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Corporate Role in Promoting Social Entrepreneurs

2010. 6. 3

Nam, Young-ChanVice President of SK Telecom

How to Identify and Support Social Entrepreneurs?Young-Gak (Ken) Yun, Chairman/CEO of Samjong KPMG

Jun. 3, 2010

Samjong KPMG Group

© 2010 Samjong KPMG ERI Inc., the Korea member firm of KPMG International Corporation, a Swiss cooperative. All rights reserved. Printed in Korea.

ContentsContents

Shifting Paradigm1

Identifying Samjong KPMG’s 7 key values2

Our CSR Activities3


“Business cannot succeed

in a society that fails.”

“Business cannot succeed

in a society that fails.” Source: WBCSD, Sustainability through the market, 2001


Tracking corporate competitiveness based on non-financial performance indicatorsTracking corporate competitiveness based on non-financial performance indicators

Note: GDP per Capita = 2009source: IMF World Economic Outlook Apr. 2010, Samjong KPMG ERI

Other EU Countries30,844

52 Turkey, 8,723

South Africa,5,824

3

Saudi Arabia, 14,486

India, 1,0301

Indonesia, 2,0300

Australia45,587

Korea, 14,946

Japan39,116

Russia, 8,230

China, 3,6781

UK, 35,334

France,42,747 Germany, 40,875

Italy, 35,435

The ratio of the number of firms participating in DJSI World versus G20 GDP per capita

0 Mexico, 8,135

Argentina, 7,726

Brazil, 8,220

7

51 USA, 46,381

Canada, 39,66911

32

020

6

022

0

011

6023

Unit: “O” = GDP per Capita (USD),Number = No. of Companies

The number of Asian firms that have joined the DJSI index is small relative to the sizes of economy. DJSIindex evaluates firms based on their economic, environmental and social performance indicators.


Samjong KPMG: 7 ValuesSamjong KPMG: 7 Values

v We lead by examplev We work togetherv We respect the individualv We seek the facts and provide insightv We are open and honest in our

communicationsv We are committed to our communitiesv Above all, we act with integrity


Samjong KPMG: PPC systemSamjong KPMG: PPC system

PPCPPC(People, Performance & Culture)

Achieving business outcomes through a ‘people’ agenda

Dialogue SystemDialogue System

Performance evaluation system

l Communicate, communicate, and communicate

l Every partner must take personal responsibility

l The senior partner owns and leads the People Strategy


Female Social EntrepreneursFemale Social Entrepreneurs

Samjong KPMG gave consecutive births to the first and second female partners everin the history of this industry. Samjong KPMG also fosters female socialentrepreneurs through the enforcement of employment quota (%) for women.


CSR Activities - OverviewCSR Activities - Overview

DevelopmentEducation

Local Community

ProgramEnvironment

Samjong KPMG carries out various activities in areas of education, environment, internationaldevelopment, and community welfare. It also actively participates in resolving global challenges,such as climate change.


CSR Activities - EducationCSR Activities - Education

SIFE(Student in Free Enterprise)Nurturing future leadersSIFE(Student in Free Enterprise)Nurturing future leaders

Lee Myung-joon, wrestlingLee Myung-joon, wrestling

Supports young Olympic athletesSupports young Olympic athletes Baritone singer, Lee Eung-kwangBaritone singer, Lee Eung-kwangAdvisory program for small and mid-sized firmsAdvisory program for small and mid-sized firms


CSR Activities – International DevelopmentCSR Activities – International Development

FloodFlood

EarthquakeEarthquake

FireFire

Oil spillOil spill


CSR Activities - EnvironmentCSR Activities - Environment


CSR Activities – Local Community ProgramsCSR Activities – Local Community Programs

Beautiful Partnership

Supports a Korean organ donor programSupports a Korean organ donor program

Participates in ablood donation programParticipates in ablood donation program

Supports the Terry Fox Run,annually held fundraising event for cancer research

Supports the Terry Fox Run,annually held fundraising event for cancer research

Takes part in a campaign to deliver briquettesto needy neighbors

Takes part in a campaign to deliver briquettesto needy neighbors

Participates in a dialysis donation programParticipates in a dialysis donation program

Supports Friends on the Path, a non-profit fundraising organization for the poor and minorities

Supports Friends on the Path, a non-profit fundraising organization for the poor and minorities

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How to Identify and Support Social Entrepreneurs?

Young-Gak (Ken) Yun, Chairman/CEO of Samjong KPMG

Whenever I hear “social entrepreneur” or “corporate social responsibility,” I am

reminded of a personal experience. My first step into society after graduation was

the US. Young and passionate, I worked harder than anyone else to be the best.

Therefore, I got great results, and naturally expected the evaluation and reward

that measure up to such outcome. However, I did not receive what I expected,

and after troubling myself for a while, I visited the HR. Having listened to my story,

the manager asked me whether I have read the company policy carefully. I

answered that I knew the general rules well enough. Then the manager brought

out the company code book and asked me to read the marked part. It read ‘all

employees have the responsibilities to perform community service for at least 5%

of his/her total work hours and to report it.’ You guessed right. I had received

good work evaluation, but in the category of social responsibility, I had received

‘zero’ points. The HR manager advised me to visit the counselor of social

volunteering, who can help me choose a field of interest for volunteering.

This experience, after thirty years, has become a central ideology to business

management for me and my employees. For the past two decades, Samjong

KPMG, in efforts to advance Korea, has strived to behave as a responsible

corporate citizen, to promote world-class corporate ethics, and to strengthen

community ties through cooperation with volunteering organizations. To this day,

it has not once digressed from this goal and has actively applied these values. In

retrospect, the firm I had worked for thirty years ago already had known how to

foster and assist social entrepreneurs, and was putting into practice.

Corporate Social Responsibility (CSR) has become an increasingly important

factor to business management with the growing influence of private firms. Since

the late 1990s, with increasing environmental and social problems, the paradigm

of business management has come under scrutiny.

In fact, over the past decade, from a CSR aspect, we have obtained valuable

experiences from the Asian financial crisis and the global financial crisis.

Countless number of firms went bankrupt, and with national economies in swing it

proved how influential private firms are to society today.

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However, according to a recent study conducted by IBM on 224 business leaders

worldwide, 60% of the participants were aware of the importance of CSR,

whereas only 30% responded that they were collecting information and paying

attention to market opinions. In reality, the level of corporate sustainability

management (CSM) is very low.

Correspondingly, the social demands to private firms are becoming more complex

and diverse. This is because the paradigm is shifting from a traditional approach

focused on short-term profit gain to a sustainable business management

paradigm. Under the new paradigm, businesses emphasize enhancements in

corporate governance, transparency and ethics, and value environmental and

social responsibilities. This is due to the dissemination of an understanding that

businesses cannot survive in the long-run if it only cared about economic

performances. The corporate environment today has reached a state where

various aspects including environmental risk, social risk, and economic risk must

be taken into consideration. Firms need to be environmentally friendly, socially

responsible, and competitive in the fast-changing market. The public image of

firms particularly affects sales today, rather than the product and the quality

themselves. It would not be an overstatement to say that the public image of a

firm determines its value. Consumers today are not simply buying products, but

are purchasing corporate image itself, and when deciding on which product to

buy, the social credibility of the firm built over an extended period of time

becomes an important determinant.

In addition, as the demands for corporate social responsibility increase both in

and out of country, CSR has become the key element to corporate

competitiveness. As interest groups like consumers, investors, and NGOs, mature

in social consciousness, they increasingly demand firms to act socially

responsible. International institutions, such as the UN, OECD, ISO, Global

Reporting Initiative (GRI), have strengthened regulations and systems on

corporate social role and responsibility, which include business transparency,

labor, environment, consumer protection, and social contribution. Moreover,

regarding global standardization, there is a growing trend towards promoting an

integrated sustainable standardization, going beyond partial standardization.

WBCSD (World Business Council for Sustainable Development) mentioned that

future firms that succeed will be those that not only provide products and

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services, but those that will contribute in resolving key global challenges, i.e.

poverty, climate change, resource scarcity, globalization, and overpopulation.

Therefore, like the saying, ‘business can not succeed in a society that fails,’

firms must actively participate in CSR activities for the purpose of survival more

than ever. This requires employees with social entrepreneurship. Employees are

on common grounds with various interest groups of the firm, and are key

channels of communication with the public. Thus, we are at a point where there

must be extensive efforts in fostering talented individuals with social

entrepreneurship for the purpose of achieving sustainable development.

The fact that many Korean firms are strategizing activities of social contribution

and increasing measures to promote internal participation is great news.

Samjong KPMG too is running a PPP system and operating various activities

under the social welfare group to find and develop social entrepreneurs.

Samjong KPMG’s HR system

Samjong KPMG does not have an HR Department, and instead has a ‘PPC

Department.’ PPC stands for People, Performance & Culture. People represents

the fact that people are firms greatest asset. Performance means evaluation and

Culture indicates institutional culture. In other words, it goes beyond the general

functional meaning of HR, and is Samjong KPMG’s business strategy, which value

human resources; performance measure that aligns with people strategy; and

original people strategy that targets culture creation.

In order to firmly maintain and develop people strategy, we have established five

basic rules. They are the following:

There are five fundamental steps to ensure that the People strategy is embedded

into business. The five fundamental steps are:

1 The senior partner owns and leads the People strategy;

2 A board level partner drives the implementation;

3 Every partner must take personal responsibility;

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4 The firm dedicates time and resources to people managers; and

5 Communicate, communicate, communicate.

As the five steps show, the strong drive of the top management and

‘communication’ are the most important aspects of finding and nurturing social

entrepreneurs. Samjong KPMG runs a performance evaluation system called the

Dialogue System that enforces the five fundamental steps. Dialogue System, just

like the literal meaning of ‘dialogue,’ means communicating on the subject of

individual performances.

It is not a one-sided evaluation by a counselor, but a three step process of goal

setting, interim reviewing, and year end reviewing. The counselor and the

counselee have a one-on-one meeting in which they together set a goal and

evaluate performance results based on that goal.

Samjong KPMG gave consecutive births to the first and second female partners

ever in the history of this industry. Samjong KPMG also fosters female social

entrepreneurs through the enforcement of employment quota (%) for women.

‘Corporate citizenship’ of Samjong KPMG does not only indicate charity activity or

volunteering of the employees. It is a strong willingness and a promise, as well as

actions, to build a sustainable community through responsible decision-making

during the processes of doing business; minimizing negative impact in building

relations with the society; and using our resources in an eco-friendly manner.

Samjong KPMG carries out various activities in the fields of education,

environment, international development and social welfare. We are also actively

participating in resolving global challenges like climate change.

Education

Samjong KPMG is well aware of the potential of infinite value creation through

education. Therefore, it focuses on educational assistance, utilizing the

organizational expertise in intelligence. In efforts to achieve “equality in

education,” stated in Article 31 of the Constitution, as well as the Educational

Law, it supports education of the poor and minority classes.

5/6

Moreover, it takes part in a program that aims in developing globally competitive

college students by utilizing the know-how of Samjong KPMG employees. It also

gives regular financial assistance in the area of sports to future athletes of less

popular sports events.

In addition, it provides free consulting in the specialized areas of accounting and

business management to small and mid-sized firms or NGOs that lack in know-

how. This program promotes stable business growth.

