The tricky part here is the degree to which commitments are being translated into action. Although announced in 2014, the India Fund is still designing the specifics regarding the who, why and how of the distribution of this money. Thailand’s pledge appears to have remained just that thus far. There is also great variability in the region on what constitutes a social enterprise. The write-up for the India Fund highlights the goal of supporting worldclass enterprises that focus on the problems of the poor. This is a broad definition. The South Korean definition stresses the primacy of the social bottom line: “a company which performs business activities while putting priority on the pursuit of social purposes”. Thailand narrows the definition by stipulating that social enterprises should reinvest profits. However, one thing is clear. A social enterprise must perform the delicate balancing act of meeting its financial obligations while staying true to its social imperatives.

 

A challenge from an unexpected source arises here: social enterprises themselves. Although more government and private funding is available, there simply may not be enough social enterprises yet to receive the funds. Part of the reason is that in places like China and Hong Kong where social enterprises originated as non-profits, many remain small and lack the business acumen to scale up. Another reason is that existing businesses that may operate as social enterprises are not aware of this classification and so do not explore funding available for social enterprises.

 

Governments must work hard to not only make resources available, but also to disseminate information about these resources and raise awareness about social enterprises. It is worthwhile to look into legislation specifically for social enterprises. This could both incentivise traditional businesses to add social impact to their bottom line, and encourage start-up growth in this space. Heartening as it is to see Asian governments allocate resources to social enterprises, there is more they can do to play the role of a great enabler of the fourth sector.

 

There is no doubt about the widespread enthusiasm and support for the creation and growth of social enterprises across Asia. Governments recognise that the most important component of government schemes is the availability of capital, especially in the start-up phase of the effort. There is also recognition of the support services required to move social enterprises along the spectrum from uncoordinated innovation to coordinated and effective innovation. Most encouragingly, contrary to how government departments traditionally function, agencies supporting social enterprises are embracing Silicon Valley-style innovation and trying to be nimble in response to needs.