Social Business: A New Chapter of Hybrid Business Toward Sustainable Development

Abstract

The concept of social business emerged in 2006 as a hybrid business model in response to the failure of government sector and philanthropic efforts to provide sustainable solutions to social and environmental problems. Social business is a cause-driven or social objective-driven business model that intends to harness the business principle and philanthropic motive together to achieve positive social change in a productive and commercially viable way. It is a business in every sense with the replacement of economic profit maximization goal with that of social benefit maximization. Theoretically, social business is assumed of being capable to resolve almost all sort of social problems including poverty, unemployment, environmental degradation, and health and sanitation problems by means of balanced allocation of scarce resources, thereby can help achieve sustainable development goals (SDGs). Thus, it seems apparent that the concept of social business and sustainable development is closely intertwined and the functions of social business encompass the agenda of social and environmental sustainability. Yet, social business is not meant to alter capitalism; instead, it tends to offer "enlightened capitalism" to cure the flaws of the free market system. However, as a relatively new mechanism, social business suffers from several limitations and encounters numerous challenges. Replication and scaling up successful ventures are required for this concept to advance magnificently and to serve the planet and the people effectively.