Example(Lee Myung-joon, Lee Eung-kwang):

Lee Myoung-joon (born in 1990, 21 years old), sponsored by Samjong KPMG,

currently attends Korea National Sport University and is on his way to becoming a

professional sportsman, despite financial difficulties. While still a high-school

student, he kept up his studies, while practicing sports, and earned an

outstanding academic record. He won 1st place in 2007 National Competition,

3rd in 2008 World and Asian Junior Competition, 1st in 2008 Competition of

Minister of Culture, Sports and Tourism, and silver medal in 2009 National Sports

Competition. He is expected to be the next Olympics star.

Opera singer Lee Eung-kwang( born in 1981) also did not give up on his dream,

despite his family being poor. He won the Alexander Girard International Singing

Competition, received the special award at the Francesco Vinas Competition, and

won the Ricardo Zandonai International Singing Competition. He currently

performs on international stage as a singer at the Swiss Basel Opera House under

an exclusive contract.

Development

According to World Bank, 1.4 billion people in the world, ¼ of the total world

population, still live under absolute poverty. They live under 1.25 dollar a day from

a purchasing power standard. Moreover, the entire human civilization is suffering

from climate change, such as from natural catastrophes and wars. Numerous

international organizations and private NGOs are at the forefront, busy trying to

relieve people from such difficulties. They desperately need financial,

technological, and human assistances. Samjong KPMG, as a world corporate

citizen, is proactively supporting international relief and development activities by

utilizing our resources, such as raising funds.

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Environment

Environmental problems are not one nation’s problems. Climate change above all

other environmental challenges requires the most immediate and serious

response. It is impossible to respond to the global warming and climate change

through the traditional ways of running economy. Everyone in the world is already

exposed to the direct and indirect consequences of these environmental changes.

In order to reduce greenhouse gas(GHG) emission and environmental pollution,

the policy of ‘green development,’ a sustainable development, is promoted as a

development strategy. Here, the role of firms is essential. Samjong KPMG carries

out Green initiative, which pursues environmentally friendly business activities,

and is taking a lead in green development by assisting organizations like

environmental NGOs.

Local Community Program

A business creates market within a community, and supplies its labor force from it.

For the purpose of a healthy community development, it is necessary to interpret

the various activities of businesses not from a charity perspective, but from a

long-term investment and redistribution perspective.

Samjong KPMG cooperates with various social welfare organizations ranging from

grassroots organizations like orphanages to international institutions like the Red

Cross. Employees also voluntarily participate in various program of these

organizations, in order to build a better community.

Overview of Social Entrepreneurs and Corporate Role

Current Tasks for Social Enterprises

Conclusion

SK’s Support for Social Entrepreneurs

• Dual Nature of Social Enterprises • Social Enterprise as Evolution of Corporate Social Contribution Model• Limitations of Social Enterprises from the Standpoint of Corporate Competitiveness and Improvement Measures

• Overview of Social Entrepreneurs in Korea• Corporate Role in Supporting Social Entrepreneurs

• SK’s Corporate Philosophy and Social Enterprises • SK’s Support Activities for Social Entrepreneurs

2

Dual Nature of Social Enterprises

Social enterprises are in line with the global trend in which the boundaries are blurring between the for-profit and non-profit sectors.

Akin to a non-profit organization that pursues a public objective, a social enterprise pursues a social purpose. A crucial point, however, is that a social enterprise must have the ability to generate profits through business activities as a means of realizing its social objectives.

Assuming that all other competitive factors are equal, a social enterprise which simultaneously pursues social value and economic value will usually stand at a disadvantage compared to a regular enterprise that solely pursues economic value.

A social entrepreneur must have a balanced view of the contradicting non-profit value and corporate value and exercise the ability to overcome related obstacles in order to ensure survival over the long run.

3

For the most part, corporate philanthropy in Korea used to comprise donations to NGOs and local communities along with volunteering.

A more strategic approach of harnessing corporate competencies to tackle major social issues emerged from the early 2000s.

Social enterprises started to draw attention from the business community as a means of resolving social problems via the corporate mechanism.

The social enterprise can be seen as evolution in the model for corporate social contribution.

Social Enterprise as Evolution of Corporate Social Contribution Model

4

Limitations of Social Enterprises from the Standpoint of Corporate Competitiveness and Improvement Measures

Promoting mechanisms such as social venture capital Creation of various types of funds to promote social enterprises

Provision of Start-Up Funds

Link with For-Profit Sector

Promotion of Competitive

Social Entrepreneurs

Personnel and financial support as social contributionPurchase of goods and services via business partnerships

Social entrepreneurs have to maintain a balance between their duty to create social value and the ability to generate economic value. Business acumen and entrepreneurial spirit are pivotal to the pursuit of economic value.

The promotion of social entrepreneurs is a key factor in determining the success or failure of a social enterprise.

5

Overview of Social Entrepreneurs in Korea

Longest term of employment

NPO33.3%

Civic groups25.9%

For-profitorganizations

16%

EducationalInstitutions

Gov. agencies4.9%

Other13.7%

Most important prerequisite for profit generation

Greatest difficulty facing managers of S.E.

93.8%

80.2%76.5%

66.7%

BizModel

Gov.support

Market protection

Partnershipwith

corporate sector

Finance40.7%

Harmonybetweensocial &

biz value 16%

Relationship with biz partners

3.7%

HR16%

Productdevelopment

14.8%

Other8.8%

Source : 『New future, Social Enterprise』(HERI)

The greatest hurdle facing social entrepreneurs in Korea has to do with bolstering corporate competitiveness.

6.2%

6

Corporate Role in Supporting Social Entrepreneurs

Developing business models that are innovative in diverse aspects such as the production system and value chainBringing together society’s diverse assets & capabilities via networking

Finding Business Models

Start-Up Funds for Social Enterprises

Pro BonoActivities

Direct investment in a social enterprise related to a company’svalue chain or business portfolio Greater involvement in supporting social entrepreneurs

Management consulting for social enterprises (HR, finance, accounting, marketing and legal affairs)Potential for more specialized volunteering activities.

Honing Capabilities ofSocial Entrepreneurs

Corporate input in opening courses to enhance businessknowhow and entrepreneurial spiritIn-house programs linked to retirement schemes that help retirees apply their accumulated expertise for social entrepreneurship

7

SK’s Corporate Philosophy and Social Enterprises

SK pursues values with the goal of contributing to stakeholders’ happiness through sustainable growth.

Under its corporate philosophy, SK launched social job creation programs in the early 2000s and is preparing to upgrade some programs to social enterprises.

SK has donated start-up funds for a total of 52 social enterprises. Thirty of them have been certified as social enterprises by the Ministry of Labor.

In 2009, SK announced a long-term plan designed to offer systematic support for launching and promoting social enterprises. Two key points: To create a social enterprise model to find innovative solutions to social problems and to foster a social enterprise ecosystem.

8

SK’s Support Activities for Social Entrepreneurs

In November 2009, SK launched “Sesang”, a collaboration network that brings together the expertise of diverse sectors.

The “collective brain power” contributes to turning ideas into refined business models.

Promising business items are nurtured through competitions.

Business Models based on Collective Brain Power & Start-Up Assistance

ProposalOnline

community Review Support

1-page summary of idea or

business proposal

Refine idea using collective

brain power

3-stagecompetition

Investment, consulting, etc.

www.se-sang.co.kr

9


Pro Bono Management Consulting Example : Orgdot

9 pro bono consultants from SK provided consulting for 6 months as Orgdot faced a management crisis (July~Dec. 2009).

Reached BEP for the first time in March 2010.Revenues to increase three-fold in 2010.

Marketed eco-friendly uniforms to SK baseball team.

Introduced in 2008

In September 2009, SK formally launched the “SK Pro Bono Management Consulting Volunteer Group.”

About 200 employees are serving as pro bono consultants in seventeen SK Group affiliates.

10


Discovering and Training S. E. S.E. Promotion Funds and Support Organization

Played a major role in the launch of Korea’s first academy specializing in training social entrepreneurs in 2006.

Launched the “Social Enterprise Start-Up Academy” in 2009.

Enhancing capabilities of social entrepreneurs via online and offlinetraining.

Finding and nurturing prospective social entrepreneurs via “Sesang” website.

Set up “S.E. Division” under Happy Nanum Foundation at the end of 2009 to assist social entrepreneurs and social enterprises.

Decided to raise KRW50 billion to promotesocial enterprises and has so far createda fund worth KRW10 billion.

11

Conclusion

Despite their short history and weak infrastructure, social enterprises in Korea have laid initial roots based on cooperation among the government, civic groups, and businesses.

The corporate sector has the means to support social entrepreneurs in terms of business knowhow, funds, assets, infrastructure, purchasing and pro bono activities.

Integration of corporate assets and abilities will contribute to driving balanced growth of social and economic value and bolstering the social entrepreneurial spirit.

A greater number of companies should participate in the process of transferring corporate competencies.

Thank YouThank You

Corporate Role in Promoting Social Entrepreneurs

Nam, Young-Chan (Vice President of SK Telecom)

1. Current Tasks for Social Enterprises

A. Dual Nature of Social Enterprises

Social enterprises are in line with the global trend in which the boundaries are blurring

between the for-profit and non-profit sectors. Akin to a non-profit organization that

pursues a public objective, a social enterprise pursues a social purpose. A crucial point,

however, is that a social enterprise must have the ability to generate profits through

business activities as a means of realizing its social objectives.

The problem is the hybrid nature of a social enterprise. That is, its purpose of creating

social value through the use of corporate mechanisms could adversely affect business

activities, which determines the sustainability of the social enterprise. Assuming that all

other competitive factors are equal, a social enterprise which simultaneously pursues

social value and economic value will usually stand at a disadvantage compared to a

regular enterprise that solely pursues economic value.

For the above reason, a social entrepreneur must have a balanced view of the

contradicting non-profit value and corporate value and exercise the ability to overcome

related obstacles in order to ensure survival over the long run.

B. Social Enterprise as Evolution of Corporate Social Contribution Model

For the most part, corporate philanthropy in Korea used to comprise donations to NGOs

and local communities along with volunteering.

However, a more strategic approach of harnessing corporate competencies to tackle

major social issues emerged from the early 2000s. That is, the corporate sector began to

carry out social contribution activities related to business strategies and pursued more

effective social change.

Subsequently, social enterprises started to draw attention from the business community

as a means of resolving social problems via the corporate mechanism. Civic groups also

started seeking collaboration with the business sector amid the pervading view that

corporate competitive factors were important in running a social enterprise.

In this regard, the social enterprise can be seen as evolution in the model for corporate

social contribution.

C. Limitations of Social Enterprises from the Standpoint of Corporate

Competitiveness and Improvement Measures

Social enterprises are displaying rapid growth in Korea. However, they have several

limitations in terms of corporate competitiveness since most of them were established

by civic groups and they are still in the nascent stages.

① Provision of Start-Up Funds

Start-up capital and funds play a crucial role in expanding the launch of social

enterprises. It is essential to promote mechanisms such as social venture capital which

invests in social enterprises. Other necessary measures include the creation of various

types of funds to promote social enterprises and directing a part of funds from the

Community Chest of Korea towards social enterprises.

