Today: 31st August 2010

18th Birthday of my organisation, ThaiCraft

Morning:

a) SME and Social enterprises

b) Fair Trade and ThaiCraft

Afternoon:

Field visit to Prae Pan weaving villages(women’s community project)

Who am I ?

Stephen Salmon• Stephen, Steve

• Lung Steve, (Khun) Lung ,etc……

• Lived in Thailand for 33 years

• Lived/worked in Chiang Mai, Chanthaburi, Nan and

• I now live and work in Bangkok

• Visited (and driven) in all 76 changwat (provinces) of kingdom

Stephen Salmon Social Entrepreneur and Fair Trade Advocate

• Born, brought up in England. Had thirst for travel!

• Teaching – specialising in informal social provision for young people (who left school early, etc.)

• 1972-5 Chiang Mai, Thailand as volunteer teacher

• Married Suwadee in 1975 – returned to UK

• 1980 – Arrived back in Thailand to work with UK NGO in camps for refugees from Cambodia, Laos

• 1984 - Started local NGO for ethnic minorities in Nan province: craft marketing, slope agric., nutrition

• 1992 – started (with Suwadee and volunteers) ThaiCraft Association to run handicraft market in Bangkok for artisans nationwide

• 1995 – joined World Fair Trade Organisation

• 1998 – started exporting crafts worldwide

• 2001 – started ThaiCraft Fair Trade Co. Ltd. to professionalise marketing, export & domestic sales

• 2004 – daughter Rosalind started Phu Phiang Co. – community-based tourism, “craft and culture”

Stephen Salmon Social Entrepreneur and Fair Trade Advocate

English is my first (native) language

Who are you?• Afghanistan 1 m• Jordan 1 f• Myanmar 2 f, m• Indonesia 2 f, f• Sri Lanka 1 f• Laos 2 m,

m• Bhutan 2 f, m

• Peru 1 m• Philippines 1 f• Vietnam 2 f, m• Solomon Islands 1 m• Bangladesh 1 m• Mozambique 1 m• Nigeria 2 f, m• Columbia 2 ?,?

Total: 21 persons: ?? female, ?? male14 countries: 10 Asia, 2 Africa, 2 S.America, 1 S.Pacific

English is your second (third, etc.) language

The Business of SocietyToday we ask• What are businesses for?• What role does or can a business have in

improving our communities, society and the environmental issues that we face?

• What are the guidelines that we can follow to create a more equal and caring form of business?

• First, we must understand communities and how they work. And how people behave….

Q. What is the largest flower in the world?

A. “The Corpse Flower of Sumatra”

Titum Arum (amorphophallus titanum)

The outer spathe (petals) protect the flower inside

• Corn in ground grows to 4 ft diam (2 men to carry)

• Cone is 5 feet across

• Pollination by bees within

3 days of flowering

• Centre spike (spadix) is 10 ft (3 metres) tall used for sending perfume (smell) in waves a long distance in thick forest (one mile or more)

• inside cone, 2 bands of small florets with pollen.

• So, not the world’s largest single flower

Detail of florets or flowerets

Some people argue that It is not the largest flower in the world because it is not a single flower ……

Q. So, what is the largest single flower in the world?

A. Rafflesia (Rafflesia arnoldii)

also, from Sumatra, Indonesia, and Malaysia.

Rafflesia

Rafflesia arnoldii

Rafflesia Flower:

3 feet (1 metre) across

Pollinated by flies

Lies flat on forest floor - grows horizontally

Why is it so BIG?

Flies attracted by smell so it doesn’t need to be this size.

Gets its sustenance by stealing food from a creeping vine.

It is a parasite.

What’s the difference? • Titum Arum is a community of florets (tiny flowers)

Cleverly organising itself for sustained reproduction from its own resources – hence its tower and protective cone casing.

• Rafflesia doesn’t worry about resources.It steals from and lives on others to provide its food.It can have as large a flower as it wants – there is no good reason! A luxury …… so long as there is the vine.

• To which of these do we belong or want to belong? Titum Arum, Rafflesia …. or the vine?

Discussion Point - 1Our world has both poor and rich countries.

Almost all countries have some people and communities who are poor.

1) List the 3 most important reasons why there is poverty in your country.

2) If you could govern your country, how would you deal with these poverty problems?

(if you have time, list 5 reasons! In priority)

10 mins to think, discuss and write down

If you give me a fish you have fed me for a day.

If you teach me to fish…

…then I can feed myself …..

until the water is polluted …..

and the beach is seized for hotel development.…

…but if you teach me to

CREATE A SOCIAL ENTERPRISE…

…then whatever the challenge, I can join together with my community and we will develop our own solution.

What is a Social Enterprise?

