Social Business' was first formally developed by Nobel Laureate Professor Muhammad Yunus in 2010 through a book titled Building Social Business with a view to creating a poverty-free world. According to Yunus (Page xii- xiv, Building Social Business), we can create a poverty-free world if we redesign our system to take out its gross faults which create poverty. He compared poor people with 'bonsai' tree and remarked that if we could help poor people out of poverty by creating an enabling environment, then it is a matter of time only to resolve worldwide poverty problem.
But the question arises how this redesign process can be integrated into the traditional way of economic thinking and doing business to help out these 'bonsai' people. Yunus answers the question by following the simplest way at the beginning. In his opinion, fundamental change in the architecture of the capitalist economy can be brought by bringing it closer to a complete and satisfactory framework, freeing it from the basic faults, social and environmental ills along with poverty (Page xiv, Building Social Business). Moreover, he rejects the usual evaluation of global financial crisis of 2008- 2009 period. He thinks that the biggest flaw in the existing theory of capitalism lies in its misrepresentation of human nature, where men are described to be single-minded, that is businesspeople are portrayed as people who are interested to maximise profit only and nothing else (Page xv, Building Social Business).
Well, he does not reject that humans are selfish beings, but observes that they are simultaneously selfless - the worldwide existing institutions are not only designed to generate maximum individual wealth but also to establish churches, mosques, synagogues, art museums, public parks or health clinics or community centres which are the strong illustrations of selflessness motive of human beings as these institutions don't make anyone a tycoon. So, if the flaw of economic theory based on one dimensional person is recognised and replaced with one based on multidimensional person (a person who has both selfish and selfless interests at the same time), then the problem would be solved (Page xvi, Building Social Business). So, a new kind of business known as social business should be self-sustaining, that is, it generates enough income to cover its own costs and part of the economic surplus is invested in expanding the business, while a part is kept in reserve to cover uncertainties. Moreover, in this kind of business, the company makes a profit, but no one takes the profit (Page xvii, Building Social Business). So, this is the way how social business actually gets started in traditional business.
Now let us look at the worldwide field-level situation of social businesses. Starting from the example of Bangladesh, we are already aware of the name and fame of the world's first Yunus-type social business, Grameen Danone Foods Ltd. (GDFL), which started its journey in early 2007 and promised to offer its 'Shoktidoi' (yogurt) at cheap rates to help poor people, mainly children and women in Bogra district, get nutrient-rich foods. Other objectives of GDFL are to promote local business activity and to indirectly create jobs in the agricultural industry, or in sales and distribution. To ensure the initiative's long-term success, the idea was to offer appropriate micro-financing solutions and professional training tailored to the people from local communities who will be taking part in the project (extracts from press release published by Groupe Danone on March 16, 2006).
The GDFL then planned to set up and launch as many as 50 production plants during the 10 years between 2006 and 2016. The first factory was built in Bogra, with a daily production capacity of 3,000 kgs to 10,000 kgs. The plant was built only on 75,000 square feet areas which included milk reception, mixing and fermentation, a filling line, packaging station, a laboratory, a cold room, a storage room, and office space (Hussain, Chowdhury & Hussain, Page 257- 258, Vol. 2, No. 4, World Journal of Social Sciences, July 2012).
At an initial stage though, the GDFL had faced many problems regarding its marketing and distributional procedures but later, after getting matured as a company, it learnt to cope up with present market structure which proves that a social business can indeed be sustained and is better than any other form of charity. In the words of Professor Yunus, "A charity dollar has only one life; a social business dollar can be invested over and over again".
The organisation, Yunus Social Business (YSB), is now currently working in Haiti and Albania. The Haiti Initiative was launched in 2010 by the YSB's predecessor The Grameen Creative Lab with corporate partner SAP AG to foster prospective social businesses through financing and incubation.
In March 2013, Professor Yunus, Sir Richard Branson, founder of Virgin Unite, and former US President Bill Clinton, founder of the Clinton Foundation, announced the launch of a new social initiative called Haiti Forest. The partnership aims to solve social and environmental problems in Haiti by bringing sustainable, productive and socially responsible forests to the country.
Ten thousand hectares of land are being promised by the Ministries of Agriculture and Environment to develop the new, bold Haiti Forest Initiative (HFI) in Artibonite and northern part of the country. The HFI has full support of the government of Haiti and is in line with the priorities of the government to support long-term reconstruction efforts, especially those that create jobs and promote economic opportunities. The multi-year project will provide affordable food, timber, and employment in Haiti, and will be organised as a social business - a company set up for maximising social benefit rather than private profit.
The social business movement of Albania is a programme started by the YSB in April 2012 to initiate and scale up social businesses throughout the country. Started at the request of Albania's Prime Minister, and working hand in hand with an agency created by the Albanian government for promotion of social business in Albania, Nxitja e Biznesit Social Sh.A., the programme includes the incubation and investment as main focal points.
Later in January 2013, Yunus signed a memorandum of understanding with Tirana Business Park, an Albanian investment of the German company Lindner Group, for setting up a joint venture in vocational training social business. The MoU was signed at the Tirana Business Park construction site in Albania in presence of Prime Minister Sali Berisha.
Working together with the Department of Human Development (OSHD) of African Development Bank (AfDB) and financed by the Policy and Human Resource Development Grant of Japan (PHRDG), the YSB launched a holistic social business movement in Africa in December 2012. As a part of this movement, the YSB and the AfDB will first raise awareness through national conferences on social business in Tunisia, Togo, and Uganda and subsequently will establish social business incubators and funds in Tunisia and Togo in the second half of 2013. The national conference on social business in Tunisia took place in March 2013, at IHEC in Carthage, Tunisia.
Prof. Yunus launched a number of social business initiatives in Brazil during his visit there from May 27-29, 2013. The Bank of America announced the creation of a Yunus Social Business Fund for Brazil during his stay there. ESPM, a leading business school in Brazil, also launched Yunus Social Business Centre which will develop academic curricula around social business. Brazil Foods (BRF), one of the largest poultry companies in the world, has announced a joint venture social business in Haiti for developing poultry business in the earthquake-affected island. Italian city of Pistoia was announced as first social business city on July 11, 2012.
