nterprises through Affirmat

Mentor of the Webinar

Mr. Soumitro Chakraborty

CEO, fiinovation

About Fiinovation

A CSR based research consultancy working in areas of education,

livelihood, environment and health since last seven years

Assists businesses to support requirements of communities by

designing and implementation of sustainable projects

Through practices such as CSR-CSO Partnership, Initiative Design,

Initiative Management, Monitoring and Evaluation, Impact
Assessment, Sustainability Reporting; Fiinovation facilitates
corporations for promotion of social enterprises

Agenda of the Webinar

Better understanding on Social Enterprise models (Indian & Global)

Social Enterprise laws in India

Understanding of Affirmative Action in India

Promotion of Social Enterprise models among marginalised communities

India Inc and Social Enterprise movement

Top examples of Social Enterprise Models in India

Conclusion

Way forward

What is a Social Enterprise?

Asocial enterprise(SEs) is an organization that applies

commercial strategies to maximize improvements in human
and
environmental
well-being.
This
may
include
maximizingsocialimpact rather than profits for external
shareholders.

SEs have a mixed and contested heritage due to

philanthropic roots in the United States, and cooperative
roots in the United Kingdom, European Union and Asia.

Social Enterprise, the concept

Personal fulfillments

A SE could be engaged in any business

activity fulfilling any need (Maslows need
hierarchy)
Social
Nutrition, Needs

E.g.
Entertainment,
Sanitation,
Communication,
Livelihoods,
Transportation,
Education,
Training,
Financial
Inclusion

Basic
Asian Development Bank defines SEs as Needs

organizations that have triple bottom line

returns namely, addressing social and
environmental needs such as affordable
health services and energy, and have a
financially sustainable revenue model (or
plan to become sustainable in the near
future).

Maslows need
hierarchy

Social Enterprise Global Context

'Social Entrepreneurship' can be traced to Beechwood College

nearLeeds, England (from 1978) where Freer Spreckley used the
term 'social enterprise' to describe worker and community cooperatives that used the 'social accounting and audit' system
developed at Beechwood

Ashoka: Innovators for the Public a US foundation established

byBill Draytonwas a program to support the development ofsocial
entrepreneurship

In the US, the term is associated with 'doing charity by doing trade',
rather than 'doing charitywhiledoing trade'. In other countries,
there is a much stronger emphasis on community organising and
democratic control of capital and mutual principles, rather than
philanthropy

Social Entrepreneurship Development

Initiatives

Public Services(Social Value)Act,2012 (United Kingdom)

NYU Fellowships in Entrepreneurship, Social Entrepreneurship, and

Innovation

Social Enterprise Summer Fellowship, Harvard Business School

Amazing Grace, Rangoon, Myanmar

Global Social EntrepreneurshipNetwork, UK

Schwab Foundation for Social Entrepreneurship

Global Social Enterprise Initiative

Yunus Social Business

Rubicon Programs, California, USA

Social Enterprise India Context

Definition is not limited by legal structure. SEs may be registered as:

Private limited companies
Cooperatives
Not-for-profits, trusts or any other legal entities

In India, anon-profit can be registered as:

A Society, under the Registrar of Societies
or as aTrust, by making a Trust deed
or as a Section 8 Company under the Companies Act, 2013
Under Section 8 of the Companies Act, 2013, a limited company
(a) has in its objects the promotion of commerce, art, science, sports,
education, research, social welfare, religion, charity, protection of
environment or any such other object;
(b) intends to apply its profits, if any, or other income in promoting its
objects; and
(c) intends to prohibit the payment of any dividend to its members

Impact investing in India has roots extending back to 1982, when the Ashoka
Foundation provided grants to Indian social entrepreneurs.

Challenges Social
Enterprises
Social enterprises are not just scaling up, they are scaling out

Governments and international institutions have a huge role to play

The bigger the enterprise, the greater the need for democratic
accountability

Potential to transform the socio-economics of poorer nations, but individuals

require support such as capital, infrastructure, market access etc.

