Social Entrepreneurship, The Nigerian Perspective 

 - Cletus Olebune

            courtesy of nel-mag.org

Running a socially responsible business can be good for the bottom line. I have always believed that businesses cannot exist in isolation with the community, hence my conviction that every business, whether non-profits or for profits must be socially conscious of its environment. This was my belief, when in 2002 I started Eastern Pharmaceuticals, focusing on accessibility of needed pharmaceutical drugs to poor communities in Africa. Red tapes in the global pharmaceutical industry squashed the growth, forcing me to sell majority of the company to a new majority owner, who now focuses on pharmaceutical raw materials (API), rather than in combination with finished generic drugs.

Lack of genuine social mindset in public and private endeavors is a major problem in most developing nations, including Nigeria, where fake drugs, foreign waste dumping, unethical business practices, and diversion of citizens monies meant for the societal and infrastructural developments is almost so common that society may have forgotten how not to do things. These are also encouraged by the lack luster attitude towards legislative regulations and their enforcements. If not, why would a company that manufactures a home cleaning liquid or body creams that could potentially poison or damage the end user be allowed to remain in operation. In most homes that use chemicals cleaning products, the air in those homes can be 70% or more toxic than the air inhaled on a busy Lagos street. It has been proven that within 26 seconds of exposure to chemicals from cleaning products, traces of these chemicals can be found in every organ of the body. Ingredients in standard cleaners include petrochemicals, which can be toxic to the air, humans and animals. Recently, in Abuja, “Otapiapia” the rat poison wiped out a family of five. The question is, was the fatal incident as a result of the carelessness of the end user, or as a result of inadequate warning label on the product and lack of education to the dangers of “Otapiapia” to the end users? Which ever is the case, the maker of “Otapiapia” should know the level harmful to human beings, and make the product accordingly; with proper marketing label.

Very troubling and interesting aspect of our cultural lack of social concerns in entrepreneurship also results in some self inflicting behaviors, particularly in the “living well” mindset, when the so called eating well of a rich person is clearly living in structural body obesity. The Nigeria cities population explosion, coupled with environmental degradation, and increased obesity; the healthcare problems that will result from non-contagious diseases, such as diabetes, cataracts, heart problems, and mental dysfunctions will make AIDS/HIV look like a child’s play if eating habits are not checked. More troubling is a society that has no developed management system to take care of its aging population. I recently met a fellow Nigerian at a United Nation organized function, as we talked, he told me he has a Non Governmental Organization that caters for the Aging. I thought how wonderful, but my joy of seeing one of our own running such social initiative was short lived when through questions on the operation of his organization I realized a focused self economic interest. 

In the developed worlds, citizens start or increase their business with a company that is dedicated to the social good. According to a survey by Golin/Harris International, researchers found that about 70% of Americans would start or increase their business with a company that is dedicated to the social good. There’s some value one can place on good will and the relationship with the community. A person is recognized as a leader in a society and not just in the corporate word. This is the essence of few of my writings arguing that the private sector must remain the source for employment and social developments. One may say, wait a minute, Jack Welsh, the world renowned CEO is famous for his management abilities at GE, but let us not be slumber, when the communities that GE operates is environmentally dissatisfied, GE took notice, and changed their environmental practices.

My Alma matter, Whitman School of Management’s Entrepreneurship program headed by Michael H. Morris, PhD was recently recognized as the number one business school in Entrepreneurship by the Entrepreneur Magazine. Morris, the author of Entrepreneurial Intensity and Corporate Entrepreneurship as well as several other business books is the Witting Chair in Entrepreneurship, created the Supporting Emerging Enterprise Program at University of Cape Town, in South Africa during his time as the Gordon Professor of Entrepreneurship. In one of his classes, and in his books, he maintains that the essence of entrepreneurship is the burning desire to create an organization that focuses in helping humanity by solving societal problems, providing needs, and in the process, the entrepreneur can make money. For developing countries, Morris sees a lot of entrepreneurial opportunities.

In the March 2006 newsletter, I had talked about the environmental sense of nuclear energy, and recently, I have gotten myself involved in an environmentally conscious start up – biohazard waste management; this is no coincidence, it is out of my conscious belief that the greatest opportunity for social entrepreneurs is investing in socially conscious ventures, such as solar energy technology, recycling, and the environmental public health. This conviction of social entrepreneurship was the backbone of my support for a Sierra Leonean friend, whom for years, I had bothered and encouraged her to do something on public health in her native country. As a successful healthcare professional in the USA, I knew she has what it takes. She finally did, and the rest is history. A non for profit organization that she started in which I am a board member is now known nationwide in Sierra Leone for helping to educate nursing mothers. Her organization is in the fore front of Infant Mortality concerns in Sierra Leone. To this end Nigerian Entrepreneurial Leadership recognizes Florence Dowie and her organization, SaLeone Health Pride as NEL Social Entrepreneur for the month of October 2006. 

