The death of the social entrepreneur?

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Norwegian peace researcher, sociologist and mathematician Johan Galtung has invented a method called TRANSCEND for conflict transformation by peaceful means. According to Galtung (and Wikipedia);

“there are four traditional but unsatisfactory ways in which conflicts between two parties are handled:

  1. A wins, B loses;
  2. B wins, A loses;
  3. the solution is postponed because neither A nor B feels ready to end the conflict;
  4. a confused compromise is reached, which neither A nor B are happy with.

Galtung tries to break with these four unsatisfactory ways of handling a conflict by finding a “fifth way”, where both A and B feel that they win. The method also insists that basic human needs – such as survival, physical well-being, liberty, and identity – be respected.”

***

I’ve been thinking about using the TRANSCEND method for one of today’s conflicts. The profit vs. non-profit conflict.

We have recently come to understand that for-profit organisations are problematic, as they do not always care about the planet and its people. These are not considered in their model and seen as “externalities” to be cared for by others.

Most non-profits care for these, but on the other hand often don’t care about profit and financial viability. Both these organisational forms are therefore problematic. There has always been a tension between them, which has been seen as good for the evolution of the planet and humanity. If one of them becomes too strong the other will push back through the democratic process.

Some people still think these can co-exist and that the tension between for-profit and non-profit is healthy. Others see a conflict and point out that for-profit, market economy / capitalism itself is actually fuelling the fire of the challenges that the non-profits try to tackle. Naomi Klein in This Changes Everything for instance writes that:

“Very little, however, has been written about how market fundamentalism has, from the very first moments, systematically sabotaged our collective response to climate change, a threat that came knocking just as this ideology was reaching its zenith.”

Market proponents mean that the markets will solve this eventually and the planet will survive. Their opponents mean that markets are the underlying problem to the destruction of the planet. We have a conflict.

***

If we apply TRANSCEND to this conflict it could look like this:

(I use for-profit vs. non-profit as the chosen conflict here. It could be capitalism vs. collectivism, market economy vs. peer economy, scarcity-based vs. abundance-based thinking etc etc – you get the point…)

1. A wins, B loses, i.e. for-profit wins, NFP loses. This is what some people think is happening now. The planet is currently being destroyed because for-profit is winning. The tension between the two is out of balance on a global scale. The for-profit model and the organisations which subscribe to it, have much more impact than non-profit organisations. Microsoft has way more impact on the world than the Bill and Melinda Gates Foundation. Apple have way more impact on the planet than Greenpeace. They play in totally different leagues. And this gap is growing. Even if non-profits, charitable foundations and cause-driven organisations are growing in size and impact, they are hopelessly behind.

2. B wins, A loses; i.e. NFP wins, for-profit loses. Many argue for this as the way forward and a world where NFPs dominate. Donnie Maclurcan and Jennifer Hinton of the Post-Growth Institute for example write in The Guardian: “We’re witnessing the rise of a workforce increasingly motivated by purpose, and we’re realising the potential of an existing business structure called not-for-profit (NFP) enterprise.”

3. The solution is postponed because neither A nor B feels ready to end the conflict. There is actually no conflict yet, but if Naomi Klein and others will get their message through, the “conflict” might escalate into something more resembling a conflict. Klein’s attacks on multinational corporations and the negative effects of globalisation (in No Logo) and US “democratization” of other countries (in The Shock Doctrine) have done much to change global opinions. Perhaps her new book, This Changes Everything, will do the same?

4. A confused compromise is reached, which neither A nor B are happy with. Today we see many hybrids between A and B, i.e. between the for-profit, market-based, scarcity model and the non-profit, purpose-driven, planet & people-including model. Conscious capitalism, for-benefit corporations, responsible capitalism, social enterprise and a plethora of new or tweaked models have emerged in recent decades. But are these only confused compromises, I wonder?
I have noticed others wonder as well:

* In a recent article, Rick Cohen asks the question “Is social enterprise becoming a reactionary force?” and whether “‘benefit corporations’ are “the harbinger of progressive change in the economy, or the soft edge of efforts to conserve the legitimacy of capitalism with a few marginal adjustments?”

* Joe Corbett argues that “Conscious Capitalism is like voluntary recycling, it is a mere gesture toward a more sustainable economic system, and is no solution to the globally systemic crisis of an insatiable drive toward ever increasing profit and consumption.”

* And management guru Henry Mintzberg calls bullshit on all new adjectives latched onto capitalism: “We have Sustainable Capitalism, Caring Capitalism, Breakthrough Capitalism, Democratic Capitalism, Conscious Capitalism, Regenerative Capitalism, Inclusive Capitalism”. “The assumption seems to be that If only we can get capitalism right, all will be well with the world. No doubt capitalism needs some fixing: the short-term pressures of stock markets are encouraging mercenary behaviours that are doing great harm to our democracies, our planet, and ourselves.”

***

I’m intrigued by transcending rather than compromising here.

So which would be Galtung’s “fifth way“? Something, where people who support both A and B, i.e. both for-profit and not-for-profit would feel that they win?

Galtung suggests a pathway: Creativity – transcendence – conflict transformation.

“Transcendence means redefining the situation so that what looked incompatible, blocked, is unlocked, and a new landscape opens up. Creativity is the key to that lock, block. The conflict has been transformed.”

That landscape is still not clear to me. I think there’s something in imagining a new landscape in a collective effort, but it’s way beyond me.

Suggestions, anyone?

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2 thoughts on “The death of the social entrepreneur?

  1. Thanks for the mention Adam, and the thought-provoking article.

    From our perspective, the analysis can change quite quickly depending on the initial binaries considered. For us, the more appropriate binary that stems from the ‘Market versus State’ debate is ‘private enterprise versus state socialism’. In this sense, we see the Not-for-Profit World model as the win-win, TRANSCEND option beyond this historically-embedded binary, keeping the market, along with a focus on employment, social innovation and creativity, whilst reducing the systemically damaging impacts that come with the privatization of profit.

    We’ll have more details about our latest thought up at http://www.howonearth.us by the middle of June.

    Warmly,

    Donnie

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