The Social Business

What does the SE100 Index tell us about social enterprise?

I did something new this week - I followed a conference on Twitter.  

Thanks to @SchSocEnt and @SEMagreporter I kept an eye on what was going on at Good Deals 2009 - the national social investment conference.  

I learnt, amongst other things, that plenty of people are keen to see some lighter touch social reporting, and that Liam Black had a dance on stage with Jeremy Nicholls.

I also learnt about some new research from SE100, which gave rise to headlines that social enterprises grow faster than the UK's other top companies.  

I had to look into that in more detail.  According to Social Enterprise Magazine's website, the top 40 social enterprises in the SE100 list enjoyed annual turnover growth of 78%.  This, in itself, seems impressive, but the icing on the cake is that it's almost double the turnover growth of UK-based companies listed in a similar index last month (that figure was 38.9%).

Whilst I'm not particularly good at maths, I am very interested in how statistics are used.  I had a bit of a closer look at the Index with which the SE100 index has compared itself.  

Business XL Magazine's Rising Stars list looks at the top 50 UK companies, in terms of turnover and profit growth.  These 50 businesses have a combined turnover of £1.3 billion, and combined profits of £147 million.  This averages out at around £20 million average turnover, and average profits of around £3 million.

Compare this with the SE100 list.  The top 100 (I can't find who they are) apparently have a combined turnover of £390 million - an average of just under £4 million.  In other words, on average, they're one fifth of the size of the average business in the other list.  We're not told how much profit they made.

My main point is that I don't think there is much value in comparing businesses which are very different in size.  What does it tell me if a group of 40 businesses which turn over an average of £4 million are growing at a faster rate than a group of 40 other businesses which average £20 million in turnover?  I'd say it tells me very little, regardless of whether they are social businesses.

I'm also a bit suspicious of the numbers chosen.  Why choose the top 40 for comparison - when one list looks at 100 businesses and the other at 50?  If they'd gone head to head, 50:50, you have to suspect that the figures wouldn't be such headline-grabbers.

Note:  Update 2 November:  Following the comment from Tim below, I think the suspicion in my previous paragraph is unfounded.  I hadn't realised that the Business XL list only gives financial information for 40 businesses - not all 50 in the list.  I've updated the blog as a result - see previous paragraph.  

I also question why we feel the need to prove that social enterprises are growing faster than for-profit businesses.  Who are we trying to impress?  Or is it just another example of the myth-making which is prevalent in some of the overheated parts of the social enterprise sector?  I'm currently running a sweepstake on when that stat is first used by a politician.  My bet is Tuesday morning.

And my final reason for looking into this more is that I don't hear enough voices at the heart of the social enterprise movement challenging stuff like this.  These stats were casually re-tweeted around the #socent community - in a similar way to how Umbrellagate seemed to be dismissed as an irrational attack on the sector by someone who just doesn't get it.   

I hope my commitment to writing about social business, week in, week out, demonstrates my enthusiasm for finding entrepreneurial ways to change society.  I congratulate any social business which is growing in terms of turnover, profit and impact. However, I question whether the selective (see note in italics above) use of statistics, which in my opinion prove very little, are helpful as we try to create bigger and better social businesses.  

By the way, I haven't been in touch with the SE100 people to discuss this - I'll send this post to them and will happily correct any factual errors - and obviously they can tell their story by leaving a comment below. 

Future-proof housing

You may remember that our house is currently up for sale.  We had our first offer today, a good way below the asking price, but it's a start.  Whilst the market is still unrecognisable from when we bought this house, it certainly seems to be picking up a bit.  Three viewings a week so far isn't bad at all.

The bigger problem will be finding somewhere else to live. It doesn't feel like a smart move to take on a load of debt at a time when the economy still feels very wobbly.  Add to that the fact that I'm a freelancer, and you start to think that you should have just stayed were you were - in a nice house with a big dent taken out of the mortgage.  But like many people, our first house was never meant to be our last, and we feel like we want to move. 

But where to?  And to what kind of house?  I hope I'm not boring you with my damascene conversion to the deep green cause, post Age of Stupid.  But we have no choice now than to consider  our biggest financial decision to date in the context of a planet that is heating up, and an economic system that needs to cool down.  

As I mentioned in yesterday's post I've been wandering round the house with the energy use monitor, seeing where there's scope to save some electricity.  There's some room for manoeuvre - the tumble drier and the dishwasher are the two obvious ones - but to be honest other than that we've probably done most of the simple-ish things, that will probably get us to our initial 10% cut target - or perhaps beyond.