② Link with For-Profit Sector

Cooperation between regular enterprises and social enterprises could take the form of

social contribution or business partnerships. The former may comprise personnel and

financial support offered to social enterprises, while the latter could be the purchase of

goods and services by regular companies. However, productive cooperation between

regular and social enterprises is limited in Korea. Moreover, social enterprises lack the

capacity to build and maintain cooperative ties with the corporate sector.

③ Promotion of Competitive Social Entrepreneurs

Due to their hybrid nature, social entrepreneurs have to maintain a balance between

their duty to create social value and the ability to generate economic value. Business

acumen and entrepreneurial spirit are pivotal to the pursuit of economic value, that is,

the generation of profits through business activity.

However, social enterprises established and run by civic groups lacked managerial ability.

On the other hand, personnel from companies that support social enterprises lacked

social innovation and leadership to address problems in society. This raises the need to

nurture social entrepreneurs who exhibit both sets of capabilities.

Start-up funds, links with the for-profit sector, and promotion of social entrepreneurs

represent desirable ways to drive sustainable growth of social enterprises through

corporate involvement.

In particular, the promotion of social entrepreneurs is a key factor in determining the

success or failure of a social enterprise. It also presents a means of providing effective

assistance by utilizing business knowhow. This is because companies possess the

entrepreneurial spirit that enables them to develop new business models and pursue

innovation in a changing environment, in addition to material assets.

2. Overview of Social Entrepreneurs and Corporate Role

A. Overview of Social Entrepreneurs in Korea

The majority of social entrepreneurs in Korea previously worked for non-profit

organizations or civic groups, according to a survey on social enterprises certified by the

Ministry of Labor conducted by the Hankyoreh Economic Research Institute in 2008. Of

the total survey respondents, 72.8% said they had worked in a non-profit organization,

with the average years of employment being 9.9 years. Those with experience in civic

groups came to 44.4%. The percentage of respondents who worked in for-profit

organizations, such as corporations and financial institutions, was lower at 38.3%. The

longest term of employment was with non-profit organizations (33.3%) and civic groups

(25.9%), while the figure was just 16.0% for for-profit organizations.

As the most important prerequisite for profit generation by social enterprises, the

majority of respondents (93.8%) pointed to “finding an independent business model.”

That was followed by “increased government support” (80.2%) and “the protection of

markets for social enterprises” (76.5%).

When asked about the greatest difficulty facing managers of social enterprises, 40.7% of

respondents answered “financial problems.” That was followed by “harmony between

social value and business gains” (16.0%), “human resources management” (16.0%), and

“product development and business planning” (14.8%).

On the whole, the greatest hurdle facing social entrepreneurs in Korea has to do with

bolstering corporate competitiveness.

B. Corporate Role in Supporting Social Entrepreneurs

Korean social entrepreneurs face the challenge of having to pursue both social value and

economic value despite inadequate social support. This implies the need to resolve

diverse issues such as finding a business model, shortage of funds, lack of management

knowhow and raising the competencies of social entrepreneurs. The present obstacles

could be tackled if companies effectively transfer their assets and capabilities to social

enterprises and social entrepreneurs.

① Finding Business Models

One of the roles of social entrepreneurs is creating sustainable business models. It is

crucial to have a precise and detailed strategy on the types of products and services to

be supplied, the target customers and marketing plans to ensure sustainable

development of a social enterprise.

As social entrepreneurs simultaneously pursue economic value and social value, every

effort should be made to develop business models that are innovative in diverse aspects

such as the production system and value chain. In particular, it is vital to come up with

innovative ideas to bring together society’s diverse assets and capabilities via networking

in order to overcome the unfavorable competitive environment.

Accordingly, support must be available to open websites and organize competitions that

are dedicated to launching and promoting social enterprises.

In that respect, the Ashoka Foundation’s ChangeMakers has significant implications.

ChangeMakers is an open source community that seeks solutions to the world’s most

pressing social problems. Social entrepreneurs worldwide can enter their ideas in

ChangeMakers competitions. All proposals are posted online and open to the community

so that participants can collaborate to find the best possible solutions.

② Start-Up Funds for Social Enterprises

Direct investment in a social enterprise related to a company’s value chain or business

portfolio or creating a start-up fund are possible options for strategic social contribution.

They should prove to be an effective means of implementing social responsibility from a

long-term perspective.

Moreover, greater corporate involvement is required in supporting social entrepreneurs.

For instance, overseas benchmarks could be adapted. Such examples include extending

financial assistance to selected social entrepreneurs with demonstrated capability (Skoll

Foundation of the US) and aiding individual social entrepreneurs (Unlimited of the UK).

③ Pro Bono Activities

Corporate personnel possess business expertise in areas that social entrepreneurs lack.

These areas include human resources management, finance, accounting, marketing and

legal affairs. Additionally, corporate volunteering initiatives could evolve to pro bono

activities in the form of management consulting for social enterprises. That, in turn,

would transfer knowhow in the corporate sector to social entrepreneurs and companies

could carry out more specialized volunteering activities.

④ Honing Capabilities of Social Entrepreneurs

Another important point to consider is enhancing the capabilities of social entrepreneurs.

In Korea, numerous academies that specialize in social entrepreneurship have recently

opened up, but most programs are short, consisting of just 60 to 80 hours. In contrast,

the US and UK offer two-year MBA programs that focus on social enterprises as well as

long-term programs that focus on fieldwork via the implementation of social enterprise

projects. Korea needs to set up educational organizations that nurture social

entrepreneurs. Moreover, corporate input would be valuable in opening courses

designed to enhance business knowhow and entrepreneurial spirit.

Meanwhile, companies should consider ways to support internal personnel with proven

business acumen and entrepreneurship who aspire to becoming social entrepreneurs.

Going forward, more people are expected to pursue a new career path as a social

entrepreneur after retirement. Along with financial assistance (eg, fellowship), companies

should develop in-house programs linked to retirement schemes that help retirees apply

their accumulated expertise for social entrepreneurship.

3. SK’s Support for Social Entrepreneurs

A. SK’s Corporate Philosophy and Social Enterprises

The ultimate objective of business activities carried out by SK is delivering “happiness.”

Under the SK Management System (SKMS), which serves as the basis of SK’s corporate

philosophy and culture, SK pursues values with the goal of contributing to stakeholders’

happiness through sustainable growth.

SK has carried out a wide variety of social contribution activities since the 1970s

including educational programs representing sponsoring a famous quiz show for high

school students and the Korea Foundation for Advanced Studies. In early 2000, SK

started to introduce programs for job creation under the motto of “teaching someone

how to fish instead of giving them fish.” Discussions soon ensued on the possible

conversion of the programs into social enterprises. In essence, SK started making

preparations related to social enterprises even before the Social Enterprise Promotion

Act was enacted in July 2007.

Since 2005, SK has donated start-up funds, assisted with start-up procedures and

provided consulting for a total of 52 social enterprises, namely the Happy Meal Box

centers. Thirty of them have been certified as social enterprises by the Ministry of Labor.

In 2009, SK announced a long-term plan designed to offer systematic support for

launching and promoting social enterprises. There are two key points to this plan. The

first is to create a social enterprise model that goes beyond the role of social service

provider to find innovative solutions to social problems. The second is to combine the

resources and capabilities of various constituents of society to foster a social enterprise

ecosystem.

B. SK’s Support Activities for Social Entrepreneurs

① Business Models based on Collective Brain Power & Start-Up Assistance

In November 2009, SK launched “Sesang” (www-se-sang.com), a collaboration network

that brings together the expertise of diverse sectors including the government, research

agencies, social enterprises and NGOs, in addition to members of the general public

interested in social entrepreneurship and social enterprises.

Sesang features a section where individuals and prospective social entrepreneurs can

submit a one-page description of their ideas or business plans. The views of netizens

and experts can be incorporated in the submitted proposals via discussion in online

communities and forums. This “collective brain power” contributes to turning ideas into

refined business models. The blending of diverse abilities from various corners of society

is intended to discover and promote business items that innovate social entrepreneurs

and society.

The process of using collective brain power to discover social entrepreneurs and

business items is linked to the “Social Enterprise Sesang Competition.” The winners

selected via the three-stage competition receive prize money and various support, which

includes joint formation of social enterprise, investment, loans for lease deposits and

equipment, SK Pro Bono management consulting, and joint marketing assistance with SK

R&C.

As of May 2010, there were 433 business items for social enterprises proposed via

Sesang. SK supports three businesses proposed via the 1st competition. One is a toy

recycling business under which used and slightly damaged toys are collected and subject

to eco-friendly touch-up before being sold at nationwide franchise stores. The second is

employing disabled workers to create digital contents. The third is a business that helps

blind persons find jobs as providers of massage services.

② Pro Bono Management Consulting

SK has been offering a management consulting program for social enterprises as a part

of pro bono volunteering by employees since 2008. In September 2009, the company

formally launched the “SK Pro Bono Management Consulting Volunteer Group.”

Seventeen SK Group affiliates are taking part in this volunteer initiative and about 200

employees are serving as pro bono consultants.

An example of the pro bono activity has to do with Orgdot, a budding social enterprise

that aspires to “ethical fashion.” Orgdot would have found it difficult to last for even

another six months before it received assistance from nine pro bono consultants from

SK. Over a period of six months, the consultants offered advice on market and financial

analysis, business selection and concentration, customer management and marketing. As

a result, Orgdot reached the breakeven point for the first time in its history in March

2010. Its revenues are expected to increase three-fold in 2010. From May 2010, players

of the SK Wyverns baseball team have been wearing eco-friendly uniforms made of

recycled PET bottles supplied by Orgdot. This represents a success story based on pro

bono marketing help from SK.

③ Discovering and Training Social Entrepreneurs

SK played a major role in the launch of Korea’s first academy specializing in training

social entrepreneurs in 2006. The academy has produced 168 graduates to date. SK also

supports social entrepreneurs’ overseas benchmarking. In 2009, the companied launched

the “Social Enterprise Start-Up Academy” which offers training to young people seeking

jobs and retirees.

Social entrepreneurs have access to 55 online courses in areas such as marketing, human

resources, organizational management, finance and accounting. They can also take

advantage of offline training sessions.

As explained earlier on, SK’s social enterprise website “Sesang” serves as a channel to

turn ideas suggested by prospective social entrepreneurs into business models. SK also

offers start-up funds to advance promising business items as part of its commitment to

discovering and fostering social entrepreneurs.

④ Social Enterprise Promotion Funds and Support Organization

At the end of 2009, SK set up the “Social Enterprise Division” under its welfare

organization, Happy Nanum Foundation. The division concentrates on assisting social

entrepreneurs and social enterprises with various forms of support measures.

In addition, SK made a decision to raise KRW50 billion to promote social enterprises and

has so far created a fund worth KRW10 billion.

4. Conclusion

Despite their short history and weak infrastructure, social enterprises in Korea have laid

initial roots based on cooperation among the government, civic groups, and businesses.

The corporate sector has the means to support social entrepreneurs in terms of business

knowhow, funds, assets, infrastructure, purchasing and pro bono activities. The

integration of corporate assets and abilities will contribute to driving balanced growth of

social and economic value and bolstering the social entrepreneurial spirit.

For this objective, it is needed for a greater number of companies to participate in the

transfer of corporate competencies.

