10 striking features of the Malaysian social enterprise landscape
Pioneers Post embarked on a big trip earlier this year to Malaysia. As part of a video storytelling competition run by the the British Council, reporter Isabelle de Grave and producer Matthew Herring taught a social good journalism course to a group of social entrepreneurs. Whilst they were there they explored the emerging social enterprise landscape, and made 10 interesting discoveries.
1. No shoes…
And this is not a TOMS shoes campaign. There's a no shoes indoors policy in Malaysia, which is a cultural thing but it's good for business too. Eats Shoots and Roots a social enterprise that runs gardening courses for urban dwellers, Myharapan an organisation that supports youth led movements, and the Social Enterprise Alliance a support organisation for social enterprise, all insist that their staff go barefoot indoors. Culturally shoes are a no-no because they bring impurities into the home, but it's not a bad idea to carry this into a business context. It means less time and money spent on cleaning the floor. And it could make for a calmer working environment, psychologically, removing your shoes helps you to enter a frame of mind where you leave everyday troubles at the door.
2. Young professionals are the face of the movement
Young professionals are the champions of social enterprise in Malaysia. Social enterprise is sexy and hip and it's catching on in young professional circles. In part this is because leading support organisations like Myharapan and the British Council are heavily involved in developing youth-led enterprise. When we spoke to Nurfarini Daing CEO of Myharapan, an organisation that supports youth through volunteerism and social entrepreneurship, they had just hired a new employee. Daing told us she puts a strong emphasis on the level of professional skill employees can bring to social enterprise. "You need high levels of competencies and skill sets to be able to engage with a range of people with your sector and beyond, we're raising the bar when we talk about social entrepreneurship" she said.
3. Brain drain in reverse
We also sensed an element of brain drain in reverse. Most of the entrepreneurs we spoke to had received their education in the UK and gone back to Malaysia to get professional experience in business and then set up social enterprises.
4. Fears of a social enterprise fad
With the influx of young enthusiasm comes fears that excitable entrepreneurs could lose interest and lack commitment. Small social ventures are securing finance and training on incubator programmes like those run by the British Council and the Social Enterprise Alliance but it's a long road to success. Chooi Yen, content director at the Social Enterprise Alliance, told us that success rates are difficult to measure. Many enterprises are operating through successful partnerships with other organisations she explained, but few of those enterprises "are turning a sustainable profit" she said. Shamala Ernest, programme manager at the British Council expressed similar concerns. There is still a big question over whether the current wave of social businesses would be able to carry the responsibility and commitments of growth, "I'm not sure that many could take investment," she said.
5. Social enterprise still confused with social media
The movement is still nascent and there remains confusion around the nature of social enterprise. "When you tell people you work in social enterprise they often think you are doing something in social media or social relations" said Yen of the Social Enterprise Alliance. "When you explain you're a business working towards a social cause people understand but you come across the view that you shouldn't be making money out of communities that are underprivileged" she added.
6. NGOs scrambling for social enterprise models after international donor cuts
The speedy development of Malaysia and its transition to a high-income nation has meant local NGO funding from international donors has all but dried up explained Raymond Tai, marketing and communications manager at the PT Foundation, which provides HIV/AIDS education, prevention, care and support programmes. As a result the PT Foundation survives on government funding, which is slow and comes without the expertise and technical support that international donors offer. Tai explained that many NGOs were looking into ways to generate their own revenues but said that organisations like the PT Foundation would struggle to adapt due to the need to deliver free contraceptives, support and accommodation to people excluded from mainstream society.
7. Government support unclear
The fifth Global Social Business Summit was held in Kuala Lumpur last year (2013), which is the first time it has been held outside of Europe. Stepping up to the plate the Malaysian Prime Minister Datuk Seri Najib Razak announced a RM20 million social business fund under the Malaysian Global Innovation and Creative Centre (MaGIC). However there have been no subsequent announcements defining who will be eligible for the fund, and how to apply for the finance.
8. A mission to convince the corporate sector to be part of the support system
The Social Enterprise Alliance advises corporates on their CSR strategies and establishes links with social enterprises. But to date the relationships have been on a short term basis and the engagement is minimal explained Yen. Currently there are some multi-national companies engaging with the sector. Daing told us that Myharapan was in the process of building a network of corporate support including DHL and a potential relationship with Petronas the Malaysia's government owned oil and gas company. But Daing hopes to see more support from small and medium sized businesses, "we are trying to show how social enterprise can be relevant to both large and small organisations" she said.
9. Small business and social enterprise mergers are the dream
The goal for support organisations driving the social enterprise movement is to put it on a level footing with conventional business. Daing of Myharapan has her sights set on a dynamic sector where joint ventures and mergers and acquisitions between social purpose organisations and small businesses become commonplace "Our wish would be that social entrepreneurship is not separate from entrepreneurship," making the 'social' aspect of business a fixed feature of Malaysia's booming small business landscape.
10. A cosy sector with big potential
The social enterprise network in Malaysia is currently small, most of the organisations know each other, attend the same events and pitch for the same funding, Shamala Ernest explained. But the combination of support programmes, interest from young people with high skill sets, a fertile landscape for small enterprise, and a group of global corporations interested in supporting the sector could make Malaysia a future hotspot for social enterprise.