When the Philippine Social Enterprise Network was formed in 1999, social enterprises began establishing a footing in the country’s business landscape as organizations that have a unique blend of social and financial bottom lines. According to a 2015 report by the British Council Philippines, there were over 30,000 social enterprises in the country last 2007. Of this number, the vast majority were cooperatives and associations, while 500 were microfinance institutions.
Unlike mainstream businesses, social enterprises have their advocacies directly embedded into their objectives as companies. Although they aim to earn profit like normal businesses do, social enterprises reinvest these profits to their social causes in order to keep sustaining a target community or groups of people.
In DLSU alone, there have also been initiatives to promote social entrepreneurship through the Lasallian Social Enterprise for Economic Development (LSEED). The LSEED is one of the main components under DLSU’s Sustainable Development Goals Localization Project, which is led by the Center for Social Concern and Action. As of press time, the LSEED has initiated capacity building sessions and formation programs for students, employees, and community members from its partner communities in Leveriza, Manila.
Recently, student fellows of LSEED have completed several components of the program such as community immersions, learning sessions, and social enterprise development. The social enterprise development phase was attended also by select DLSU employees, who were trained to become social impact mentors to these student fellows. Their main objective is to provide pro-bono consultancy in creating community social enterprises.
The LSEED framework
LSEED Development Specialist Norby Salonga expresses that since there are no laws yet in the country that support social enterprises, they are currently following their own framework and definition of social enterprises using three elements: clear ownership structure, inclusive participation, and proper valuation on non-monetary contributions.
Moreover, he argues that this framework is unique because it treats beneficiaries, suppliers, and laborers as co-equals. “Of the nine models that the British Council was able to map out globally, ours is unique, because this is the first time that they heard about the model of social enterprises that are actually involving the community as co-owners and not just beneficiaries, laborers, or suppliers,” Salonga explains.
As for the main objective of LSEED, Salonga shares that it is to create ten community social enterprises by 2020, since it is a five-year project. There have already been several social enterprise ideas pitched in by the students, some of which involve food production and supply chain management. To enable the creation of these businesses, LSEED conducts several learning sessions and workshops for the students and community members.
“The reason why we have learning sessions [is] to start and invite people to have the foundation [to understand social entrepreneurship]. Little by little we’re expanding [the learning sessions] by tapping [into more] people to come in and attend,” Salonga states.
As of press time, the LSEED program has established partnerships with the College of Business, College of Liberal Arts, School of Economics, British Council Philippines, and foreign universities.
Of obstacles to success
On a national scale, the development of social enterprises is hindered by the lack of laws. In 2015, Senator Bam Aquino filed the Poverty Reduction through Social Entrepreneurship (PRESENT) Bill, which sought to formally define social enterprises and the scope of benefits these entities are entitled to. However, the bill has since been put on hold, following several legislators’ disagreements on certain proposed points.
The primary concern regarding the PRESENT Bill is that it may function as a duplicate law. One of the provisions in the bill requires the creation of a regulatory agency that will monitor all existing and upcoming social enterprises. However, some congressmen questioned the need for a new agency when others, such as the Cooperative Development Authority, already exist. Their argument is founded upon the notion that cooperatives are also considered as social enterprises in some models of social entrepreneurship abroad.
Salonga also cites the proposed tax exemption as a highly contested matter in the bill. Social enterprises fall under the umbrella of the Small and Medium Enterprise (SME) sector, which is already entitled to certain benefits that may be duplicated once the PRESENT Bill is passed. However, he argued that it is necessary to create a version of the bill that works for all parties concerned, since the continued delay in its passing also contributes to the inhibited growth of social enterprises.
“Looking at it right now, I would say [social enterprises] can’t grow with the kind of business environment that we have because they’re going to have to compete with a lot of organizations out there with huge capital, market base, [and] resources,” says Salonga.
LSEED in review
As a relatively young initiative, LSEED is still in the process of growing. Salonga hopes to see the number of student participants increase in the coming years. He also acknowledges that increasing and sustaining the number of participants would be difficult without the help of faculty mentors and professors, who interact with students more often than LSEED is capable of.
“If no one tries to advocate for the concept of social entrepreneurship in their respective classes then, we cannot expect people to come in. We cannot expect people to have a buy-in of the idea, because the very basic [element] is for them to have an appreciation,” Salonga emphasizes.
LSEED is also in need of more alumni mentors, particularly those involved in the field of business. Alumni mentors would be able to guide student participants through the process of establishing, running, and sustaining their social enterprises, having already experienced it themselves.
Lastly, the program is in need of a working space geared towards their needs. Ideation in social entrepreneurship requires innovative, out-of-the-box solutions that are not easily conceptualized in traditional workspaces. Moreover, while they are using various locations in campus as alternative facilities, LSEED is still in the process of securing the location that will function as their social enterprise incubation facility.