How to identify and Support Social Entrepreneurs

3 June, 2010

C.S LeeCEO, Social Solidarity Bank

“Entrepreneurs, whether primarily commercial or “social” in orientation,

are cut from the same cloth. So it seems appropriate to highlight the essence of

entrepreneurial activity in general, and then distinguish those who are primarily driven

by value appropriation and from those primarily driven by social value

creation, keeping in mind that all entrepreneurs must do both – but in

each case, the emphasis is different” (Pamela Hartigan )

Social Entrepreneur is also an EntrepreneurProviding an innovative solution – New product, Service or ProcessDriven by social value, but also financial value is important for SocialEntrepreneur and Investors for the sustainability of Social EnterpriseMaybe even more difficult job than commercially oriented entrepreneurs,because “Social” mission is added to their job

2

History of Social Enterprise in Korea

1990s’ Late 1990s’ In 2000

• Community movement in poverty area

• Deepening social polarization and high unemployment rate due to financial crisis

• Legislation of National Basic Livelihood Security Act

• Establishment of Center for Community Self Support

• Reinforcing workfare/social investment policy

• Growing interest on social enterprise and pilot social enterprises established

2003~2007 2007 2008~

• Legislation of Social Enterprise Promotion Act

• Issuing certificate for social enterprise

• Government declared to establish 1,000 S.E. by 2012

- Number of S.E increased:289 S.E. certified(as of 12/2009)

- Awareness on S. E. has been expanded

3

IssuesNeed for improving the concept

and sustainability of Social Enterprise

Focused onjob creation and

social service for poor

Defined the concept of

Social Enterprise too narrowly

Rely on Government too

much ( Certification

System, Financial Subsidy)

Why did it happen?

NGO initiated Social Enterprise without “Entrepreneurship”Some Business participated, but more in “ as a part of Social Responsibility activities”Government and Public sectors stepped in before the market matured. The result was a mess in the concept and practice in Social Enterprise & Entrepreneurs

4

Social Entrepreneur Development Program in Korea

Ø NGO – Social Innovative Entrepreneur Academy (The Hope institute)Ø Business – SK’s training programØ University – Yonsei, Gyounwon UniversityØ Partnership between Government and NGOs – Social Entrepreneurship Academy

(Ministry of Labor and University/ NGO Institute)

Academy

Ø Partnership between Public and Private Sector - Social venture competition (2009)Ø NGOs – WT Foundation, SVCK, SIFE etc.Ø Business - SK ( Social Venture Contest by Se-Sang )

Social Venture Competition

Ø Partnership between NGO and Business – WT Foundation /SK Group

Overseas Training

Ø Nexters, SIFE, WISH….Study group in University

5

Ø Unclear Definition of Social Entrepreneur

Ø Development / Training vs. Identification / Supports

ØTraining provided more to SE practitioners than Social Entrepreneurs

-Too general and need to be focused

Ø Incomplete selection process: Need more focus on Entrepreneurship

Ø Lack of enough financial and management supports for Social

Entrepreneurs

6

Issues

Ashoka WayNew IdeaNew Idea

Ethical FiberEthical Fiber

CreativityCreativity

Entrepreneurial Quality

Entrepreneurial Quality

Social Impact of the New IdeaSocial Impact

of the New Idea

QualificationNomination

Ashka’s representatives rely on a robust nominator network in all sectors to source quality candidates.

First OpinionThis stage entails visits, reference checks, interviews

conducted by Ashoka’s local representatives.

Second OpinionA senior Ashoka staff person from outside the region Conducts in-depth three to eight hours interview with

each candidate covering both the candidate’s lifehistory and carefully probing the new idea.

PanelEach candidate spends one hours with each of 3 to

6 panelists, all of whom are leading local social entrepreneurs in the country. The panel is chaired by a

global board member or senior manager, and thepanelists discuss their impressions.

Panel decisions are by consensus-there is no voting.

Board ReviewAshoka’s international board, meeting monthly, reviews

each candidacy carefully and is the final sign off.

Selection Process

Supporting /IncubatingLiving stipend for an average of three years

Support global network of their peer and

partnerships with professional consultants

Allowing them to focus full-time on building

institutions and ideas

7

Lessons

Social Entrepreneur is different from Social Service Provider. The concept of Social Enterprise and Social Entrepreneur need to be clearly defined.

It may not be too much to say that entrepreneur is born in nature in general. So, it is important to identify the potential innovative Social Entrepreneurs and support them afterwards.

The identification process and support are needed to be reinforced

Networking is one of the essential parts of supports

8

Case-Social Solidarity Bank(Benchmarking Ashoka Foundation)

Not for Social Service Delivery, but Entrepreneur

Intensive Identification Process andIn-depth Supports for the selectedInnovative Social Entrepreneurs`

Networking afterwards Providing/Arranging Loan and Investment

Approx 2 years for identifying and support a social entrepreneur before an enterprise started

• Pilot projects- Identifying/ Supporting the innovative Social Entrepreneurs

- Mentoring, Consulting

• Launching successful model of the S.E- Investment/Loan- Incubating/Consulting

Phase 1. 2010~2011

Phase 2.2012

Phase 3. 2012~

• Expanding the cases

9

SSB

1 2

3 4

5

Entrepreneurs who are primarily driven by social value creation, however, are driven to

address market and/or government failures. They work where business

have failed to come up with innovative ways to design and deliver the goods and

services needed to address social, economic and environmental challenges because the

risks are too high in relation to the financial profits. Similarly, these are issues

governments have been unable or unwilling to tackle – because of financial,

political or bureaucratic constraints. These sorts of entrepreneurs – what we today call,

social entrepreneurs-are drawn to deal with such challenges, transforming

the systems and practices that have stood in the way of pragmatic,

equitable and sustainable solutions. (Pamela Hartigan)

10

Strategic Alliance to Identify and Support Social Entrepreneurs

•Legal & institutional infrastructures(tax-incentives and low cost

funds for NGOs)

Government

• Investment on Change Makers• Transfer Business Capacity & Resources to Social Entrepreneurs

• Collaborative work with NGOs

Business

• Identify the talented potential Social Entrepreneur

• Support Social Entrepreneurand run the business of developing social enterprises

NGO/University/Private Sector

Strategic Alliance

11

- 1 -

How to identify and support Social Entrepreneurs

Chong Soo Lee

Social Solidarity Bank

1. Preface

The deepening social polarization represents common problems in modern

capitalistic society. It is a task of every nation to solve the vulnerable and

(un)derserved structures in poverty, environment, health, education, community,

aging, children, etc. which occurred as a result of the social polarization.

Social Enterprises which try to overcome the limit of the traditional welfare system

in solving these social problems have received attention from the public in recent

decades since it provides longer and sustainable alternative solution.

Recently, due to the growth without employment, creating jobs became an critical

social issue in Korea and it is increasingly expected that social enterprise could be

good instrument to solve the problem, though history of social enterprise is not

that long in Korea. In 2000, the Center for Community Self Support was established

after Legislation of National Basic Livelihood Security Act in order to help

self-support conditional pensioner and initial form of social enterprise was born in

Korea by the Center for Community Self Support in an effort to assist the

conditional self support pensioner. And some large conglomerate companies joined

to establish social enterprises. In 2007, the Ministry of Labor announced the

Legislation of Social Enterprise Promotion Act and began to issue certification for

the selected social enterprises, and the public has become increasingly aware of

social enterprises. As of the end of 2009, the number of social enterprises certified

by the Ministry of Labor went up to 289. The current government made it as one

of the key tasks of State affairs to develop social enterprises and its objective is

to expand the number of social enterprises up to 1,000 by 2012. And many local

governments including the City of Seoul also participated in this project by setting

up target number of social enterprises. In short, establishing social enterprises in

Korea have mainly been initiated by the governments and public sector.

This has improved the recognition of social enterprises by the public and its

number has significantly increased, but on the other hand it has left several issues

to solve. Social enterprises in Korea must overcome the following limitations:

1) Since the establishment of social enterprises have been initiated by the

governments, their business activities were focused on job creation and social

- 2 -

services for the poor.

2) The Social Enterprise Promotion Act has narrow the definition of social

enterprise, thereby limiting the otherwise broader activities of social enterprises.

3) Too much rely on the government funds and short term oriented government

policy. The social enterprises certified by the Ministry of Labor rely too much on

short term government funding, thereby limiting their ability to grow longer term.

The goal of social enterprise is to create social value by supporting various

vulnerable and (un)derserved social sectors and at the same achieves economically

sustainable business model. In order for social enterprise to achieve these two

objectives at the same time, it must be innovative and creative. Among those key

factors such as funding, market creation legal infrastructure, business item for the

successful social enterprise, people, right social entrepreneur consist of the most

important component, because all of those will be designed and created by social

entrepreneurs.

In this paper, we will talk about the way to identify and support social

entrepreneur, benchmarking Ashoka Foundation's program, the most successful one

in recent decades.

2. Who is social entrepreneur?

1) Definition

To run a business enterprise, funding, technology and business item are required

and it is the entrepreneur who will put these things together and produce the

results. Therefore, in order to develop a successful social enterprise, we need to

find the right social entrepreneur with innovative ideas and support them until a

successful and sustainable social enterprise firmly established. Social entrepreneur

creates social values for our community to grow and has innovative ideas as well

as strong will to implement them. They are innovative entrepreneur who wants to

improve the social problems.

Bill Drayton who had established Ashoka Foundation said, "Social entrepreneurs are

not content just to give a fish or teach how to fish. They will not rest until they

have revolutionized the fishing industry" He had also added. "A Social Entrepreneur

is not just a dreamer but an activist who endeavors to make a dream come true.

One of the most important requirements to them is a strong will to continue such

effort since it would probably take several tens of years if not longer for a Social

Enterprise to be established successfully and, further more, contribute to change

our society. Therefore, they must be a passionate person not to give up even

- 3 -

though the results do not dome out in a short period of time. Also important is that

he must possess a high degree of sincerity and honesty." Social entrepreneur will

be a reasonable monomania who are devoted to solving fundamental social problems

with new and innovative ideas.

2) Social Entrepreneurs

◯ Muhammad Yunus

Professor Muhammad Yunus established the Grameen Bank in Bangladesh in 1983,

fueled by the belief that credit is a fundamental human right. His objective was to

help poor people escape from poverty by providing loans on terms suitable to them

and by teaching them a few sound financial principles so they could help

themselves. From Dr. Yunus' personal loan of small amounts of money to destitute

basketweavers in Bangladesh in the mid-70s, the Grameen Bank has advanced to

the forefront of a burgeoning world movement toward eradicating poverty through

micro-lending. Replication of the Grameen Bank model operates in more than 100

countries worldwide.

Dr. Yunus and the Grameen bank were jointly awarded the Nobel peace prize in

2006, "for their efforts to create economic and social development from below."

◯ Mary Gordon(Ashoka fellow electee in 2002)

Mary Gordon's program, Roots of Empathy, works to reduce childhood aggression

by teaching students emotional literacy and fostering the development of empathy.

In 1996, she founded Roots of Empathy, which now offers programs in Canada,

New Zealand, the United States. Gordon is also the founder of Canada's first and

largest school-based Parenting and Family Literacy Centres, which she initiated in

1981. They have become public policy in Ontario, with more than 120 schools

involved for Fall 2008. They have been used as a best practice model

internationally. Gordon was the first female Canadian Ashoka Fellow, recognizing

her as a member of an international circle of social entrepreneurs who have the

creativity that enables them to envision new and better ways to address persistent

social problems and the entrepreneurial skill and determination required to bring

their ideas to fruition. She is a member of the Executive Board of Directors of the

Ashoka Foundation.

