The coronavirus pandemic has revealed some issues with the global economic system that could potentially hinder progress toward greater equality around the world. Recent estimates show that nearly a half-billion people will likely end up living in poverty amid the fallout, which could hamper progress in the move toward development by several decades. While most of these cases will occur in emerging economies, even developed countries will experience some issues since stimulus packages do not frequently reach people outside of the economic mainstream.
Recently, the International Labour Organization, an agency of the United Nations, warned that the pandemic has impacted about 1.6 billion workers in the informal economy. The looming problem has motivated many social entrepreneurs to work on projects that could mitigate these effects.
The Impact of Global Social Entrepreneurship
Social innovators have spent many years working on more sustainable market expansion models as a way of preventing economic failure. A recent Impact Report from the Schwab Foundation for Social Entrepreneurship showed that 400 top social entrepreneurs have positively impacted the lives of more than 622 million people around the world by protecting livelihoods; driving environmental sustainability and social inclusion; and increasing access to education, energy, health, and sanitation.
Since the start of the COVID-19 pandemic, social innovators have stepped up to help people who lack support from the government or non-governmental organizations. These individuals have assisted in providing access to mental health care and community tracing, as well as care for people living in economically challenged areas.
Organizations created to protect vulnerable populations are encountering more constraints than ever before, and many of them are facing potential bankruptcy. Moving forward, more support from the social entrepreneurship ecosystem will be necessary to avoid setbacks in impact investing. For four decades, this ecosystem has been growing to include peer learning networks, impact investors and philanthropists, and even intermediaries that can create blanket standards and offer certification to boost confidence.
The larger ecosystem has recognized the economic hardships that the pandemic will cause, and 40 organizations have teamed up to create the COVID Response Alliance for Social Entrepreneurs. The initiative, which involves more than 15,000 social entrepreneurs, serves as a forum for sharing resources and experiences, as well as on-the-ground knowledge.
Support for Social Entrepreneurs Working to Restore Economies
According to the alliance, support will be provided for social entrepreneurs who are working to restore economies from the pandemic in four key ways. One of the most important ones involves expanding financial support for social entrepreneurs seeking to amplify their work. Additionally, the alliance will coordinate non-financial support through partnerships with various companies and intermediaries, including technologists and lawyers. Thirdly, the organization aims to assess the social enterprise portfolio of members to highlight specific needs and augment efforts. Finally, joint communication initiatives will ensure the creation of appropriate policy interventions and fiscal initiatives to support economic recovery. Viewing social entrepreneurs as frontline workers, the founders of the alliance created the organization to ensure that they received the support that they need.
One of the primary resources provided by the alliance is Covidcap.com, a project driven by the Duke University Center for the Advancement of Social Entrepreneurship. The website includes a dashboard to search for emergency funds that both nonprofit and for-profit entrepreneurs can use to fuel their efforts. The global capital relief efforts represented in the database total more than $1 trillion, an amount that can effect incredible change throughout the world and help communities to emerge from the pandemic stronger than before. Social entrepreneurs have a key role to play in expanding opportunities within communities across the globe and helping individuals to reclaim economic power.
The Path Forward for Social Entrepreneurs
Even outside of the alliance, funding opportunities are available for social entrepreneurs who are working to create stronger and sustainable economies. While some entrepreneurs may think that a global economic downturn might discourage startup investment, this is not necessarily the case. Many venture capital firms recognize not only that some of the most successful companies grew out of bear markets, but also the critical role that social entrepreneurs will play in the market’s recovery, so it is in their best interest to support their endeavors.
As global leaders in systems change, social entrepreneurs can empower entire groups to become the primary agents of change in their lives. As the coronavirus pandemic has demonstrated, the world can change very rapidly. Social entrepreneurs are the ones who can respond to this change in meaningful ways in order to enact positive and lasting change.
The larger social entrepreneurship ecosystem can create strong communities that are able to support themselves financially. Moving forward, these entrepreneurs may need to rethink their approaches. They will play a key role in making economies around the world more resilient and inclusive.