For every entrepreneur or hopefuls, the key to success is to first think of the social benefits of your venture, even if yours in for profit, then go ahead to satisfy those needs, and the money will sure come. If the goal is money, one may sure make the money, but may lack in fulfillment. Entrepreneurs must have eyes that are more than profits to be fulfilled and retire happily. 

In thinking about Social Entrepreneurship in Nigeria, one statement comes to mind, “the number of people living for HIV/AIDS out numbers those living with the HIV disease”. In sharing my thoughts on Social Entrepreneurship – the Nigerian Perspective, I would like to reference to five social entrepreneurship terminology definitions.

After years of hovering around the edges of the nonprofit sector, social entrepreneurship today has moved into the mainstream. Venture philanthropists, traditional grant-makers, Boards of Directors, nonprofit entrepreneurs, consultants, academics and others are all rushing to the table. But there is still confusion about terminology.

"Dependency" 

The traditional business model for nonprofits, in which they depend solely or almost entirely on charitable contributions and public sector subsidies, with earned income either non-existent or minimal 

" Sustainability" 

The ability to fund the future of a nonprofit through a combination of earned income, charitable contributions and public sector subsidies 

" Self-sufficiency" 

The ability to fund the future of a nonprofit through earned income alone 

" Social entrepreneur" 

Any person, in any sector, who runs a social enterprise 

"Social enterprise" 

Any organization, in any sector, that uses earned income strategies to pursue a double or triple bottom line, either alone (as a social sector business) or as part of a mixed revenue stream that includes charitable contributions and public sector subsidies 

Social entrepreneurship is a key element to advance societies and address social problems in an innovative and effective manner. It didn’t innovative and greed, but innovative and effective manner (effective management for result oriented outcome that benefits society)

Social entrepreneurship is:

- about applying practical, innovative and sustainable approaches to benefit society in general, with an emphasis on those who are marginalized and poor. 

- a term that captures a unique approach to economic and social problems, an approach that cuts across sectors and disciplines. 

- grounded in certain values and processes that are common to each social entrepreneur, independent of whether his/ her area of focus has been education, health, welfare reform, human rights, workers' rights, environment, economic development, agriculture, etc., or whether the organizations they set up are non-profit or for-profit entities. 

It is this approach that sets the social entrepreneur apart from the rest of the crowd of well-meaning people and organizations who dedicate their lives to social improvement. 

A Social Entrepreneur is also:

A pragmatic visionary who achieves large scale, systemic and sustainable social change through a new invention, a different approach, a more rigorous application of known technologies or strategies, or a combination of these. 

Combines the characteristics represented by Bill Gates, Richard Branson and Mother Teresa. 

Social entrepreneurs share some common traits, including: 

- an unwavering belief in the innate capacity of all people to contribute meaningfully to economic and social development 

- a driving passion to make that happen. 

- a practical but innovative stance to a social problem, often using market principles and forces, coupled with dogged determination, that allows them to break away from constraints imposed by ideology or field of discipline, and pushes them to take risks that others wouldn't dare. 

- a zeal to measure and monitor their impact. Entrepreneurs have high standards, particularly in relation to their own organization’s efforts and in response to the communities with which they engage. Data, both quantitative and qualitative, are their key tools, guiding continuous feedback and improvement. 

- a healthy impatience. Social entrepreneurs don’t do well in bureaucracies. They cannot sit back and wait for change to happen – they are the change drivers. 

Social entrepreneurship is the process of recognizing and resourcefully pursuing opportunities to create social value. Social entrepreneurs are innovative, resourceful, and results oriented. They draw upon the best thinking in both the business and nonprofit worlds to develop strategies that maximize their social impact. These entrepreneurial leaders operate in all kinds of organizations: large and small; new and old; religious and secular; nonprofit, for-profit, and hybrid. These organizations comprise the "social sector." 

What business entrepreneurs are to the economy, social entrepreneurs are to social change. They are the driven, creative individuals who question the status quo, exploit new opportunities, refuse to give up, and remake the world for the better." – David Borstein, Author of How to Change the World: Social Entrepreneurs and the Power of New Ideas.

Now, how socially entrepreneurial innovative are political position seekers’ or office holders’ give away goodies for self accolades? My goal is always to raise awareness. Now you tell me, how socially innovative can you be with the things I asked you to look after for us all? Are we as Nigerians double minded in social entrepreneurship? Let us look at few examples of where one may think that social entrepreneurship in Nigeria may not be what a typical social entrepreneurship ought to be, and how greed may have robbed the true meaning of social entrepreneurship endeavors initiated in Nigeria. As I write this article, I harbor no bias against any organization but if it seems that your organization — you as an individual person or structured entity sees yourself in this article, then you need to rethink on who you do things.