◯ John Wood

John Wood is the founder and board chair of Room to Read. He started Room to

Read after a fast-paced and distinguished career with Microsoft from 1991 to 1999.

- 4 -

Room to Read partners with local communities throughout the developing world to

provide quality educational opportunities by establishing libraries, creating local

language children's literature, constructing schools, and providing education to girls.

Room to Read's mission is to provide under-privileged children with an opportunity

to gain the lifelong gift of education. It was founded on the belief that education is

crucial to breaking the cycle of poverty and taking control of one's life. It currently

focuses its efforts on Bangladesh, Cambodia, Laos, Nepal, India, Sri Lanka, Vietnam,

South Africa, and Zambia; countries with a desperate lack of resources to educate

their children.

◯ Fabio Rosa(Ashoka fellow electee in 1989)

Fabio Rosa has been working to bring energy and community development to

impoverished rural areas. Fabio's "Project Light" succeeded in its very first attempt

to raise the lining standards of low-income rural families by taking cheap electricity

to their homes and farms. Millions of rural residents have no electricity,

refrigeration, indoor plumbing, water pumps for irrigation, or other common

household and farm electric appliances. Fabio's pilot project from 1984 to 1988

changed that situation for 400 rural families in Palmares. Not only did low-cost

electrification stop the flow of residents to cities, it reversed the flow.

◯ Erzsébet Szekeres(Ashoka fellow electee in 1997)

Erzsébet Szekeres has created a nationwide program for training, employing and

housing disabled adults. As a result of her efforts, her hometown has become a

principle locus of activity for the disabled in Hungary.

Erzsébet Szekeres has developed a program to address three of the most difficult

problems that disabled adults face in Hungary - a lack of job training, few

employment opportunities, and a housing shortage. During her own experience of

trying to provide the best possible care for her disabled son, Tibor, Erzsébet

quickly realized that the only way the fate of the disabled in Hungary would

improve would be for them and their families to organize and begin to replace the

state's inadequate services. She contributed to establish Csomor community for

disabled adults.

◯ Martin Fisher

Fisher has applied his passion for improving things to the challenge of eliminating

poverty in rural Africa. In collaboration with co-workers, he has invented low-cost,

human-powered irrigation pumps and other simple moneymaking tools, coupled with

a sustainable and replicable supply-chain model that enables subsistence farmers to

- 5 -

use the equipment to become self-reliant entrepreneurs. This process is

transforming the lives of hundreds of thousands of poor Africans by enabling them

to double or triple their annual net family incomes.

3) Characteristics of leading social entrepreneur1)

◯ A New Idea

Social Entrepreneur is the one who possess a truly new idea that is a truly

transformational innovation, or just a tweaking of how things are now done. The

new idea is a solution to a social problem that will change the pattern in a field at

the regional or national level.

◯ Creativity

Social Entrepreneur should be creative-both in vision/goal setting and in problem

solving. Successful social entrepreneurs must be creative not only in goal-setting

but also in solving the problems that inevitably arise while pursuing their vision.

They must use their creativity day after day in order to succeed.

◯ Entrepreneurial Quality

Social Entrepreneur does not rest until his or her vision is the new pattern across

society, even if it involves years of grappling with "how to" issues? They are the

people who are married to their idea and will keep developing it if need be for

decades. Social entrepreneurs are practical and pragmatic. They know how to

overcome obstacles, and are driven both by their idea and by the will to make that

idea an institutionalized reality.

◯ ·Social Impact of the Idea

The idea should be new, practical, and useful enough that others will adopt it once

it has been demonstrated. It is important to figure out how many people will be

affected by this idea, to what degree, and how beneficially. The idea will over the

long term, change the social needs significantly and will trigger widespread social

impact. Social entrepreneurship not only needs an extraordinary person to develop

an idea but also a powerful, practical idea that will spread on its own merits.

◯ Ethical Fiber

Social Entrepreneurs introduce major structural changes to society and ask a great

many people to change the way they are used to do things. If people do not trust

the entrepreneurs, the likelihood of success is significantly reduced.

3.Ashoka Program

1) Ashoka Foudation(2008), Ashoka's Venture Fund for Leading Social Entrepreneurs Prospectus.

- 6 -

1) Brief introduction about Ashoka foundation

It is not too much to say that social entrepreneur is not raised by education or

training but born in nature as a social entrepreneur. Therefore, the most important

thing is to identify someone with potential to become social entrepreneur and

support continuously as evidenced by Ashoka's experience.

Ashoka was founded by Bill Drayton and 2,800 social entrepreneurs were elected

as Ashoka fellow in 70 countries since the first fellow, Gloria de Souza, was

elected in 1981 in India. The most important thing to make the world better is to

identify and support social innovators who has innovative ideas and passion. That

is, elect idea champions and invest on them as well as their social enterprises.

2) Ashoka's selection process2)

Ashoka's selection process is described as following five stages.

◯·Nomination

Ashoka's representatives rely on a robust nominator network in all sectors to

source quality candidates.

◯ First opinion

This stage entails site visits, reference checks, interviews conducted by Ashoka's

local representative.

◯ Second opinion

A senior Ashoka staff person from outside the region conducts in-depth three to

eight hour interviews with each candidate covering both the candidate's life history

and carefully probing the new idea.

◯ Panel

Each candidate spends one hour with each of 3 to 6 panelists, all of whom are

leading local social entrepreneurs in the country. The panel is chaired by a global

board member or senior manager, and the panelists discuss their impressions. Panel

decisions are by consensus-there is no voting.

·◯ Board review

Ashoka's international board, meeting monthly, reviews each candidacy carefully and

is the final sign off.

2) Ashoka Foudation(2008), Selecting leading social entrepreneurs

- 7 -

3) Asoka's support program

Ashoka helps these social entrepreneurs launch their visions and their careers. It

provides the framework and supports that enable them to find and help one another

and to articulate and share their professions' methodologies, especially the most

effective approaches to bringing about structural social change. Even more

importantly, Ashoka's network enables them to collaborate in attacking common

problems where no single entrepreneur can be as effective alone. Ashoka's job, in

other words, is to provide key institutional support for the field of social

entrepreneurship and its leading practitioners.

4. Social Entrepreneur developing programs in Korea

1) Current programs

After the Ministry of Labor announced the Legislation of Social Enterprise

Promotion Act and began to certify social enterprises in Korea in 2007, Social

Entrepreneurship Academy Course established and run under partnership between

some reputable universities and NGOs to raise social entrepreneurs for developing

social enterprises. SoongSil University was the first one which opened Social

Entrepreneur Academy Course in 2007, followed by many reputable universities

such as Busan University, Chonnam University, SungKongHoe University and KAIST.

KyungWon University is running a special graduate course for majoring social

enterprise. In order to develop new ideas for various types of social enterprises,

several social venture competitions have been run in various sectors. The key

players are the Ministry of Labor, universities and business enterprises.

Besides, university students who are interested social enterprises have organized

their own study groups Nexters, WISH, SIFE, etc. and these activities helped

produce various ideas for social enterprises and develop social entrepreneurs.

2) Issues

There have been a number of programs for developing social entrepreneurs in

Korea, but some limitations are seen in identifying and supporting innovative social

entrepreneurs who can start and run sustainable social enterprises as follows

1. Target

Most programs are so general, in selecting trainees and candidates, mainly for

university students or staff working for social enterprises. They are designed

for social service provider or working staff rather than "Entrepreneur". The

program need to be focussed on the entrepreneurship for potential social

- 8 -

entrepreneurs.

2. In-depth selection process

Many of them are short term or one off seminar and training. The focus

should be given to identifying potential entrepreneurs and supporting them

afterwards. The entrepreneurship cannot be formed in a short term.

3. Full Supports

Establishing an enterprise is not an easy task. It needs a lot of preparation

work, test and experience before a company run successfully. Social enterprise

may be even more difficult because it contains one more concept "Social",

compared with normal corporation. Therefore once we identify the right one,

it is necessary to provide them with the full supports for some time until they

make their vision realized and the social enterprise become sustainable.

3) How to develop social entrepreneur in Korea

We need to introduce a program like Ashoka Program to find and support potential

social entrepreneurs for developing sustainable social enterprises in Korea.

We need to find social entrepreneurs who can change our society better in

innovative ways and the process will be strict and careful. We may find only a few

at the beginning but we must move on. Selecting process must be participated by

experts and professionals from universities, business sectors and social enterprises.

It is necessary to provide stipends and office for the selected social entrepreneurs

to implement their ideas and scaling their business plans during the incubating

period. During the incubating period, each selected social entrepreneur will have a

group of advisors, business consultants and professionals who will provide

mentoring service for setting up a successful and sustainable social enterprises.

After the business plan is completed, the required funding will be arranged through

social venture fund and necessary consulting and management support will continue.

In order to prepare and run all of the above mentioned programs, the role of NGOs

with special expertise in social enterprises is critically important. Business sectors

and public sectors need to work together with such capable NGOs to find and

support innovative social entrepreneurs.

Case - Social Solidarity Bank

The Social Solidarity Bank(SSB), known as the largest microcredit institution in

Korea, has been very active in developing a program to identify and support the

potential social entrepreneurs in Korea. While the most programs in Korea are

focussed on the training for the generalist in Social enterprise, SSB's program put

emphasis on "entrepreneurship" in social enterprise as well as social aspects,

- 9 -

because it sees that social enterprise should be 'sustainable' like other companies.

Benchmarking Ashoka's program, SSB designed an intensive social entrepreneur

development program to identify and support the potential social entrepreneurs. It

includes the strict selection process, supporting package such as stipends, business

consulting and mentoring by professionals, and providing loan and investment and

networking. The whole process will take approx two years.

5.Conclusion

Social enterprise creates social values and at the same time persue economically

sustainable innovation. Social enterprise requires innovative ideas of entrepreneur

and sustainable social enterprise must have social entrepreneur with passion and

innovative ideas. As we saw in the case of Ashoka, identifying social entrepreneur

with passion and innovative ideas and supporting them is the most important thing

to change the world better.

Social enterprise in Korea needs to develop sustainable business model. For this,

we need to find the potential social entrepreneur and support them for their

business success. We need to make long-term investment on the selected potential

social entrepreneur and we also need to establish the fellow networks that function

as the leverage to create successful and sustainable social enterprise as well as

level up the status of social enterprise in Korea.

Social Entrepreneurs are the key to the successful social enterprise. It is believed

that the business sector has very useful tools in this. As business enterprises

change their strategy of social contribution projects, many reputable business

enterprises began to participate in establishing and supporting social enterprises.

The types of supporting social enterprise are (1) establishing social enterprise

directly, (2) establishing social enterprise by making partnership with NGO, (3)

supporting social enterprise established by NGO, not only existing social enterprises

but also participate in projects for developing innovative social entrepreneurs.

The program under which business enterprise provides financial support for social

enterprise and purchase the products of social enterprise has a limitation in

securing the sustainability of social enterprise. To develop sustainable social

enterprises, business sectors must support not only existing social enterprises but

also participate in projects for identifying and supporting innovative social

entrepreneurs. Business can collaborate with NGOs which has enough experiences

to achieve the goal. Government can provide legal and institutional infrastructures

and business enterprise provides financial support while NGO identify the talented

potential social entrepreneur, support them and run the business of developing

social enterprises. In this way, successful and sustainable social enterprises will be

firmly established and our society will become a better place.

