Social Capitalist - A Set Of New Ideas

I came across Fast Company Annual Social Capitalist awards in this issue of Januray 2005. It lists out 25 companies - from a larger list of nominees - which aims to make a significant social impact through its business models.

The list is US-centric, but it is an interesting categorization. Such businesses do exist in Asia, Dr. Younis' Grameen Foundation in Bangladesh and BRAC, also in Bangladesh, or Amul in India will fall in this category. However, in Asia, such are not called businesses [Amul is], and labelled as charity/foundation/trusts whatever, which means they can not seek profits, and general shareholders can not take part in these businesses.

This model, in the context of the modern world, needs to be revisited, both by entrepreneurs and the governments. Our societies are now becoming the frontiers of global business, and there is huge unutilised potential in the sectors like Education, Health and other services. Legislating to keep most of these sectors in a non-profit mode will keep such provisions restricted, supply of resources - capital and skills - constrained, and allow corruption and malpractises.

Think of higher education in India. The market realities made Government policies look foolish and hopelessly outdated. IT education long bypassed government policy in India, and grew regardless. The issues with this kind of growth is that it becomes unregulated, and often breeds corruption and inefficiency. Today's unequipped and outmoded Engineering colleges, run by bogus trusts and old-era entrepreneurs, illustrate the point.

Time now for legislators to look at the possibility of creating appropriate regulatory mechanisms and allow smart, new age entrepreneurs to enter these businesses of public service provision. I see a great future of micro-enterprises springing up in various areas. Time to institute a Social Capitalist award for India.