The Role of Eco and Social Entrepreneurship in Sustainable Development - Coursework Example

The role of Eco and Social Entrepreneurship in Sustainable Development Name Institutional Affiliation The role of Eco and Social Entrepreneurship in Sustainable Development Introduction The world faces many social, economic and environmental problems today. At the same time, great concern has been raised over the unsustainable production and consumption patterns that have resulted in negative social and environmental impacts. Yet, the reality of more people living under the poverty line seems to be rising which calls for economic growth and development. Sustainable development has been identified as the best conduit of bringing the much needed solution to these problems. Entrepreneurship has been seen as a channel for sustainable processes and products. Entrepreneurship has also been considered a solution for many social and environmental problems. In most times, individuals who are concerned with societal and environmental issues are potential initiators or supporters of businesses that advocate for sustainable development. Terms associated with entrepreneurship and sustainability include; sustainable development, ecopreneurship, green entrepreneurship, environmental entrepreneurship, social entrepreneurship and sustainability entrepreneurship. Sustainable entrepreneurship involves sustainable development in organizations as well as in society. Sustainable development, Eco entrepreneurship and Social Entrepreneurship Sustainable development alludes to development whose economic outcome can last over a long time or development that is environmentally sound.1 It implies reducing poverty in a way that does not adversely affect the environment. Sustainable development is linked with societal issues as well as environmental issues. To come up with sustainable development, the strategies should focus on sustainability, the environment and society. Sustainable development entails the use of renewable sources and careful use of non-renewable energy in a way that their viability is extended to future generations.2 The concept of sustainability is a social issue since it influences societal level concerns. Brouard and Larivet define social enterprises as “organizations that pursue social missions or purposes that operate to create community benefit regardless of ownership or legal structures and in varying degrees of financial self-sufficiency, invasion and social transformation.”3 Haugh4 describe social entrepreneurship as “the simultaneous pursuit of economic, social and environmental goals by enterprising ventures.” Social entrepreneurship responds to individual and societal needs. Eco entrepreneurship, also known as ecopreneurship or environmental entrepreneurship focuses doing business while positively addressing environmental issues. Green entrepreneurship and ecopreneurship focuses organizations seeking cost efficiencies and economic profit through innovation of green products.5 Environmental entrepreneurship puts attention on economic opportunities resulting in natural environment market failures. It involves the creation of green products geared towards impacting the environment. The Role of Eco and Social Entrepreneurship in Sustainable Development Peterson6mentions the seven forces that are identified as responsible for changing the world. They include governance, conflict, globalization, information flows, technological innovation and diffusion, environmental degradation, resource management and population. According to Kury7 analysing the sustainability issue as an environmental issue is in line with the forces identified by Peterson. If sustainability is viewed as a social issue, then social entrepreneurship has a role to play in sustainable developments and the natural environment. In the Rio+20 United Nations Conference on Sustainable Development held in 2012 conceptualised sustainable development in three fronts; environmental, economic and social. Economic sustainability entails augmenting natural, human, social and physical capital to achieve lasting economic growth. The environmental aspect of sustainability involves using the natural resources in a way that they can serve future generations. Additionally, this involves embracing sustainable production and consumptions patterns. The social front of sustainability focuses on human equity and security. According to the European Commission8 issues like; accountable governance, accessible human rights and freedoms, social inclusion, education attainment, health, labour conditions, poverty rates and income distribution; are some indicators of social sustainability. Thus, sustainable development should factor in the economic, social and environmental dimensions. As such, social and eco entrepreneurship are examples of sustainable development. United Nations Environmental Program (UNEP) observed that as the millennium development goals drew near the deadline, it was realised that the growth being achieved is taking place but the planet’s life support systems