To get beyond that, it feels like we'd need a lifestyle that is very much different to the one we have now.  What are the implications of that in terms of housing?  At the moment we're looking at 3 bedroom semi or terraced houses.  A couple of years ago we pictured ourselves moving up the ladder to a bigger house.  But now we ask ourselves, why?  For the odd occasion that family come up, or to make Francis's future sleepovers a bit more comfortable?  Or because that's just what you do as you get older and move up the ladder?  

We'll see what happens.  The house we're going to see tonight is marketed at the "downsizing couple" - but it's in a much nicer area than where we are in now - nicer parks, shops, pubs etc.  It's really not that small - but it's smaller than most houses in that particular leafy area, where most houses are pretty big and more expensive.  Perhaps it won't just be couples with an empty nest who'll need to think of downsizing in the future.  

But of course, for us, this won't be downsizing, it'll be staying the same - traditional 3 bedroom brick built house.  Which, if we need an 80% cut in emissions, isn't likely to do the planet many favours.  

I accept that our "problem" is caused by relative affluence - and is a problem that many people will never have the opportunity to face. I also want to be realistic and not too hairshirty about this - we all want somewhere nice to live and it's clearly not realistic to knock down most of the current housing stock and start again with smaller straw-bale constructions.   Yet when I read about co-housing in the paper this weekend - then read about this new scheme which is being launched in Leeds, it felt pretty clear that the way many of us will need to live in the future will be a lot different to what most of us aspire to now.  

Turning things on and off again

I've invested part of my £100 bloggers circle prize in a few things that can help me to reduce my energy use at home (and at work - given that I work from home).

I bought an OWL Wireless Electricity Monitor, for about £30.  It arrived today (on a Sunday - it seems there's no time to lose when the planet needs saving) and I've been playing about with it this afternoon.

On one level, it doesn't tell you much that you wouldn't have guessed already.  You won't need telling that the old fashioned bulb that seems to have gone on for years in your attic costs a load more than a nice new low- energy light.  Or that the tumble drier costs a small fortune to dry your smalls in time for work tomorrow.

But there is something quite powerful about seeing the impact of turning something on or off.  An impact measured in pounds and pence, or CO2 emissions if you prefer.

Things I've discovered on my walk round the house (and I accept none of this is big news):

• Old fashioned bulbs use a surprising amount of electricity - changing them is a no-brainer
• The oven's electricity consumption varies - loads of electricity to get it to the required temperature - and surges to keep it hot - which makes me think about not using it for that 8 minute warm-up of a part-baked baguette (and sorting out that faulty seal).
• The flat screen TV is as bad as expected (my excuse is that it's a hand-me-down telly)
• The heater I use for heating the office when I don't want to heat the whole house uses more energy than the oven or tumble drier.

Other first reflections: 

• Why are electricity bills so unbelievably complicated to decipher?
• Why aren't electricity companies compelled to do more to encourage us to look at this kind of thing?
• I still don't know about gas consumption - eg is it better to put the central heating on, instead of the electric heater?

And finally, it just makes it so abundantly clear that whilst we may feel paralysed in the face of climate change, there are things that we could all do to make a bit of a difference.  Could you monitor your electricity usage at home?  At work?  Might it be worth buying one of these things - and sharing it with friends?

State of Interdependence

Lots going around my head this morning but not much time to write.  Given that there's lots going round my head this may not be the most coherent post, but here goes.

I'd like to point you to a couple of interesting blog posts from the RSA.  In the first, from Matthew Taylor, he describes himself as "an enthusiastic collectivist but a reluctant statist."  It's a neat phrase, which I think also gives a good idea of my position too.  

One of the myths of affluence (or at least one that I've swallowed) is that greater wealth can lead to greater independence.  You basically don't have to worry too much about things as long as you've got a good bit of cash to buy your way through life. You can buy your independence - and, it's assumed - your happiness and wellbeing.  

In thinking more about climate change over the last few months, it's struck me that if we are going to build an economy and society which have any chance of survival, we need to better recognise our interdependence. That's true on a global scale - but also on a local scale.  We won't be able to change things on our own. Hence my interest in the collective - but my scepticism about the role of the state.  

Following on from this I found this post from the RSA Connected Communities blog interesting.  The post looks at community responses to climate change, and includes this quote from an RSA Fellow:

The future is certainly looking ominous. But I have experiences that when you join together with others to do something about it, something extraordinary starts to happen. You might start with something that seems small or insignificant in the face of the huge scale changes that are needed, with “ordinary” people, not experts, and no idea how to begin. But in the process, such groups can come up with really robust ideas and initatiatives that start things moving and create a momentum that gradually infects the wider community.” 