“The number of people living for HIV/AIDS out numbers those living with the HIV/AIDS disease.”

Despite efforts to spread an innovation-based definition as stated above, far too many Nigerians still think of social entrepreneurship in terms of nonprofits generating earned income. This is a dangerously narrow view. It shifts attention away from the ultimate goal of any self-respecting social entrepreneur, namely social impact, and focuses it on one particular method of generating resources. Earned income is only a means to a social end, and it is not always the best means. It can even be detrimental-taking valuable talent and energy away from activities more central to delivering on the organization's social mission.

Focusing on earned income leads people to embrace the problematic idea of a "double bottom line" (double mindedness). Profits should not be treated with equal importance to social results. No amount of profit makes up for failure on the social impact side of the equation. Any social entrepreneur who generates profits, but then fails to convert them into meaningful social impact in a cost effective way has wasted valuable resources. From a management point of view, the financial "bottom line" is certainly important, but it is not on the same level as social impact. Social entrepreneurs have only one ultimate bottom line by which to measure their success. It is their intended social impact, whether that is housing for the homeless, a cleaner environment, improved access to health care, more effective education, reduced poverty, protection of abused children, deeper appreciation of the arts, or some other social improvement. Do we wonder why there are so many abandoned infrastructural projects in Nigeria that would have moved the country in the right direction. Well, don’t wonder any longer, the answer is because, these projects were not initiated with a social conscience that solve people’s problems but as a means of earned income. 

Many activities that generate earned income are not entrepreneurial at all; 10 % here, 10% in unethical business practices may generate earned income, but is not innovative or entrepreneurial it only make monetary riches for a few while majority suffers. Earned income has become commonplace. In fact, if religious congregations are excluded, earned income has exceeded donations as a source of funds for public charities in developed nations for many years now. Hospitals charge fees for medical services; private schools charge tuition; performing arts groups sell tickets; many museums charge admission and often have gift shops in their lobbies. No one thinks of these practices as examples of "social entrepreneurship" even though they all involve generating earned income. It would be absurd to give a social entrepreneurship award, for instance, to a major hospital simply because of its extremely high percentage of earned income from patient fees and the record profits at its gift shop and parking garage. Yet, this would be a logical implication of taking earned income as the yardstick of social entrepreneurship. High levels of earned income are often not innovative and may not be correlated with high levels of social impact.

Any form of social entrepreneurship that is worth promoting broadly must be about establishing new and better ways to improve a society. Social entrepreneurs implement innovative programs, organizational structures, or resource strategies that increase their chances of achieving deep, broad, lasting, and cost-effective social impact. To borrow from J.B. Say, the eighteenth century French economist who first popularized the term "entrepreneur," they shift resources into areas of higher productivity and yield. Habitat persuades volunteers to shift their time from recreational activities to building a house. Teach for America persuades bright college graduates who did not major in education to devote two years of their careers to teaching in schools that have a difficult time finding teachers. In Nigeria, the National Youth Service Corps may have started out of the need for young university graduates to familiarize themselves with the Nigerian cultural diversity, but lack of innovative ideas has stalled the growth of this wonderful social concept, that years back there was accusation of monetary embezzlements at the leadership. The yearly number of talented young Nigerians in the NYSC program is a source for resource-shifting talent pool. This resource-shifting function is essential to progress. As Peter Drucker has said, "What we need is an entrepreneurial society in which innovation and entrepreneurship are normal, steady, and continuous."

Of course, some exciting forms of social entrepreneurship use earned income strategies to achieve social impact. We should encourage social sector leaders to explore innovative financial strategies that make their organizations more effective in serving social needs while leveraging social assets. Creative efforts to harness business methods to serve social objectives are often entrepreneurial in the best sense of that term. Consider Grameen Bank that was built around an innovative approach of using peer-groups to improve the economics and effectiveness of micro-enterprise lending as a tool to fight poverty in Bangladesh. Or consider Delancey Street Foundation, a residential community of hardcore substance abusers in San Francisco that runs several businesses to provide productive employment to community members and generate funds for the organization. These are powerful examples of how social sector leaders can blend business methods with social objectives. What makes them entrepreneurial is not the source of income, but their innovations and their impact.

Earned income ventures are socially entrepreneurial only when they have a social purpose beyond simply making money. If social entrepreneurship is to be distinctive in any way, it must be because social objectives matter in how the venture is organized and managed. If the only way a venture serves your mission is by generating funds, it may be business entrepreneurship, but it is not social entrepreneurship. If one starts a bakery to make money that will be used to support a sailing hobby, we do not call the bakery a "sailing venture." Likewise using the proceeds of the bakery for a social purpose does not make it into a "social" venture. It is a social venture only if social considerations are integrated into its objectives and management. A purely moneymaking venture can be managed using straight business principles. It makes no difference if the owner intends to use the cash generated by the venture to buy a bigger sailboat or to serve the homeless. A true social ventures often require a more complex skill set than straight business ventures.