are being destroyed.9 Sustainable entrepreneurship involves revolutionizing the production pattern through innovations to produce goods. Entrepreneurs that are driven by sustainability have their primary motivation as contributing to sustainability with a profitable enterprise taken as a means to achieving that end.10 Environmental problems are social problems since the choices that organizations have concerning sustainability impact on the society. In most cases, economic development, has been associated with exploitation of natural resources and environmental pollution. But as Azmat say, poverty reduction through innovative and creative ventures combines the concept so social entrepreneurship and bottom of pyramid (BoP).11 BoP describes the poor who are at the bottom of the social-economic ladder, who participate in the informal market economy. BoP is one way in which innovative strategies have been used by businesses to reduce poverty and remain profitable. Most of the time, BoP strategies have been used in large companies, most entrepreneurs have not embraced them. Given that social entrepreneurs have the power to change the lives of people and the social systems that bring about poverty, they should embrace this strategy more. Warnecke12 uses the case of micro-finance institutions to demonstrate how social and ecopreneurship helps in achieving sustainable development. To start with she argues that poverty leads to gender inequality since women and girls suffer and have to work extra to make ends meet. Microfinance participate in a number of ways to ensure sustainable development. First, microfinances gives starting capital to entrepreneurs, significantly impacting on poverty reduction. Poverty reduction does not only cushion families against vulnerability to environmental shocks, but they also decrease their need to overburden the natural environment for food and shelter.13 Secondly, microfinance institutions, through their activities, could have incentives for social and eco entrepreneurs by giving them lower interest rates. Again, they have the option of sponsoring and partnering with entrepreneurs to help them to transition to sustainable businesses. Social entrepreneurs focus on innovative initiatives that emphasizes on social gains rather than economic ones. Using the BoP approach eco and social entrepreneurs look at the BoP as customers and not charity recipients. Since this is a unique market, they need to come up with innovative ways in which traditional products and services are reinvented to serve this market. Research indicate that social entrepreneurs through adopting creative and innovative strategies reduce social problems to manageable levels. Social entrepreneurs have the potential of attaining economic and social goals by reducing poverty and improving the social welfare.14 One of the strength that social entrepreneurs have is that they have a more positive outlook compared to the rest of the population. As such, they are not likely to be disheartened by contextual constraints. Social entrepreneurs play a role by coming up with initiatives that alleviate poverty in an environmentally sustainable way which leads to sustainable development. According to Haugh,15 in most developing countries, mainstream entrepreneurs are not attracted by markets in times of market inflexibility, bureaucracy and financial limitations. In such conditions, it is the social entrepreneurs that perform the residual function and they are able to garner resources and capitalize in sub-market opportunities. For instance, in the case of developing countries, where the market and government structures are under-developed, social entrepreneurs come up with initiatives which have a bid potential of growing to a full-blown scale. Additionally, they uphold sustainable development by dealing with cultural, economic, social and human issues.16 The trend in most social entrepreneurs is that they identify opportunities in an innovative ways and tailor their enterprises to realise social outcomes like feeding the hungry, promoting education, and reducing poverty among others. Social and eco entrepreneurs have the potential of becoming catalysts for sustainable development. In most developing countries, social entrepreneurs face challenges in the name of inflexibility, lack of adequate access to finance and bureaucracies. Thus, social entrepreneurs start small innovative and creative ventures which reflect to change on the short-term.17 However, the small changes become develop with time to initiate social transformation and give birth to bigger ventures in the long run. Waste Concern,18 a waste recycling company in Bangladesh, seeks to promote sustainable development through job creation which aids in poverty reduction, to improve the environment and to recycle waste. Although the company faced start-up problem with bureaucracies, the company has been able to establish itself and has succeeded in creating a way of disposing waste effectively. It has also been able to improve the lives of the BoP and improve the economic