It made me think again about the Borrowed Planet group I'm part of, and also about Progress School, where I'm going this afternoon.  Should my aim in life be to become independent?  Or happily interdependent with others?  And does the State have a role in helping me and others to be happily interdependent?

Habit forming and 10:10

We had a Borrowed Planet meeting at our house last night.  We're a group of parents who have decided to get together to take action on climate change.  

Last night we agreed to join the 10:10 campaign as a group.  We went through their checklist of things to consider - to see what we each could do.

It was interesting to reflect on what we've tried to do differently as a family over the last few months, since we launched the group with a screening of The Age of Stupid.

A lot of it has been about getting out of habits that we've just fallen into over the years.  We haven't always had a car - for a while we we shared a car with a couple of other families - but in the four years since Francis was born we'd pretty much fallen into the habit of using the car for most journeys. 

Since July we've tried to change that.  Most weekday journeys are to take Francis to and from nursery - and I'd say over the last three months he's gone on my bike around half the time, the bus a quarter of the time, and the car a quarter of the time.  That's a big shift - and I'm now in the habit of thinking first of the bike, then of public transport, then the car.  

Another big area for us is food.  Like a lot of people we waste too much food.  That's been a harder nut to crack, but again, by being aware of it, sorting out the cupboards and fridge, and planning meals a bit more, we're making progress.  There's still a way to go on that one, but we've made a start.  I've also been challenged on the unsustainability of my meat eating habit - and have just bought a book that was recommended to me, Diet for A Small Planet.  I don't think we'll become vegetarians again, but we need to cut down on the amount of meat we eat, because if everyone ate the amount of meat we eat, we'd be in trouble.  

The next area we're looking at as a group is energy consumption.  We'll each monitor our gas and electric usage in November, to see how we compare.  I'm going to use my prize from the Bloggers Circle to buy an energy use monitor which we can all use too.  

They're all small steps, which won't stop runaway climate change on their own.  But I think one of the main barriers to changing things is a sense of paralysis - not knowing what to do in the face of such a massive problem.  That's why I think that starting to make changes, starting to form new habits, are important first steps.  

Bananas and the cult of the ASDA Shopper

For a while I was pretty much obsessed with bananas.  One of my proudest moments was when I was accused by the Fresh Produce Buyer at Asda (I was working at their HQ at the time) of "revolutionary activity", after I put a notice on the ASDA intranet about a World Development Movement campaign about poor conditions at Chiquita banana plantations.  "Remember what pays your wages" was the buyer's stern warning. 

Some things have changed with time - that conversation was 12 years ago.  In another email exchange with a buyer I was told in no uncertain terms that "The Asda Shopper will never buy Organic."  

Yet some other things don't change.  There was a good piece in the Guardian on Monday by Felicity Lawrence (thanks to Cliff Southcombe for pointing me to it) about the current banana supermarket price war.  It happens fairly often, particularly as bananas tend to be supermarkets' biggest selling line (as the produce buyer pointed out to me all those years ago) - and because they are a Known Value Item - people tend to be aware of how much bananas cost - in a way that they're not so aware of the price of dried borlotti beans.  

I lived in Guayaquil for a year, the port through which most of Ecuador's banana exports pass.  Whenever I travelled to the capital, Quito, I would bump along a pot-holed road through miles and miles of banana plantations, stretching way into the distance. It was an awe-inspiring sight.  

These bananas were dollar bananas - grown on plantations where conditions are regularly denounced as poor - low wages, lack of union recognition, regular use of pesticides etc etc.  It's this kind of industrial agriculture which allows supermarkets like ASDA/Wal-Mart to negotiate really low prices.

Of course ASDA will claim that this is in the interests of the ASDA Shopper.  In my years at Asda House the cult of the ASDA Shopper was something to behold.  There was no shrine in the atrium, but there might as well have been.    Of course any business should be focused on serving its customers, but I don't accept the supermarkets' regular assertions that they are just giving hard-pressed consumers what they want.  This one-dimensional argument is naive, ignores the social responsibilities of business, and is designed to deflect attention from a private company's primary purpose - to maximise profit for shareholders.  

ASDA have responded to Felicity Lawrence's article - with this letter from Alex Brown, their Produce Director.  I'm intrigued by this line:

"The reason we're able to offer the lowest prices is simple:  because we cut unnecessary cost out of our business and pass it on.  That's not because we're squeezing suppliers or trading unethically, it's just because we don't waste money."

One of the core values when I worked at ASDA - I assume it's still the same - was "We hate waste of any kind."  It's a good value - and that's why I can believe that they work incredibly hard to cut costs out of their business.  But am I supposed to swallow the line that they don't squeeze suppliers?  