Korea Foundation for Social InvestmentKim You Sook

Social Entrepreneurs to Flourish in the Field

2008 2009 2010

2008~2009

Microcredit Expert Training

2008

Prospective Social

Entrepreneurs Incubating

2009 ~ present

Creating Social Economy Together

Case Analysis by Training Course

Microcredit Expert Training (2008)

self-help activity

39%

Company, management

, finance

17%

MC institution, foundation,

non-profit organization

31%

Social enterprise, community

10%

others

3%

Field distribution of course graduates

Construction trainees

highschool graduate

8%

college student

4%

college graduate

65%

master’s/doctorate

degree23%

Education distribution of class attendants


Course TargetNumber of

class

CEO (chief executive officer) Prospetive CEO or business owner of microcredit institution 1

BRM (Business Relationship Manager) MC working-level staff and follow-up management expert 4

LRM (Local Relationship Manager)Working-level staff at community fields that support MC staff invol

ved2

MRM (Manager Relationship Manager)Professional consultants from each subject area and group of expert

s with professional expertise who support MC working-level staffs3

Retired professionalsGroup of retirees from companies or financial institutions who wish

to contribute their expertise to the society1

Curriculum: 5 courses/ 11 classes (15~30 people per class)

Directly engaged in MC Indirectly engaged in M

C Not engaged in MC Total

Affiliation not changed after

and before the courseAffiliation changed

- Supportive role at relev

ant organizations

- Lecture & consulting, e

tc.

- Waiting or hoping to en

gage in MC

- Hoping to engage in vo

luntary service, etc.

46 persons 7 persons

53 persons (26.63%) 104 persons (52.26%) 42 persons (21.11%)199 persons (1

00%)

Follow-up research on course graduates’ engagement in Microcredit business

Analysis of course graduates’ activities (As of May 2009)


Prospective Social Entrepreneurs incubating

Business overviewContents

When Stage

Jun.

~ Oct. 2008

Preparation․Preparation of resource & network for business startup incubating

․Organize steering committee for business support

Select course attendant

s & business items

․Publicly recruit and select course attendants

․Review and determine business items

Nov.

~ Feb.

2009

Incubating

․Start-u

p prepa

ration

Correct&supplement busine

ss plan▶ Engage business management expert

Review budget & organizat

ion▶

Engage and connect experts & relevant organiza

tions

Briefing session of business

plan▶ CSR companies, employment agencies,

Provide office ▶Provide incubating space at the Foundation’s bu

ilding

․CourseGeneral course ▶ 30 hours

Customized course ▶ 15 hours

․Mento

ring

Select and connect mentors

by subject area▶

Business managers, management consultants an

d social-economy experts in active service

․Financ

ial sup

port

Personal preparation for bu

siness start-up▶

Provide a monthly support of 800,000 KRW per

person

Creating social economy together (2009 ~ present)

Type of project Contents

1) Capacity building of social-economy a

ctivists

- Capacity building focused on workshops and action learning

․Understanding social economy ․Establishing and running social enterprises

․Methodology of social accounting & community research

․Professional training by region and area

2) Establishing business strategy for socia

l economy

- Establishing policy and implementing pilot project

․Researching and analyzing community needs and circumstances.

․Evaluating and giving outlook on community project: establish policy and implement pi

lot project

․Developing regional model for social-economy organization: apply social accounting

․Raising community awareness on social economy

3) Building network of social-economy m

ovement

․Build blocs connecting social-economy activities within community

․Seek ways to promote cooperation among social-economy networks across the country

4) Strategy to mobilize resource and raise

funds to promote social economy

․Establish community-based organization that supports social economy

․Organize community fund partnership

․Collective reaction to mobilize social contribution fund and policy fund

5) Establish and propose policy to suppor

t social economyResearch on measures to support the promotion of social economy in local communities

The Korea Foundation of Social Investment (relevant experts & advisors)

Strengthen the capacities

of activist in service

Discover and create regional model for the social

economy in local communities

Establish strategy for social-

economy projectBuild social-economy bloc

• Focus on workshop & action-

learning

• Understand social economy

• Establish and run social

enterprise(community)

• Building partnership among local

communities

• Establish policy and implement pilot

project

• Evaluate and give outlook on

community project: indentify consulting

needs

•Develop regional model for social-

economy organization and raise

community awareness on social

economy

• Establish strategy to mobilize

resource and raise funds to promote

social economy

• Buildi network of social-economy

movement

• Seek measures to promote

cooperation among social-economy

networks across the country

• Explore local community funds and

strengthen solidarity

• Explore measures to support the

promotion of social economy in local

community


Conduct

community

-based

acitivities

Evaluate and

build common understanding

Conduct

reality check

Establish

business plan

Carry out

activities

Achieve goalSupport &

Encourage

ment

Korea Foundation of Social investment

(relevant experts & advisors)

Training/ workshop

Advisory/ consulting

Information provision

Monitoring

Working-

level

staffs on

sites

Execution result

Strengthen the capacity of activists in service through action learning

- problem-solving, creativity, culture of debate, communication and sense of ownership

- Conflict management, democratic leadership, teamwork, improvement of learning ability

Social enterprises become the center of socio-economic activies, meeting the

social needs of the community


Distinctive features of the training course

Course name Purpose Target Feature Result

Microcredit

Expert Training

To promote microcred

it business

Prospective CEO or

working-level staffs

of microcredit institu

tion

Supply of working

-level staffs for sp

ecific types of proj

ects nationwide

Supply of workforce to r

espond to MC project ex

pansion in 2009

Social

Entrepreneurs

Incubating

To carry out intensive

training of prospectiv

e social entrepreneurs

Prospective social en

trepreneurs with idea

s to achieve social p

urpose

Training of a few s

elected elites

Cultivate experts to supp

ort establishment and bu

siness of social enterpris

es

Creating

Social Economy

Together

To build localization

model of social econo

moy

Community activists

who aim to realize s

ocial economy

Capacity building

of activists based

on community and

project through

Action Learning

Overall capacity building

of community activists i

n social economy and im

mediate reflection of the

result in projects

Social Entrepreneurs to Flourish in the Field

Korea Foundation for Social Investment Kim You Sook

Ⅰ. IntroductionWhen laws and regulations concerning social enterprise were enacted in Korea, a wide range of considerations were made as to the supporting system, organization and infrastructure, but not so much as to the ‘people’ who are responsible for carrying out ‘the challenging task.’ Rather, we painted a rosy picture that social entrepreneurs would somehow solve all the problems caused by market and state failure, turning a blind eye to the actual reality. However, there was relatively insufficient consideration of the ‘people’ who actually make that dream come true. In reality, there aren’t any learning or developing processes for social entrepreneurs who try to solve social issues that are outside the market’s interest and not easily accessible by the state. Clearly, social entrepreneurs have something special that others don’t have. They are not motivated by profit. They dream of changing the society before they think of personal interest. They constantly try to figure out what they can do for the underserved class of our society.

So, what makes social entrepreneurs different?1)

Social entrepreneurs are different from other ordinary business managers on multiple levels. They run business with social purposes in mind. Their primary purpose is to make the world a better place. Another important thing that makes them different is that they do not get the same feedback from the market as business managers do in general. Companies that create value efficiently for their customers are rewarded in the long term. In other words, they get rewarded when profit returns to the investors. However, social entrepreneurs that create social value are, in many cases, not fully guaranteed with the feedback on their activities. Therefore, the best way to measure social entrepreneurs’ success is to examine how much social value they create, rather than how much profit they make. The following describes how social entrepreneurs are making changes in our society. 1) Accept the purpose of creating and maintaining social value: The mission of improving the

society is vital to social entrepreneurs. This is a greater priority for them than creating profit. Instead of promoting rapid changes of the society, social entrepreneurs seek ways to achieve gradual improvement.

1) J.Gregory Dees. Enterprising Nonprofits: A toolkit for Social Entrepreneurs. 2002

2) Recognize and constantly promote new opportunities to accomplish the mission When others look at problems, entrepreneurs look for opportunities. Social entrepreneurs have the

vision of accomplishing their purposes and strive to realize the vision. 3) Focus on continuous innovation, adjustment and learning process: Social entrepreneurs seek

innovative ways to raise funds to create social value, mobilize resources and create values that can last as long as possible.

4) Treat existing resources boldly without limitation: social entrepreneurs have the ability to carry out activities and mobilize resources from outside with the insufficient resources they have. They explore all available resources, from engaging in strictly voluntary activities to profit-making businesses without any conceptual or traditional limitations.

5) Exercise high level of responsibility towards the customer and consequences: Social entrepreneurs pass through steps that reveal their value-creating performance. They try to deliver substantive social improvement to the customers and communities and at the same time, strive to provide attractive social and financial results to the stakeholders.

Therefore, trainings for these social entrepreneurs cannot be same as trainings for CEOs or MBA programs. Social entrepreneurs should be continuously provided with the time and space to contemplate, from a realistic perspective, on how to specifically express and carry out their value and faith. However, such training courses will not be developed and take root in our society overnight. Because social enterprise suddenly arose as a social issue in our society, there wasn’t enough time to try out different ‘training courses for social entrepreneurs’ to find out what best suits the Korean society. Since its establishment, the Foundation had much, although not enough, interest in the training course for working-level staffs and activists in the ‘social economy.2)’ The following introduces the training courses that the Foundation has provided during the past few years and accordingly suggests the future direction.

2) Social economy refers to a third sector in economies between the private sector and business or, the public sector and government. It includes organisations such as cooperatives, social enterprise, non-governmental organisations and charities.

2008 2009 2010

2008~2009Microcredit Expert Training

2008Prospective Social Entrepreneurs Incubating

2009 ~ presentCreating Social Economy Together

Ⅱ. Case Analysis by Training Course

The Korea Foundation for Social Investment has been carrying out several training projects to strengthen the capacities of working-level staffs in the social economy and to train social entrepreneurs. This paper breaks down the training into three different courses in chronological order and explains the distinctive features of each course and how they are run. First is ‘Training for prospective owner and working-level staff of microcredit enterprise’ that financially supports credit delinquents and low-income class who want to become financially independent. The training has been ongoing for eight months across the country and has produced approximately 200 microcredit entrepreneurs and working-level staffs. Second is the ‘Prospective Social Entrepreneurs Incubating’ that discovers potential social entrepreneurs who aim to achieve social needs and purposes and provides them with customized training to grow into social entrepreneurs. The third course is ‘Creating Social Economy Together.’ This training aims to strengthen the skills and capacities of working-level staffs at nonprofit organizations and social entrepreneurs working in social economy through community and field-based ‘Action Learning.’

1. Microcredit Expert Training (2008)1) Overview ○ Period: July 2008 ~ February 2009 (8 months) ○ Context and purpose of the training The purpose is to cultivate social entrepreneurs who can expand microcredit business that supports

economic activities of the working poor and to build up expertise of prospective working-level staffs at microcredit institutions.