standards. Again, effective waste disposal and recycling of most waste has had positive environmental results19 Another area of social and eco entrepreneurship that has a great potential for sustainable development is rural agricultural and non-agricultural entrepreneurship. According to Sima20 rural social and eco entrepreneurs set up their enterprises in the rural areas using the raw materials readily available and create jobs to the people there. Sima21 gives an example of Romania whose rural areas are said to cover 87 percent of the country. Since most of the people are in the agricultural sector, social entrepreneurs dealing with non-agricultural activities, like catering for tourists, ensure economic development and it has an environmental impact. The role of green entrepreneurs in achieving sustainable development involves innovations and ventures that reduce the adverse effects of environmental degradation, pollution, and climate change issues among others22. One of the areas that most entrepreneurs in this area are involved in is in making of solar products that can be accessible to most people including the BoP. Solar products reduce emissions and go at a reduced cost for the customer compared to other sources of energy. As earlier mentioned, waste management through recycling have both environmental and social benefits. Another areas is promotion of conservation and biodiversity. Eco entrepreneurs have a role to not only come up with creative and innovative ways of conserving the environment but also in training members of the community in these efforts. For instance in most developing countries, many entrepreneurs have an alternative source of income through planting trees and cultivating medicinal plants. Carrying out community environmental education by the entrepreneurs does not only ensure they have customers for their products, but it also ensures that they achieve their end protecting the environment. Conclusion As already discussed, sustainability, the environment and the society are intertwined. While eco entrepreneurs seek to protect the environment through businesses innovations, they contribute in alleviating social problems and promote sustainable development. At the same time, while social entrepreneurs seek to address social issues through innovative and creative ways, they contribute to sustainable development and positively impact the environment. Both eco and social entrepreneurs have a great potential of initiating and supporting sustainable development. Bibliography Azmat, Fara. "Sustainable Development in Developing Countries: The Role of Social Entrepreneurs." International Journal 0f Public Administration 36, no. 5 (2013): 293-304.  Brouard, Francois and Larivet Sophie. “Essay of clarifications and definitions of related concepts of social enterprise, social entrepreneur and social entrepreneurship”, in Fayolle, A. and Matley, H (ed) (2010), Handbook of research on social entrepreneurship, Chelternham, UK: Edward Elgar Publishing Limited, 29-56. European Commission. “A Framework for Indicators of the Economic and Social Dimensions of Sustainable Agriculture and Rural Development.” Brussels, Belgium: European Commission, 2001 Hall, Jeremy K., Gregory A. Daneke, and Michael J. Lenox. "Sustainable Development and Entrepreneurship: Past Contributions and Future Directions". Journal of Business Venturing 25, no. 5 (2010): 439-448. Haugh, Helen. "New strategies for a sustainable society: the growing contribution of social entrepreneurship." Business Ethics Quarterly 17, no. 4 (2007): 743-749 Haugh, Helen. “A research agenda for social entrepreneurship.” Social Enterprise Journal 1, no. 1 (2005): 1-12. Konda, Iva, Jasmina Starc, and Barbara Rodica. "Social challenges are opportunities for sustainable development: tracing impacts of social entrepreneurship through innovations and value creation." Economic Themes 53, no. 2 (2015): 215-233 Kury, Kenneth Wm. "Sustainability Meets Social Entrepreneurship: A Path to Social Change through Institutional Entrepreneurship." International Journal of Business Insights & Transformation 4, (2012 Special Issue 2012): 64-71 Peterson, Erik R. "Seven Revolutions: Global Strategic Trends out to the Year 2025".Multinational Business Review 12, no. 2 (2004): 111-120. Seelos, Christian and Mair, Johanna. “Sustainable development: how social entrepreneurs make it happen. IESE Business School Working Paper Series, 611: 1-14. Barcelona, Spain. Sima, Elena. "Sustainable rural development through rural entrepreneurship." Agricultural Management / Lucrari Stiintifice Seria I, Management Agricol 17, no. 1 (2015): 89-94 UN Environment Program (UNEP). “Integrating the Three Dimensions of Sustainable Development.” UNEP Post 2015 Note No. 1. Nairobi, Kenya: UNEP, 2013 Warnecke, Tonia. "“Greening” Gender Equity: Microfinance and the Sustainable Development Agenda." Journal of Economic Issues (M.E. Sharpe Inc.) 49, no. 2 (2015): 553-562 "Wasteconcern.Org". Wasteconcern.Org. Last modified 2016. Accessed May 6, 2016. http://www.wasteconcern.org/about.html Read More