The fight against poverty in the developing world continues to face a number of challenges. According to the World Bank, around eleven percent of the world population lives in poverty. At the same time, countries are also undergoing unprecedented development due to the efforts of national governments and various international organizations to implement major strategies designed to make a positive impact on the livelihood of people in developing countries. Social enterprises and nonprofit organizations are playing an increasingly significant role in these developments, helping to ensure that developing nations have the tools and resources needed to effectively combat poverty and other critical social issues.
Social enterprises and nonprofits are valuable when working alongside governments and the private sector because they can contribute to the development of critical regional infrastructure by spurring innovation, and their knowledge of local markets and ability to provide specialized solutions has made these organizations increasingly sought after by major donors. Because of their growing role in international development and helping those in need, it is important for international relations professionals to learn more about these vital nonprofit organizations and their operations.
Who Are These Organizations and What Do They Do?
A social enterprise is a group, company or organization that uses a traditional business model—i.e. the sale of goods or products—to help support its efforts to achieve notable social objectives. Social enterprises typically follow business models and use entrepreneurial activities as a means by which to find innovative solutions to complex problems; they then reinvest their profits into their operations in order to expand or improve their services. Many social enterprises create apps or websites to help reach more people and expand their impact. Examples include an app that connects farmers with local buyers, and another that determines the best places to obtain specialized medical services in countries with underdeveloped health care systems.
Social enterprises and nonprofit organizations seek to create positive social change in their local communities by providing a number of services targeted toward rectifying societal problems. In contrast to for-profit businesses, social enterprises seek to provide social capital in addition to (or instead of) making a profit. Nonprofit organizations, whether local, regional, national or international, direct their resources toward championing causes of social justice. Run by employees or volunteers, they can rely on grants or donations from the government, private sector, or international donors in order to fund their initiatives. In recent decades, nonprofit organizations have become a force to be reckoned with in international development and have a major seat at the table at several notable development conferences. As noted above, they have become integral in implementing development projects on behalf of major donors and international organizations. For instance, if the United Nations were to launch a project to fight deforestation, they may seek the aid of local nonprofits or social enterprises that have the knowledge, resources and contacts to help successfully implement the project.
Nonprofit organizations can also engage in a variety of activities that help provide impoverished populations with basic necessities, such as shelter and medicine. In many regions in Sub-Saharan Africa, nonprofit organizations are often communities’ only means of aid because government infrastructure and resources are deficient. Nonprofit organizations can also help raise awareness about certain problems through various fundraising campaigns, as well as represent to governments and larger international organizations the needs of these disenfranchised groups.
When and How Do They Operate?
Developing countries can benefit from working with nonprofits and social enterprises in two contexts: either in the event of humanitarian crises or during non-emergency situations. During disasters, nonprofit organizations and social enterprises can play a vital role in reaching remote populations, using their specialized knowledge and networks of staff and volunteers to provide badly-needed relief and aid such as medicine, food and other supplies. Understanding local communities and their needs allow nonprofits to help governments and other large international organizations better distribute essential services.
In addition to providing aid in the event of a disaster, nonprofit organizations and social enterprises are especially adept at finding solutions to the manifold problems facing communities; these include disease, famine, climate change and lack of clean water, among others. In collaboration with local communities, nonprofits and social enterprises can implement short- and long-term strategies for handling these challenges.
Social enterprises and nonprofit organizations can help create change in developing countries in three ways: through the use of existing resources to solve problems; via the improvement of existing programs, tools, and platforms; or by the creation of innovative techniques, solutions, products, and services designed to tackle societal challenges. Regardless of their chosen method, these organizations can either work independently with local communities, or partner with the corporate sector or larger nonprofits to create change. In addition to leveraging their resources and knowledge of the local community, social enterprises and nonprofit organizations are also increasingly focused on capacity building; this is achieved by empowering individuals and communities by providing them with the necessary skills, tools, and resources to deal with challenges on their own.
The role of social enterprises and nonprofit organizations in international development initiatives continues to expand, which has allowed for increased prosperity worldwide. Because they have the advantage of enjoying public trust and knowing their markets and communities well, these organizations can effectively bridge the gap between governments, international development agencies, and targeted end users in order to deliver more efficient services. Major international development players—such as the World Bank and the U.S. government, through agencies such as USAID—continue to dedicate increased resources to social entrepreneurship, working with local and national non-governmental organizations (NGOs) to successfully build and implement their development programs.
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Understanding Social Enterprise: Theory and Practice, Google Books
How Social Entrepreneurs Have the Most Impact, Harvard Business Review
The Prevalence and Determinants of Social Entrepreneurship at the Macro Level, Wiley Online Library
What is Social Entrepreneurship, Schwab Foundation for Social Entrepreneurship
Poverty, The World Bank
What is Social Enterprise?, Investopedia