second stage, C3 is looking at helping angel networks select the ones that could be investment opportunities and prepare those entrepreneurs for investments. Its third role is to build a network of volunteer experts and become a platform for companies who want to look for experts in their social mission.

“For us, social enterprise is a business. It is a for-profit organization that is able to embed a social mission in the business model. Through business, the social enterprise is able to tackle a social issue. There are many different ways where a social mission could be included in a business model of a profit organization. It’s a little bit of for-profit and a CSR strategy – something in between. The idea is that any company can be a social enterprise in theory, if they find the right way that is sustainable,” says Nocentini.

 

SourceResponsible Business Magazine

 

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All, 2013

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