○ Execution: Consortium of 4 institutions - Execution: Korea Foundation for Social Investment, Social Solidarity Bank, Joyful Union, Korea

Startup Education Association

self-help activity

39%

Company, management

, finance17%

MC institution, foundation, non-profit

organization31%

Social enterprise, community

10%

others

3%

Field distribution of course graduates

highschool graduate

8%

college student

4%

college graduate

65%

master’s/doctorate

degree23%

Education distribution of class attendants

- Partner community organizations · Busan (Executive Committee on Building Social Entrepreneurs Hub In Busan), Gwangju,

Jeonnam (Honam Training Center for Nursing and Home Care Service) · Gangwon (The Anglican Wonju Na-nu-me-jib), Jeonbuk (Jeonbuk Network for Social

Enterpreneurs) ․ Group of retired professionals (The Hope Institute) ○ Course attendants - Target: ․ Prospective business owner who plans to establish microcredit institution ․ Prospective working-level staff who wishes to work at microcredit institution. ․ Community activists and professional consultants who wish to promote microcredit business. ․ Retirees from financial institutions or companies who wish to participate in microcredit

business. - Completion of course: Submission of 2 assignments and over 70% of class attendance are

required. ․ 199 people completed the course. (99.5% of a total of 220 people)

Course Target Number of class

CEO (chief executive officer) Prospetive CEO or business owner of microcredit institution 1

BRM (Business Relationship Manager) MC working-level staff and follow-up management expert 4

LRM (Local Relationship Manager) Working-level staff at community fields that support MC staff involved

2

MRM (Manager Relationship Manager)Professional consultants from each subject area and group of experts with professional expertise who support MC working-level staffs

3

Retired professionals Group of retirees from companies or financial institutions who wish to contribute their expertise to the society 1

2) Curriculum: 5 courses/ 11 classes (15~30 people per class)

3) Distinctive features of the course ○ Focus on on-the-job training: While general course (basic) focuses on theories, professional, advanced and practice training

courses focus on building up practical business skills through hands-on experience except for ( ) ○ Diverse set of monitoring systems are conducted throughout the tutoring system and courses to

provide customized and intimate education and to reflect the monitoring result in the curriculum.

4) Course stage & curriculum ○ Course stage: Basic ⇨ Professional ⇨ Hands-on experience ⇨ Practice training - Regular course 212 hours + Practice training 70 hours - Stage 1 (Basic: 67 hours), Stage 2 (Professional: 67 hours), Stage 3 (Hands-on: 78 hours) Stage

4 (field training: 70 hours)

Stage Hour Subject Contents

Basic Genera l c l a s s for 4 courses

12 Value/PhilosophyOrientation / Pre-evaluation / Understanding MC & its history/ Korean case of MC / Understanding the financially underserved class / MC finance system

16 Character/ Basic knowledge

Communication / counseling skill / Vision setup of MC professionals / Self development

18 Understanding industry

Agriculture and livestock / Manufacturing / Service / Wholesale and retail / Restaurant business / Understanding venture / Understanding trade / Understanding franchise/ Understanding social entrepreneurship

10 Understanding value chain

HR organization management / Production management / Finance management / Business strategy

11 Workshop 1Special lecture 1(laugh)/Makeup course 1(Informatization management)/Assignment instruction 1(Vision setup)/ OJT & get-together

Professional

Genera l c l a s s for 4 courses

32Consulting Method &

Tool

Role and quality of consultant/ Framework for financial management analysis / Problem-solving / Framework for non-financial management analysis/ Understanding consulting process / Data research & simulation / Writing reports / Practical presentation

Individual c l a s s for 4 courses

24

CEOPractical business environment analysis/ Practical business strategy setup / Predicting business result / Practical financing of MC institution / Practical MC institution organization operatio / Practical MC institution finance management

BRMBusiness district analysis & contract / Practical bond & financial management / Practical analysis of sales performanc / Practical worksite, customer, HR / Practical analysis of customer, purchasing pattern and sales promotion / Practical business promotion measures

LRMIntroduction of MC localization strategy / Practical MC localization analysis / Practice setting up MC localization strategy / Analyzing MC social results / MC localization taskforce / Writing MC business proposal

MRMPractical business consulting diagnosis stage / Practical business consulting involvement stage/ Business consulting analysis / Business consulting execution / Creating teaching method & teaching plan / Business consulting simulation

General 11 Workshop 2 Special lecture 2(health) / Makeup course 2(CSR) / Assignment instruction 2(research assignment) / OJT & night of get-together

Hands - o n Experience

Genera l c l a s s for 4 courses

8 Preparation for hands-on training Preparation for hands-on training (time, company, etc.)

32 Field Instruction Field instruction (company visits, hands-on experience, etc.)

11 Workshop 3 Special lecture 3(healthcare policy)/ Makeup course 3/Assignment Instruction 3(research assignment)/ OJT & night of get-together

Individual c l a s s for 4 courses

16

Wrap-up of hands-

on experience stage

CEO Practical writing, presentation, evaluation and feedback of business plan

BRM Practical writing, presentation, evaluation and feedback of supervising report LRM Writing, presentation, evaluation and feedback of business proposal

MRM Writing, presentation, evaluation and feedback of business management consulting report

General 11 Workshop 4Special lecture 4(domestic & international social-economy trend) / follow-up evaluation / Announce and award best assignment / Night of get-together

Practi c e Training

General 30 Understanding target & participant Understanding sites by area and type

40 OJT training Deliberation~ Payment ~ Follow-up management R e t i r e d professionals

54Understanding MC and the actual work

History and philosophy of MC / Understanding relevant systems / Understanding communities, small business owners and social entrepreneurs / Working-level meeting with MC business institutions

○ Course curriculum

Directly engaged in MC3) Indirectly engaged in MC Not engaged in MC Total

Affiliation not changed after and before the course

Affiliation changed

- Supportive role at relevant organizations- Lecture & consulting, etc.

- Waiting or hoping to engage in MC - Hoping to engage in voluntary service, etc.

46 persons 7 persons

53 persons (26.63%) 104 persons (52.26%) 42 persons (21.11%) 199 persons (100%)

4) Follow-up research on course graduates’ engagement in Microcredit business ○ Analysis of course graduates’ activities (As of May 2009)

○ Graduates directly engaged in microcredit business - Doo-rae-il-koon, Social Solidarity Bank, Beautiful Foundation and Women’s Foundation of the

Joyful Union have been affiliated with relevant microcredit institutions before the start of the training, taking part in the capacity building of the employees.

-. There are also many course graduates who were newly employed after completing the MC training or started microcredit business.

○ Graduates indirectly engaged in MC business - Experts who work in specialized areas but provide consulting and lecture as microcredit

advisors or consultants through self-sufficiency center, solidarity bank, Joyful Union, etc. - 34 people who completed the course have been entrusted with microcredit business

(Hee-mang-kee-woom bank) in 2009 in Jeolabukdo and Jeolanamdo and are expected to be fully engaged starting this year. (61 people)

- 13 people are working at social enterprises or self-sufficiency communities. - 9 people are working as working-level staffs at non-profit civil organizations that support

low-income class who wishes to start business. ○ Analysis of course graduates who are not engaged in microcredit business are as follows: - 50% of these graduates have great desire to engage in microcredit business. Especially, those

who completed the retired professional course are showing strong desire for additional training and activities.

- The rest are working at companies or institutions not involved in microcredit business.

3) MC. is an abbreviation for microcredit

Business overview Contents When Stage

Jun.

~ Oct. 2008

Preparation ․Preparation of resource & network for business startup incubating ․Organize steering committee for business support

Select course attendants &

business items ․Publicly recruit and select course attendants ․Review and determine business items

Nov.~

Feb.2009

Incubating

․Start-up preparation

Correct&supplement business plan ▶ Engage business management expert

Review budget & organization ▶ Engage and connect experts &

relevant organizations Briefing session of business plan ▶ CSR companies, employment agencies,

Provide office ▶ Provide incubating space at the Foundation’s building

․Course General course ▶ 30 hours Customized course ▶ 15 hours

․Mentoring Select and connect mentors by subject area

▶ Business managers, management consultants and social-economy experts in active service

․Financial support

P e r s o n a l preparation for business start-up

▶ Provide a monthly support of 800,000 KRW per person

2. Prospective Social Entrepreneurs Incubating (2008)

1) Course Overview ○ Purpose: To discover prospective social entrepreneurs with potential ideas (items) for social

enterprise and to support them in establishing social enterprise through customized training and infrastructure.

○ Period: October 2008 ~ February 2009 (5 months) ○ Target: Prospective social entrepreneurs - Selectees & business item: 4 persons in total ․A: Establish social enterprise that discovers, supports and sponsors creative cultural artists in pure art. ․B: Supply passive houses and improve residential environment for low-income class. ․C: Collect, repair and send abandoned bicycles to people in need and Koreans in North Korea

and abroad. ․D: Start accessories trade business by providing trade education to adolecents from low-income

families. 2) Training method & features ․ ○ Select a few prospective social entrepreneurs and provide customized training by individual and

item so as to get them focused on early start-up of business. ○ Provide mentoring to strengthen course attendants’ weak points. ○ Provide funding for incubating course, such as cost for activities and offices

Session 1 Understanding social enterprise

Session 2 Governmental support of social enterprise

Session 3 Understanding company (organization), organizational management of human resource and labor

Session 4 Tax accounting for business start-up / financial management

Session 5 Practice training of organizational purpose and vision

Session 6 Comprehensive understanding of marketing / Practice writing business plans

Session 7 Practice examining business feasibility, writing documents and business plans

Session 8 Make presentation of course results and individual business plans

AUnderstanding social economy, understanding microcredit, local foundation and fundraising, culture policy and Korea Artist Mutual Aid Association, Network, EconomyLocal Community Communication Toolkit

D Practical trade, practical business start-up, practical tax accounting, course execution, practical program development, etc.

A 1 expert in social economy, social enterprise

B 1 community development expert (eco-peace)C 1 business start-up consultantD 1 expert in adolescent self-sufficiency

A

- Running ‘Oh-eeh house’ that support cultural artists- Working as marketing experts in community business - Currently trying to incorporate culture and art into community development projects in rural areas

B- Established ‘No-na-me-gi’ and currently carrying out social job-creating project with the business plan completed during the incubating course - Currently preparing for certification of social enterprise in June this year

C

- Established ‘Bicycle Loaded up with Love’ and received certification of social enterprise in May 2009 - Collect and repair bicycle in metropolitan area and nationwide. Currently providing training and carrying out projects to expand the provision

D - Not reachable due to personal reason

3) Course Curriculum ○ General Course (30 hours)

○ Individual Course (15 hours each)

○ Mentoring

4) Follow-up research on course graduates’ engagement in microcredit business

Type of project Contents

1) Capacity building of social-economy activists

- Capacity building focused on workshops and action learning․Understanding social economy ․Establishing and running social enterprises․Methodology of social accounting & community research ․Professional training by region and area

2) Establishing business strategy for social economy

- Establishing policy and implementing pilot project ․Researching and analyzing community needs and circumstances. ․Evaluating and giving outlook on community project: establish policy and implement pilot project ․Developing regional model for social-economy organization: apply social accounting ․Raising community awareness on social economy

3) Building network of social-economy movement

․Build blocs connecting social-economy activities within community․Seek ways to promote cooperation among social-economy networks across the country

3. Creating social economy together (2009 ~ present)1) Business overview ○ Context - Local communities are in need for strategic units and organizations to realize social economy. - Social economy models suitable for local communities should be discovered, developed and

expanded. - The most urgent task is to train social-economy organization staffs that are the foundation of

all community projects. ○ Period: September 2009 ~ present - A period of three years per each community - Currently there are 40 people in 3 local communities that are involved in the project since 2009. ․Metropolitan district north of the Han River (15 people): Gangbuk Self-help Promotion Agency

& Samyang People’s Solidarity & Gangbuk House of Peace ․Seoul Gwangjin area (16 people): Gwangjin Self-help Center & Gwangjin People’s Solidarity &

Neul-pu-leun-bom (prospective social enterprise) ․Northern Bupyeong area of Incheon (9 people): Bupyeong Nam-bu Self-help Promotion Agency ○ Content - 1styearcore project: strengthen capacity of and provide training to activists engaged in social

economy activities in local communities. - 2ndyear core project: establish social economy strategies and networks suitable for each

community. - 3rdyear core project: organize network of social-economy movement and build blocs that support

the community’s social economy. ※ Strengthening activist capacity, establishing strategies and building social-economy blocs are not

carried out separately according to the yearly plan but are conducted simultaneously. However, core projects are selected separately for each year since building community-based social-economy bloc can become difficult when strengthening activist capacity and establishing local strategies are not fully implemented.

