Social Impact and Business - Can they go together?: Understanding Social Impact Firms

Challenges Faced by Social Impact Firms in India 

Authored by AKSHA JAIN, University of Delhi

With a large population, India is a nation with many social and economic problems. With high levels of inequality, restricted access to essential services like healthcare and education, and little economic possibilities for disadvantaged populations, poverty and marginalization are pervasive. A viable way to address these issues is through social entrepreneurship, which establishes long-lasting companies that put the welfare of society and the environment ahead of financial gain.

Businesses with a social or environmental goal at their heart are known as social enterprises, and they solve social and environmental problems with market-based solutions. Social impact firms are organizations that prioritize creating positive social and environmental change alongside financial sustainability. They operate in a unique space, blending elements of traditional businesses with a strong focus on purpose-driven goals. Social companies are gaining popularity in India as a means of combating marginalization and poverty. 

Women-led Social Impact Firms of India

Women-led social firms are a powerful force for good in the world, tackling complex challenges with innovative solutions and a unique perspective. These firms are often driven by a deep understanding of the specific needs and challenges faced by women and girls, and they work to create positive change in areas like education, healthcare, economic empowerment, and environmental sustainability.

India boasts a vibrant ecosystem of women-led social enterprises, tackling critical challenges with innovative solutions and a deep understanding of local contexts. These remarkable women are not only empowering other women and girls but also driving positive change across various sectors. Some of the notable and inspiring examples are listed below: 

1. SEWA (Self Employed Women's Association): Founded in 1984 by Ela Bhatt, SEWA is a national trade union with over 2 million members, primarily women informal workers in India. They advocate for better working conditions, social security, and access to essential services for their members.

2. LiFT (Light for the World): Led by Dr. Tessy Thomas, LiFT works to prevent blindness and restore sight for millions in India. They provide high-quality, affordable eye care services in rural areas, train local healthcare workers, and raise awareness about eye health.

3. Urmul Sangam: Founded by Hema Subramaniam, Urmul Sangam empowers transgender women in India through skill development, livelihood opportunities, and advocacy. They run vocational training programs, social enterprises, and awareness campaigns to combat discrimination and ensure equal rights for transgender individuals.

4. Aarti Industries: Led by Dr Aarti Shivdasani, Aarti Industries manufactures and distributes affordable sanitation products for women and girls in rural India. Their flagship product, the menstrual cup, provides a hygienic and sustainable alternative to traditional disposable pads, which are often inaccessible or impractical in rural settings.

5. Samhita Social Ventures: Founded by Priya Naik, Samhita Social Ventures empowers rural women entrepreneurs through financial inclusion and business development services. They provide microloans, training programs, and market linkages to help women start and grow their own businesses.

These are just a few examples of the many incredible women-led social firms making a difference in India. Despite the challenges of funding accessibility, work-life balance, lack of visibility and others; the landscape for women-led social firms in India is evolving. Increased awareness, supportive government initiatives, and growing access to technology are paving the way for a brighter future. These women entrepreneurs are not only changing lives but also inspiring a generation of future leaders to create a more inclusive and sustainable India. As the number of women-led social firms continues to grow, we can expect to see even more innovative and effective solutions to the world's most pressing challenges.  

Challenges and The Way Out

The studies suggest that social impact firms in India face challenges in areas such as philanthropic donations, community service, employee welfare, promoting religious conduct, affordability, innovation, cost control, local engagement, skills and capability building, dynamic leadership, scalability, and integrating products with corporate strategy. 

Despite these challenges, social impact firms play a vital role in tackling critical societal issues. By recognizing these obstacles and working towards innovative solutions, they can strengthen their impact and pave the way for a more just and sustainable future. Some of the solutions can be as follows - 

Developing new financing models: Explore hybrid models combining grants, investments, and earned income to create sustainable funding streams.

Investment in impact measurement: Standardize impact measurement methodologies and leverage technology to better track and communicate their results.

Building strategic partnerships: Collaborate with governments, NGOs, and private businesses to access resources, expertise, and wider outreach.

Raising awareness and educating stakeholders: Advocate for better regulations, promote understanding of social impact models, and build trust with the public.

Embracing innovation and adaptability: Constantly seek new solutions, technologies, and partnerships to overcome challenges and scale their impact effectively.

Conclusion

In the final analysis, we can infer social entrepreneurship has gained the capacity to use creative and long-lasting business strategies to combat poverty and marginalisation in India. Even though the industry has many obstacles, including difficult access to capital and regulatory hurdles, India is home to a number of prosperous social entrepreneurs and impact investors who have had a major positive social and environmental impact.

The studies on Social Impact Firms in India offer suggestions for fostering an atmosphere in India that would foster impact investing and social entrepreneurship. In order to build a more sustainable and just future for India, impact investing and social entrepreneurship need to be encouraged. Increasing capital availability, advocating for favourable laws and regulations, and fostering networks and partnerships between impact investors and social entrepreneurs are just a few ways to do this. 

We can build a future in India where underprivileged groups have access to fundamental services, sustainable livelihoods, and improved quality of life by encouraging social entrepreneurship and impact investing. 

References

Spieth, P., Schneider, S., Clauss, T., & Eichenberg, D. (2019). Value drivers of social businesses: A business model perspective. Long Range Planning. https://doi.org/10.1016/J.LRP.2018.04.004. 

Elembilassery, V., Bhaskar, K., & Aggarwal, D. (2019). Rolling drops: Nilkamal Wello Water Wheel. Emerald Emerging Markets Case Studies. https://doi.org/10.1108/eemcs-06-2018-0122.

https://www.linkedin.com/pulse/social-entrepreneurship-india-opportunities-challenges-yadav

(Information on Women led social enterprises has been sourced from various sources including their websites)