Entry of big businesses to the market

Social enterprise leaders do not often come from traditional business

backgrounds, hence lack expertise

Genuine need and desire for collaboration across sectors and geographies

Need of donor support

Progress on large social impact investments had been slow due to multiple
hurdles

Need for better infrastructures to support the sector

Few Social Enterprises

Global
Global
Samasource
Community Shop
Textbooks for Change
ArtZoco
eBatuta
Water Health
International
Kiva
Edgar and Joes
Bio Lite

India
Anand Milk Federation
Union Limited (Gujarat
Co-operative Milk
Marketing Federation
Ltd)
Godavari Women
Weavers Services
Producer Company
Nyayika, Leaps &
Bounds
Sukhibhava
Frontier Markets
m.Paani
Innovative Financial
Advisors
Samhita Social Ventures

Understanding Affirmative Action

Known as:
Employment Equity in Canada
Requires employers to engage in proactiveemployment
practices to increase the representation of four designated
groups: women, people with disabilities, Aboriginal peoples, and
visible minorities

Affirmative Action in USA

Focus on issues such as education and employment, specifically
granting special consideration to racial minorities and women
who have been historically excluded groups

Positive Action in UK
Promotion of people based on belonging to nonmajorityidentity
groups in the workplace, educational institutions and positions
in society

Contd

Affirmative Action in India

Known locally as reservation policy it is an elaborate quota
system for public jobs, places in publicly funded colleges and in
most elected assemblies

An action favouring those who tend to suffer from discrimination;

positive discrimination

AA reverses longstanding discriminatory tendencies in the society

For people of a certain caste, gender, sexual orientation,
race, or ethnic background

AA provides supposedly fairer conditions and corrects past

injustices

Different Approaches to AA
Affirmative
Action

Affirmative
action Through
CSR

Recruiting employees or
providing opportunities in
the recruitment process for
SC/ST communities

Implementing CSR
Activities as per
Schedule VII of The
Companies Act, 2013

Procuring from SC/ST

Vendors

Targeting SC/ST
communities

Offering solutions to
address the needs and
challenges of the SC/ST
communities

Poverty Among SCs and STs

As per the erstwhile Planning Commission, ST population

below poverty line came down from 47.4% in 2009-10 to
45.3% in 2011-12 in rural areas.

In urban areas, it declined from 30.4% in 2009-10 to 24.1%

in 2011-12.

Census 2011 revealed that the situation of non-workers

among total ST population (i.e. 42.0%) was not dismal as
compared to SC (i.e. 52.2%) and all other social groups
(53.3%).

Contd

Percentage of ST non- workers declined from 50.9% in 2001

(Census 2001) to 42% in 2011 (Census 2011) at all India level.

According to SECC, 133.5 mn households (74.5% of the total; 84%

for SC and 87% for ST households) have a monthly income where
the highest earning household member earns less than Rs 5,000,
whereas households with any one of the seven deprivations is only
86.9 million.

As per NSS, 34% of SCs and 46% of STs households were in selfemployment in 2004-05 in rural areas as compared to urban
proportions with 29% and 26% respectively.

Contd
There are 46, 844 villages
in the country having
greater than 50 per cent
SC population
The SECC covered 24.39
crore households across
the country 17.91 crore
are rural households
21.53 per cent of rural
households belong to the
Scheduled
Caste/Scheduled Tribes

Unemployment Rate (%)

Year

ST

SC

OBC

Others

Total

Rural Male

Maharashtra
government on the
issue
of
suicides
among cotton farmers
in the state suggests
that
suicide
incidences are slightly
higher among SCs
and STs across caste
groups
and
for
marginal and small
farmers across sizeclass of land.

2011-12

1.3

2.0

1.7

1.8

1.7

2009-10

1.7

1.7

1.4

2.0

1.6

2004-05

1.1

1.7

1.5

2.0

1.6

Rural Female
2011-12

1.1

1.4

1.7

2.4

1.7

2009-10

0.9

1.5

1.4

2.5

1.6

2004-05

0.4

1.4

1.9

2.9

1.8

Urban Male
2011-12

3.4

3.2

2.5

3.4

3.0

2009-10

4.4

3.1

2.8

2.7

2.8

2004-05

2.9

5.5

3.3

3.7

3.8

Urban Female
2011-12

4.8

4.5

4.7

6.3

5.2

2009-10

4.3

4.2

6.2

6.2

5.7

2004-05

3.4

4.6

6.7

8.5

6.9

Social Entrepreneurship & Affirmative

Action

Allocation of Rs 200 crore in the Budget Estimates 2014-15 for setting up

Venture Capital Fund for SCs

Earmarking of Plan Outlay under Tribal Sub-Plan at 24.71% under Indira

Awas Yojna & 20.59% for NRLM/ Aajeevika

Specific provisions made in the guidelines of programmes such as

MGNREGA, PMGSY and NSAP for the benefit ofSCs/STs

MUDRA Bank will be financing 6 crore small vendors and businesses, 61 per
cent of whom are SCs, STs, OBCs and minorities