Only if we can embrace a definition of social entrepreneurship that focuses on innovation and impact, we can put funding strategies in their proper perspective. It is not surprising that people are drawn to the earned income definition of social entrepreneurship. Resources are scarce and social needs are great. Everyone wants to explore new avenues for generating resources and earned income seems promising. Unfortunately, some social sector leaders appear to be more concerned about attracting resources and sustaining their organizations than they are about assessing, sustaining, and improving their social impact. They assume they are doing a great job on the social side and that they deserve the additional funding, often without much systematic evidence. These are risky assumptions. Finding ways to sustain organizations that are not cost-effectively delivering social value is a terrible waste of energy and resources. Social sector leaders should look for creative resource strategies that enhance their impact, rather than simply sustain their organizations. By embracing a definition of social entrepreneurship that focuses on innovation and impact, we can assure that social objectives are taken seriously in the entrepreneurial process. In the end, social entrepreneurship must be about creating social value, not simply about making money.

I must acknowledge that I have always wanted to write on social entrepreneurship, the Nigeria Ways, for sometime now, but I sat on my computer and started typing after my last automobile state inspection to check emission and safety state of my vehicle (here again is an entrepreneurial opportunity created by government regulations – every automobile is mandated to go through this annual test for social and environmental reasons). I thought of what the auto technician said about Nigeria. The technician, an African Immigrant, (non-Nigerian) running his own auto shop said that he is disappointed with Nigeria and Nigerians. When I asked, why? He said, Nigeria, has the most intelligent people in Africa, the most educated in Africa, has the best and the worst number of people in African, has the greatest number of churches and mosques in Africa, has the most natural and human resources in African, but that the Nigeria problem is one thing – most Nigerians are double minded, and when a society has majority of double minded people, that society will see no good, no matter how that society tries. When I asked him to explain what he meant by being double minded, he said, a Christian or Moslem Nigerian will immediately consult with the juju priest the moment he or she is having life troubles. That he said is being double minded. He further said that being single-minded focus in beliefs is the bases of success in everything one does, whether one believes in Ancestral Spirits, Christianity, or Islam. To cap it all, he said that Nigeria is built on no foundation, therefore no Soul, and that is a major problem. That Nigeria has no uniting soul. That America, no matter what people may say about America, that America has a uniting soul in their majority belief of “In God We Trust.” And that, it doesn’t matter how or the means of the Trust in God by Americans, but you better believe, they trust in their God. My effort to remind him that Nigeria fore fathers, such as Zik of Africa, and few others had vision for a Nigeria built on solid foundation, and that Nigeria lost its foundation in the sixties, he concurred and said, well, we don’t live in the sixties, this is the 21st century, and Nigeria as of today can revisit the old vision as a source of its soul and foundation if it ever wants to grow.

This brings me to another question of the topic of this article, Social Entrepreneurship – the Nigeria Perspective. Are we as Nigerians double minded in social entrepreneurship? Has greed and selfish survival instinct robbed Nigeria the true meaning of social entrepreneurship endeavors initiated by a Nigerian?

“We have seen that the function of entrepreneurs is to reform or revolutionize the pattern of production . . .”
Joseph A. Schumpeter, Capitalism, Socialism and Democracy

Citizens should think about the mindsets of those seeking to serve them. Are they Socially and Capitalistic Entrepreneurial, or are they Political Entrepreneurs seeking public office positions to fulfill their self-serving interests?

Cletus E. Olebunne

Executive Director

October 2006

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Together we can build a nation where its economic strength is comparable to its individual citizen's capabilities. A 2020 Nigeria economy where manufacturing is the driving force. We are always glad to hear from you. 

ABOUT THE AUTHOR: Cletus E. Olebunne, Is the Executive Director of Nigerian Entrepreneurial Leadership (www.nel-m.org ) An accomplished scientist, and entrepreneur in the global healthcare product distribution. He is the founder of Eastern Pharmaceuticals (www.easternpharmaceuticals.com), a global distributor of healthcare products based in New Jersey. An active member of Regulatory Affairs Professional Society (RAPS), the global pharmaceutical regulatory body, the American Chemical Society, and the American Management Association (AMA).
The NEL organization seeks to:
1 Support and promote a community of entrepreneurs
2 Promote public understanding of manufacturing entrepreneurship
3 Promote and enhance the role models that reflect the ideals of manufacturing entrepreneurship
4 Be the source for information about best practices in business leadership.