Small & Medium-sized Enterprises (SMEs)

• Medium-size companies (up to 250* staff, growing, attracting new investment)

• Small businesses (up to 50* employees, low capital, start-ups)

• Micro-enterprises (one person, family, less than 10* employees)

• “Globally, SMEs account for 99% of business numbers and 40% to 50% of GDP”. (Wikipedia – citation?) EU definition.

What is the main purpose of SME – or any business?

What is the main purpose of a business? (objective)

to make a Profit• Profit for whom?

The owner, shareholder, investor

• Why do they deserve the profit?

Because they take the risk of failure (failure is more frequent than success) - they could lose everything!

Organisations that don’t make a (financial) Profit

• Charities

• Clubs and associations

• NGOs

• Foundations

If they are not meant to make a profit,

what is their main purpose?

social and/or community benefit

Social organisationsHow do they support themselves?

• Grants from govts, Intern’l organisations • Adoption by philanthropy fund (eg.Bill Gates)

• Donations from individuals • Fund raising activities (concerts, parties, fetes)

Are these methods sustainable?

• Some can be (if the cause is strong)

• Many cannot be. Donors hope for self-sustaining methods in the long run

• They will need to change to survive

Social Organisations (NGOs)

To sustain themselves

with an income and

a plan for the long-term,

many will (need to) create some

kind of Social Enterprise

Social Enterprises

are businesses with social objectives

whose surpluses (profits) are reinvested for that purpose in the business or in the community,

rather than creating profit for shareholders and owners

Social Enterprises

are businesses with primarily social objectives

whose profits are principally reinvested for that purpose in the business or in the community,

rather than being driven by the need to maximise profit for shareholders and owners.

Different from other social orgs.

• Social enterprises trade in goods and/or services in a market, so that they are business enterprises

• Social enterprises primary purpose lies outside the commercial outcomes related to their trading of goods and/or services in a market. The primary purpose is to solve social/environmental problems

“Profit” is Good!

Why do we need Profit? To….. – sustain and build the business further

– reward those who risk the investment

– encourage hard work and success

– enable personal life-style improvement, a viable career-path – not just a vocation

• But main reason for SE business itself is the social or community objective

• It’s what you do with profit that matters.

Reasonable

3 kinds of S.E.

1. Profit Generator (profits made to fund social programmes)

• Any trading to make most profit (activity may or may not be socially useful – that’s not the main purpose)

• Some or all profits are used to finance other activities that do have a direct social impact.

• More profits, more impact (e.g. Oxfam shop)

3 kinds of S.E.2. Trade-off (balance of profit or social impact)

• Trading itself has a direct social impact and this activity creates development and income for social target(s)

• Act of trading improves, expands impact more than profit. Choice between profits and impact.

3. Lock-step (more profit creates social impact) • The trading/service has itself a direct social

impact which is directly linked to the increase in profits. (e.g. wind-farm, cooperative)

Is the social impact dependent on profits? (if No = 2, if Yes = 3.)

SE: Creating a social and financial impact

• In UK today, 62,000 social enterprises (Based on Institute For Employment Studies Annual Small Business Survey 2005-07. SE equals 6% of all SME employers. Does not include sole traders)

– > £30 billion turnover (US$47,000,000,000)

– 5% of UK businesses are SE

– Employs directly 650,000 people

– 20% of SEs more than £1m turnover

– Contributes £8.4 b. to UK economy yearly

– 50% income of charities comes from SE

Could SE create an impact in your country?

SE in UK – recent surveys

During the recession, in UK, • 56% of SE increased turnover (28% SME)

• 66% making a profit, 16% breaking even

• Av. ann. turnover £ 175,000

• 41% of board mbrs women; 26% CEOs

• Public sector is a key customer: 39% income from government (local, national)

• 71% of SE earned most of what they needed (for their social cause)

Social Enterprises need Social Entrepreneurs

• “A reasonable person adapts him/herself to the world

• “An unreasonable person persists in trying to adapt the world to him/herself

• “Therefore, all progress depends on unreasonable people.”

George Bernard Shaw (1856-1950)

• Social Entrepreneurs are unreasonable people. They can be powerful people.

Social Entrepreneur‘Crazy’? but powerful, our future depends on their work

• Disregards normal society constraints• Applies practical solutions to social problems• Innovates to find new products or services• Focuses firstly on social value (before profit)• Acts before having the resources• Believes that anyone can do things• Takes risks others would not dare• Has passion for change & fire to measure impact• Can teach others who can make changes in society• Impatient – does not succeed well in bureaucracies

There are social enterprises everywhere, even if they are not recognised as such.

1) Name 3 organisations in your own country that can be called ‘social enterprises’.

2) Name 3 people who you think are real social entrepreneurs (in your country or elsewhere) and why (briefly!).

2) How can your government (or others) help those who do or who want to start SEs ?

10 mins to think, discuss and write down

Discussion Point - 2