India Development Marketplace, a World Bank initiative, to fund & support

social enterprises, announced grants worth $2 million to 20 social
entrepreneurs in Jharkhand, Madhya Pradesh and Chhattisgarh

India Inc and Social Enterprise

Tribal Farmers Producer Company Srikakulam, Andhra Pradesh (ALC &

NABARD)

NTFP (Gatherers' Self-Help Cooperative), Mayurbhanj, Odisha (ALC &

SPARDA)

Tata Social Enterprise Challenge (Tata Group, Acumen, Ankur Capital,

Yunus Social Business and Ennovent)

On 21st May, 2012, SEBI notified the word Social Venture Fund

Aavishkar, a venture capital firm, has been investing in social

ventures for over a decade, catalyzing innovation at the bottom of
the pyramid

CII & Social Enterprises

CII-ITC Centre of Excellence for Sustainable Development mentors,
advises, and
provides a platform to social entrepreneurs and enterprises
Mentorship and advice is on business models, strategies, and
partnerships
Annual event'Sustainable & Inclusive Solutions, a platform for social
entrepreneurs and
enterprises
Social Enterprises that CII have worked with are in energy access,
rural distribution and
agricultural services
Association with Selco Incubation Centrefor creating conditions to
deliver energy
services to low income families

Affirmative Action & India Inc.

As per MSME Report 2014-15,
7.83% of the enterprises were owned by Scheduled Caste
entrepreneurs
5.76% by Scheduled Tribe entrepreneurs
41.94% by entrepreneurs of Other Backward Classes
41.94

45

43.56

40
35
30
25
20
15

7.83

10

5.76
0.9

5
0

SC

ST

OBC

Others

Percentage Distribution of Enterprises by Social Group of Owner

Not Recorded

Contd
All India Confederation of SC/ST Organizationwas created in 1997 under
the flagship ofDr. Udit Raj, who is the National Chairman of
confederation that works for government reservations, ban on contract
system, promotion among other things
All India SC & ST Railway Employees Association
Tribal Cooperative Marketing Development Federation of India Limited
(TRIFED)
TheNarendra Modi government's 'Farm to Fork' programme over
2,000farmerorganisations
inChhattisgarh,
Jharkhand,Madhya
Pradesh,Andhra Pradeshand Telangana will be incubated to grow into a
cooperative society, trust and ultimately, a company, as part of the plan
being implemented bythe NationalBank for Agriculture and Rural
Development, the country's largest development lender.

Conclusion
Need to promote Social Enterprises through social venture funds
Establish platforms to highlight social innovators
Create larger market space by addressing social issues through
social businesses
Government should adopt policies to reduce red-tapism and
encourage individual
social entrepreneurs
Encouragement of co-operative movement as a social enterprise
model
Corporations can invest their CSR funds to establish social
enterprises addressing
social issues & also generating income for a particular community

Way forward

India Inc, Social Enterprises & Affirmative Action

Tripartite Model Social Enterprise,

Affirmative Action & CSR
Illustration
Corporation Xs
total CSR
expenditure:*

Rs 200 cr

Product:

Handicrafts / Food Processing

Registration :

The Companies Act, 2013

Organization
Structure
Operations:

Sourcing from community

members, processing of
finished products, marketing

Sharing of
Revenues:

Yearly dividends, remuneration

of community members,
salaries to staff, operational
expenditure, expansion costs

*Utilization of funds as initial capital for a Social Enterprise

Farmers/Artisans
Board
Managers
Members

Benefits of Tripartite Model

Provide an opportunity
independence for the SC/ST
communities

to

gain

financial

sustainability

&

CSR grant will allow corporations to spend money on social &

environmental issues,
and services not otherwise funded
Assets of SEs belong to the community and cannot be sold off for
private financial gain
People, who are local stakeholders in the area of benefit, play a
leading role in the
enterprise ensuring inclusive development
Local community are the shareholders who ensure accountability of
the enterprise to
the community

The Way Forward

Contributors to
the PPT
Soumitro Chakraborty
CEO, Fiinovation

Jaya Sinha
Dy. Director Media &
Communication,
Fiinovation

Rahul Choudhury
Dy. Manager, Fiinovation

Rohit Srivastava
Graphics Designer,
Fiinovation