4) Strategy to mobilize resource and raise funds to promote social economy

․Establish community-based organization that supports social economy․Organize community fund partnership ․Collective reaction to mobilize social contribution fund and policy fund

5) Establish and propose policy to support social economy

Research on measures to support the promotion of social economy in local communities

2) Project Execution ○ Central taskforce team (relevant experts) will directly engage in communities that are willing to

create social-economy model to strengthen capacities of working-level staffs, tackle community issues and make strategies in cooperation through training and discussion.

○ Central taskforce team includes the Korea Foundation for Social Investment that is in charge of the project and 20 experts from social-economy areas.

○ There are 10 to 16 members in community taskforce team in each local community who aim to realize social economy, engaging in areas such as regional self-help promotion agencies, social enterprises and civial society organizations.

○ The following are needed to strengthen the capacities of social-economy activists: - Use diverse set of methods, such as training, workshop, consulting, advising, information

provision and monitoring. - Course subjects are selected based on not only the business area each attendants are involved

in, but also on the services and needs of the local community and during the process of business planning.

- Therefore, courses are executed in a similar manner in all communities but the course subject and curriculum may differ.

- In case any common issue should arise in communities undergoing ‘creating together,’ 3 institutions hold joint workshops to work out the issues together. (Ex: strategies to localize social service)

- Curriculum for activist capacity building that has been executed so far is as follows: ․Understanding social economy (Social economy & region_ joint workshop, the past and present

of social economy) ․Case study of social economy & lessons learned (SEL report: care, recycling, childcare, housing

and aging issue, etc.) ․social-economy organization from the perspective of social accounting ․Community research methodology & the need of resident consciousness study ․Evaluation of community activities (evaluation of all unit projects conducted during 3 months) ․Building Korea’s social service system and our challenge (joint workshop) ․Balance score card & strategy system chart

1styearp r o j e c t stage

Schedule Subject Remarks

Understanding social economy

E a r l y Oct.∼E a r l y Dec.

1stsession Social Economy, community and I Workshop

2ndsession The past and present of social economy Community

workshop

3rd&4th

session

Case study of social economy & lessons learned (SEL report)

Community workshop

5thsession Social accounting Community

workshop

Examining community projects

Schedule by community Gangbuk Gwangjin Bupyeong Contents

Dec. ∼M a r . 2010

6th

Project evaluation of 18 areas



Eval ua t ion of project/ organization/community

7th

8th

9th

10th

11th

P l a n n i n g community project

A p r . ∼May.

12th Comprehensive project evaluation & core project planning Preparation forestablishing business plan

13th Select high priority project for business planning and review questionnaires for resident consciouness study

14th~16th

Confirm resident consciousness study and select comprehensive assignment / community research methodology, BSC training

Jun.∼Aug.- Conduct resident conciousness study - Establish business plan for selected core community project and carry out comprehensive & collective assignment

Setup of business plan for resident consciousness study

Evaluating 1styearperfo

rmanceEnd of Aug. 23 sessions

3) 1styearprogress (Oct. 2009 ~ May. 2008)

Course name Purpose Target Feature Result

Microcredit Expert Training

To promote microcredit business

Prospective CEO or working-level staffs of microcredit institution

Supply of working-level staffs for specific types of projects nationwide

Supply of workforce to respond to MC project expansion in 2009

Social Entrepreneurs

Incubating

To carry out intensive training of prospective social entrepreneurs

Prospective social entrepreneurs with ideas to achieve social purpose

Training of a few selected elites

Cultivate experts to support establishment and business of social enterprises

Creating Social Economy Together

To build localization model of social economoy

Community activists who aim to realize social economy

Capacity building of activists based on community and project throughAction Learning

Overall capacity building of community activists in social economy and immediate reflection of the result in projects

4. Distinctive features of the training course

○ Microcredit Expert Training produced a total of 200 course graduates across the nation. The engagement of these people into the microcredit business was certaintly timely considering the Korean government’s expansion of microcredit business in 2009. They are also actively participating in local community projects, such as in self-help finance.

○ The Prospective Social Entrepreneur Incubating was programmed to mobilize diverse set of infrastructures to train and cultivate a single social entrepreneur. It was motivated by the training method of the ‘Ashoka Foundation,’ that focuses on fostering a few selected elites. As a result, three class attendants currently participate in social enterperprise business directly, delivering many small and large results.

○ As for the ‘Creating Social Economy Together,’ a course that began most recently and is ongoing currently, it’s difficult to consider it targeting just social entrepreneurs. It is because it started as a project to reorganize social-economy activists who work to meet the needs of and solve the problems of local communities, so as to explore new models for the community. After all, it is the ‘people’ who are driving this project and accordingly the most amount of energy is concentrated on promoting growth and change of these ‘people.’

Another key distinction is that the training course, rather than training one particular person, encourages each attendant to grow and mature on an individual level by strengthening their debating skills in a group setting. The Action Learning is also a distinctive feature of the training course that encourages each class attendant to get on-site feedback on the evaluation, planning and strategy of the projects they are involved in and to revise it accordingly.

○ After analyzing each training course of the curriculum, the Korea Foundation for Social Investment have come to the conclusion that the best training model to provide the most appropriate support to the social-economy activists in Korea and to cultivate social entrepreneurs is to provide support in the field, encourage growth in the field and get feedback in the field.

○ So far, social enterprises in Korea have mostly been assessed to take the form of non-profit organization in terms of enterprise type and culture. It has also been diagnosed that training course should encourage stakeholders from enterprises and communities to deliberate and discuss issues together, rather than provide intensive training for a few selected elites to produce a single social entrepreneur. Such type of training method is considered more likely to be applied to the field and to last longer.

Ⅲ. Proposal Although for a short period of time, the foundation has developed and has been operating several different courses to train social entrepreneurs. Based on the past experience, this paper makes several key propositions that must be reflected in the training course for social entrepreneurs in Korea. ○ Momentum is boosted when there are multiple social entrepreneurs growing together in local

communities and organizations. - While we were analyzing data on foreign training institutions for social entrepreneurs, we came

across a fantastic system that patiently and wholeheartedly provides full financial support and time, a year at the least upto three years and more, to train a single social entrepreneur.

- However, behind all that support, we were able to feel that the social entrepreneur was expected and asked to exercise ‘entrepreneurship.’ After all, ‘people’ are who stand at the very core of social enterprise and it was clear that they were strongly determined to cultivate an entrepreneur that will someday own a social enterprise. It was indeed fascinating.

- Nevertheless, based on what we have experienced so far, we do not expect a single social entrepreneur to provide all the solutions. It is only when the entrepreneur’s co-workers, supportive organizations and the society work together that the social enterprise lives up to our expectation. Social enterprise should not be run by a single entrepreneur either. Social enterprise can exist, making positive changes in our communities and society, only when multiple social entrepreneurs with multiple capacities become the majority in the organization and in our society as a whole.

- Therefore, in order for sound social enterprises to grow sustainably, entrepreneurs’ co-workers, supporters and partners should also be trained simultaneously. Furthermore, the focus should be on the ‘field’ and ‘practice’ to identify the needs of communities and the society and to deliver successful business results. In other words, there is a limit to what ‘training institutions’ can

teach social entrepreneurs. - Therefore, training systems should be programmed in a way that they can learn, share

information and grow with many other co-workers on the worksite to build social enterprise together.

○ Training should be tightly linked to the field and should be verified on the field. - Analysis of world-renowned training institutions for social entrepreneurs indicates that their

primary focus is on field training. This is the case of the School for Social Enterprise in England, the Harvard Business School (HBS) social enterprise initiative that utilizes career development program and extracurricular activities and lastly the Université de Marne la Valeé in Paris that carries out joint project with its partners and runs training/internship program.

- However, no matter how field-focused or field-based the curriculum might be, it cannot be more field-focused than the social enterprise or the community itself. It is time for us to figure out how to actively incorporate the course system into the field and social enterprise itself, rather than to just wait for social entrepreneurs to join the course. A good case in point is ‘Creating Social Economy Together.’

- This is essential for the monitoring and verification of the ‘training’ per se. We should constantly review and monitor whether the current training courses for social enterpreneurs provide what is appropriate for and needed at the actual work place and reflect the result in the training accordingly.

○ Social enterprise is a movement to change the society. - Social enterprise is a movement where ‘people’ who aim for change of the society matter more

than anything else. However, it’s hard not to notice that some of the training courses in Korea are trying to apply market-based ‘commercialization strategy’ to social enterprises that started business with the purpose of changing the society. Curriculums seem to be filled with classes that teach sales and marketing skills, transformed and sold as some type of MBA program.

- The fundamental competitiveness of a social enterprise comes from ‘people,’ not capital or technology. In particular, it requires the motivation to achieve social purposes and to serve public interest. This should be the fundamental faith and turning this into business requires the ability to plan and mobilize needed resources.

- Curriculums that reflect such distinctive characterisitics of social enterprise should be taken to the next level to reinfoce people’s capacities based on individual faith, beyond simple delivery of knowledge. In this respect, the Action Learning program is worthy of notice, although it hasn’t been fully utilized in the fields.

- We expect social entrepreneurs to build up the necessary skills through the Action Learning to successfully continue the projects even when the central taskforce team of ‘Creating Social Economy Together’ exits out of the scene.

There seems to be too much burden on the shoulders of social entrepreneurs. The CEO of A, the first ‘labor-integrated’ social enterprise in Korea, said, “Social enterprise

CEOs are very lonely people. It’s never easy to find ‘social partners’ who share the same value

of ‘social enterprise.’ It becomes unclear with time ‘why we are a social enterprise.’ The challenge of surviving in the market becomes the most pressing issue that faces us. What is sad is that I can’t guarantee whether the employees can go on without forgetting the social purpose and value we created when we started the business if I quit or lose balance and fall.”

The last words of the CEO overwhelmed me with a sense of pressure and responsiblity as I was writing this paper. It feels like I hear an outcry, clamoring for a ‘social enterprise organization and field training’ that not only trains new entrepreneurs but supports existing social entrepreneurs so that they can contribute more to the society.

corporate role in promoting social entrepreneurs · corporate role in promoting social...

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