I'd like to know whether Alex Brown has visited any of the plantations which supply ASDA, or whether he's considered the impact that a banana price war can have on other producers in this market.  If he can't afford the time to go to Ecuador, he could, as Felicity Lawrence suggests,  just take a look at the UK's diminishing dairy industry - and perhaps look a few dairy farmers in the eye and tell them that he's only doing what the ASDA Shopper wants.  

How can we change the world? Try dancing.

I'm back at work today after a few days in London.  We had a great time - Francis loved the dinosaurs at the British Museum and the view from the London Eye.  He also sang "I got soul, but I'm not a soldier" to one of the Guards on Horseguard's Parade, which I thought was an interesting move.  

I'm bowled over by the energy of London - so much going on.  One thing that I didn't know was happening - no reason why I should - was Powershift 09 - a UK Youth Climate Coalition Event to bring together a load of young people around the theme of climate change.

The weekend culminated in a Powershift Flashdance - below the London Eye.  I'm gutted we missed it - by the looks of things they were wrapping up just as we were arriving to go on the Eye.  But I've just watched it here on video.  You can also read what the Guardian thought about it here.  

POWERSHIFT LONDON FLASHDANCE! from Adam Tyler on Vimeo.

A few bloggers from the Bloggers Circle are currently debating what we can do about climate change. The general feeling is one of resignation.  Why aren't people more angry? asks Patrick Hadfield.  Gingerbreadgirl wonders what she can do to have an impact.  I've written a fair bit about similar concerns - I know I want to do more - I'm just not sure what.  

How on earth is a five minute flashdance in the middle of London going to change anything?  It's a good question, and I'm not wholly sure why I think it will.  But I think it's just about the best action on this subject that I've seen.  Watch the video and look at the enthusiasm on the faces of the dancers.  Imagine the movement that has taken shape over their long weekend together.  How they'll each have gone home yesterday, fired up, ready to change things back at school, university, church or wherever.  

The most optimistic I've ever felt about the world was when I worked in Ecuador for a youth development charity.  We ran 3 month training courses - a 50:50 split between practical skills (IT, English etc) and personal development stuff - including lots about taking action in your community to make things better.  We finished every course with a residential - probably a bit like what they did here.  I was young myself at the time (they were the days) and they were an incredible experience.  

A flashdance isn't going to sort out the problems we face.  But the energetic, focused tribe of young people that is created around the dance may just help us to sort things out.   

Light Night Leeds

Not long back from Light Night Leeds - a whole host of art and cultural events across the city - in venues which would usually be closed at night.  I went with Francis and a couple of friends and their kids so we didn't stay late - but we still got round a few venues.  Here's a taste of what we got up to:

I think there were about 100 different things going on - we also saw some Irish dancing, listened to some people on a soapbox in the middle of Hyde Park in the pouring rain whilst the kids re-arranged the carefully- arranged lighting, and also played with light sticks in the dark.  

What I liked was seeing the city in a different way.  I've written before about how I find Leeds a difficult city to love.  I've been here 18 years now and I'm still ambivalent about the place.  

I find myself increasingly drawn to things like this.  I'm certainly not alone - I was amazed how many people were at each of the events we went to this evening.  I think there's a new hunger  - people searching for meaning in their lives, in their cities, beyond consumerism.  It may not all have been to everyone's taste, but Leeds is a much better place for hosting events like Light Night.  Slowly, slowly, I may be learning to love the place.  

And the award goes to...

Just been to have a look round a local primary school - Francis will start school next year.  

It was OK - but pretty uninspiring.  I'm not sure what I expected - obviously I haven't been in a primary school for 30 years - but I did want to be inspired.  Not by the stats about attainment or anything like that, but by the feel of the place, a sense of purpose.

I came prepared with a list of questions. Mostly the Head responded with talk of this Award that they've got, that Initiative that they're part of, this Programme that they follow.  Healthy Schools, Creative Schools, Green Schools, and god knows what else. Good tick box answers. Perhaps that was shorthand for telling me that they're doing OK, but I'm a bit sceptical about all that stuff.   

Does it really make the school a better place?  Or is that kind of thing a top-down initiative which raises the profile of a particular issue for a while, but doesn't really change things for the better in the long term.  The overgrown garden - no doubt a thriving mini-allotment when the funding was there two years ago - suggests that I'm not completely wrong.

As I mentioned a couple of weeks back we're hoping to move house this year - so may not go to that school after all.  But will it be the same wherever we go?  All the boxes ticked, all the certificates on the wall, but something special missing.  

The state must become a smarter shopper

I've got a short piece in today's Guardian  - they asked me to write a piece in response to their  A New Public Services feature last week.  Here's my piece - and here are the rest of the responses.