Senate Bill No. 176, or the 2016 Poverty Reduction Through Social Entrepreneurship (PRESENT) Bill, aims to provide a “nurturing environment for growth and the burgeoning of strong and innovative social enterprises as tools to reduce poverty.” A similar bill was filed in the House of Representatives in 2012, but was turned down due to the significant amount of reservation on the part of the congressmen.
The bill pushes for the creation of a PRESENT Program, a Social Enterprise Development Council and a Center for Social Enterprise Development – all of which are responsible for the promotion, growth, development, and implementation of policies for such development in the country. Moreover, the bill spells out benefits and incentives for social enterprises, such as the social enterprise development fund and tax exemptions, among several others. According to the Institute of Social Entrepreneurship in Asia (ISEA), there are more than 30,000 social enterprises in the country, such that when the necessary government support mechanisms come into place, about 2.5 million poor Filipinos could benefit from these businesses.
However, one of the main challenges of fast-tracking the passage of the PRESENT Bill is that there is still a lack of understanding of the role social enterprises play in curbing poverty. Moreover, unlike in other countries that have working definitions of social enterprises, in the Philippines there is still no consensus on what social enterprises are.
One definition of social enterprises was developed by ISEA; they refer to it as social enterprise with the poor as primary stakeholders (SEPPS). SEPPS defines a social enterprise as a “social mission-driven, wealth-creating organization that has a double or triple bottom line, explicitly has a principal objective of poverty alleviation or improving the quality of life of specific segments of the poor, and has a distributive enterprise philosophy.”
One who is new to the concept of social entrepreneurship would think that social enterprises seem too hybrid and idealistic, and that they may not be sustainable in the long term given the multitude of things they wish to accomplish. Although this is true to a certain extent, this is also the main reason why there needs to be proper government support in order to allow social entrepreneurship to thrive in the country.
Given the SEPPS definition, what is also interesting is that local social enterprises typically perceive their laborers, beneficiaries and suppliers as partners and co-equals, not just as laborers, beneficiaries, and suppliers per se. Unless this is evident, the business will not be considered a social enterprise.
For instance, in a social business incubator called the Gawad Kalinga (GK) Enchanted Farm, the community members are involved in the social enterprises’ product ideation stage up to the final implementation. In other words, the social entrepreneurs, community members and other stakeholders work together as partners in the social enterprise. There is no strict or specific business hierarchy implemented, because everyone has a part in the development of the business.
It is important to note that while social entrepreneurship is still relatively new in the country, there needs to be a stronger ecosystem of support that will enable social enterprises to grow and scale their operations. Among the elements in the ecosystem are integrating social entrepreneurship into business education offered by universities, conducting more research into social entrepreneurship in the Philippine context, and pushing for more legislative action such as the PRESENT Bill, among others.
For now, while social enterprises are waiting for the necessary legislative actions and that no generally accepted definition has been established, there is arguably huge growth potential for these types of businesses.
Ian Benedict R. Mia is currently an undergraduate student taking up AB Psychology and BS Business Management at De La Salle University, and is a part-time research assistant under the Social Enterprise Research Network (SERN) of the DLSU Center for Business Research and Development. He is an aspiring social entrepreneur and is hoping to start an agricultural social enterprise in the future. He welcomes comments at email@example.com.
IAN BENEDICT R. MIA