More than ‘Cool Runnings’: Social Enterprises in the Caribbean (and Africa)
To some, the Caribbean brings to mind beaches or even a movie of questionable appeal about an unexpected group of men in a bobsled. It may be less common, though, to hear about the Caribbean in the context of Social Impact. This is despite the fact that the Caribbean has at least a few roughly similar economic challenges, like increases in poverty rates, with developing regions like Sub-Saharan Africa.
An interesting question then maybe why is Uganda, for example, more likely to be mentioned in conversations about Social Enterprise than Guyana? Additionally, are there implications on Social Enterprise’s ability to improve the lives of low-income Caribbeans?
These questions matter because the Caribbean is experiencing another episode of high debt, with the region owing 70% of GDP in debt and countries like Jamaica with public debt at 143% of GDP. State responses like austerity programs can have a negative impact on livelihoods, and potentially a role for Social Enterprise to bolster fortunes.
NASA, Mars and Africa
Dambisa Moyo, an economist and author, once said that Africa is to International Development as Mars is to NASA; so too might Africa be to Social Enterprise?
A different answer might start from the view that Social Enterprises are more likely to occur in regions with high poverty, due to a pressing need to serve more people and find alternatives to (inadequate?) poverty alleviation initiatives. As a result, if poverty is higher in Africa, then there will be more Social Enterprises and a greater association with Social Enterprise.
While it’s clearly untrue that everyone in the Caribbean owns BMWs, fundamental economic disparities exist between Africa and the Caribbean. In Latin America and the Caribbean, in 2010, poverty headcount ratio as a % of the population was 5.5% – 43% points lower than Sub-Saharan Africa. In other words, with almost half of the population in poverty , it maybe that Africa has a “greater need” for – and is more strongly associated with – Social Enterprise.
“Oh, I think they like me.”
If we accept there is a greater “need” for Social Enterprises in Africa, then you may also expect a greater African interest in starting Social Enterprises, and less so among Caribbeans. Interestingly, one study suggests that this might not always be the case.
According to the Global Entrepreneurship Monitor (GEM), in both Africa and the Caribbean, ~2% of the adult population is involved in a new social enterprise. To put it another way (while admittedly only from one data point) despite differences in poverty rates, both Africans and Caribbeans are roughly equally likely to be involved in new Social Enterprises. Additionally, enterprises in both regions seek to address similar issues. Of the more than 10,000 individuals included in the GEM study, participants in Social Enterprises sought to achieve a similar broad set of Social, Economic and Environmental objectives – akin to many Social Enterprises in Africa.
Yet, whether in Trinidad, Togo or Thailand – the fundamental pressing question is more if Social Enterprise can deliver better results than other interventions, a question that is tough to answer.
That said, it might mean there is an even more pressing need for Social Enterprises in Africa to be effective, given a need to support a higher absolute and percentage-wise poor people versus other regions, like the Caribbean.
Nonetheless, given the continued interest in Social Enterprise and persistent challenges in economic development, knowing a bit more about how social impact manifests across the world – (and implications on a region’s association with Social Enterprise) – may hopefully help us make more effective enterprises.
Where grant and other fundraising is involved, agency theory/principal-agent dichotomies affect can skew measurable rates of altruism. At some point, every granting organization will prefer to support initiatives more likely to succeed in their mission than those that attempt to address the most urgent crises.