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8 Trends That Will Impact Social Entrepreneurs in 2012

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2011 was full of good news for social entrepreneurs. And 2012 promises to be even more exciting. Here is what I think social innovators will build upon in the New Year!

Co-operatives Are Making it Easy All the Way

One of the positive things that 2011 stood for was collaboration. Co-operatives, sharing models cropped up in all business areas whether it was cars or workspace, people found that working together made all the difference. It was fun, profitable and lowered costs and environmental impact. Successful collaborative design and crowd funding projects have laid the foundation for cool ventures that think outside the box. Several successful social enterprises were founded on this ideology and everything points to the direction that the sharing model will bring in a new wave of business possibilities in 2012.

Ownership Rules

The Occupy Movement demonstrated that when too much wealth is in the hands of a very few, there is unrest and a very unhappy situation. Social entrepreneurs must work towards a business model that involves employees with a meaningful stake in the company. When employees and stakeholders have meaningful contributions, the dynamics change. Like Jeffery Hollender says, “Owners perform better than employees. Every employee should be an owner.”

Responsible Companies Are More Profitable 

We are not going to get into the “why is sustainability better for my business” mantra again. If you did not believe that, you probably would not be reading this blog. We have covered plenty of stories on companies like Planet People, Janum, Conscious Box and Method doing good and making good money! How about I give your some facts?

Academics have spent decades studying in great detail whether responsible companies are also more profitable companies, and three decades of evidence suggest that betterness yields greater equity returns, asset returns, and profitability. Researchers Marc Orlitzky, Frank L. Schmidt, and Sara L. Rynes found that responsibility was significantly positively correlated with financial performance: “corporate virtue,” in their words, “is likely to pay off. Responsibility fuels outperformance because it is risk management: better insurance against adverse future events.

So you made a profit. Yawn. Did you actually have an impact? This realization is motivating entrepreneurs who are taking on the challenge of doing good and doing well. Enough said.

The Difference Between “For-Profits” and “Non-Profits” Will Blur

As the managing editor of an eco-business blog, I have seen like never before the surge of innovative social entrepreneurs with “doing good” as the focal reason they started their business. I have seen non-profits incorporate successful for-profit business models and succeed. Social entrepreneurs always have occupied the exciting middle field between for-profits and non-profits and are pushing the boundaries on both ends, blurring the edges. Soon social enterprises will encompass the very definition of business and 2012 will be an important year to herald that.

Capitalism as We Know is Changing

Richard Branson says, traditional capitalism has failed and just cannot survive in its current model.

Since the Industrial Age, businesses have built their wealth off the use of natural resources. And unless businesses start to value and protect these resources, this cycle will have a devastating impact on the lives of our children and grandchildren. Many people are beginning to realize that business as usual is no longer an option. What is an option is to reinvent capitalism to truly be a force for good in the world.

This changing economic scene provides unprecedented opportunity for innovation and success in unconventional settings. The sky is the limit as new ways to do better business are taking root everyday.

Realization: The Earth is Not Isolated

2011 was a year of persuasive evidence that all living things are connected and that the fallout from our mistakes travels faster than ever. Whether it was the arab spring or the economic crisis, their effects were far-reaching,

Scripps estimates it takes only five days for Chinese pollution to hit California, and we all know how fast Germany’s monetary policy helps or hurts global stock markets. Radioactive material from Japan’s Fukushima disaster has shown up all over the globe, much as pollution from its predecessor in Chernobyl has done.  The economic troubles of Greece have impacted the global economy in some of the same ways that the U.S. meltdown impacted them.

The realization that the earth is not isolated quickens the pace on real development and social entrepreneurs are fueling this change. Just as negative impacts travel fast, positive changes are replicated all over the world.

Cleantech is Mobilizing Tech Gurus Into Social Entrepreneurship

“CleanWeb” is a category of clean technology that leverages the capability of the internet, social media, and mobile technologies to address resource constraints. At the Green:Net conference in April Sunil Paul, the Spring Ventures founder said,

“The next big wave will be in the “CleanWeb,” which marries information technology enhancements — such as Twitter, Facebook and the social web — with green initiatives. Information technology is actually going to prove as valuable as the application of new materials and nano-technology and bio-technology have been for the environment.”

Mobile computing has opened up this explosive world of mobile apps that has a huge potential to make an impact on the go. Apps are being created for everything from saving energy at home to finding a ride-share, infusing responsible behavior into our everyday. More importantly, its engaging the best minds in technology to foster social and environmental betterment.

The ‘Go Local’ Movement is Going Places

2011 has seen the “locavore” movement swell and gather more supporters than ever before. It started off with a call to eat local and healthy food but has spread to other business and consumption areas as well. This was due to a lot of reasons – a bad economy, the occupy ideology and the fact that patronizing “local”- helps your dollars stay in the community and keep it unique.

Michael Shuman, author of Going Local and the Small-Mart Revolution, has written:

Going local does not mean walling off the outside world. It means nurturing locally owned businesses which use local resources sustainably, employ local workers at decent wages and serve primarily local consumers. It means becoming more self-sufficient and less dependent on imports. Control moves from the boardrooms of distant corporations and back into the community where it belongs.

The local movement has opened up many ways SME’s can help foster local buying and involvement through programs like CSA management and environmental cleanup.

So that’s that. These are my picks on the exciting directions social enterprises might go 2012 and beyond. What are your thoughts? Did I miss any unusual business trends? Let me know through a comment!

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