Comments on: Socially responsible responsible startups are increasingly important

By: lsywlw00

lsywlw00 — Fri, 27 Nov 2009 01:59:31 +0000

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By: brisbourne

brisbourne — Mon, 16 Nov 2009 08:04:46 +0000

Fair point, I guess they should. That said, government and the tax system is a reasonably efficient mechanism by which all businesses contribute to society and their local community.

By: Dimitri Inglezos

Dimitri Inglezos — Mon, 16 Nov 2009 07:57:42 +0000

I can see your point Nic. However I think there is a case to be made that even those companies should embrace social responsibility actions, perhaps through contributing to their local communities.

By: brisbourne

brisbourne — Fri, 13 Nov 2009 13:29:38 +0000

All businesses should act with integrity, but I don't think all businesses can realistically aim to be socially responsible through and through. Think about a gun manufacturer or brewer.

By: DInglezos

DInglezos — Thu, 12 Nov 2009 19:05:02 +0000

However don't you think that all businesses should have some ethical values and be sociallly responsible?

Some large corporations did that when they were starting so I don't see why this can't be done now with any SBE. I believe that the VC's too could incorporate some ethical practices and social responsibility elements in each business they invest, without affecting their returns.

As Rod rightly mentions people like buying from a company like this and they also love to work for one. Aren't these the basic cornerstones of a succesful business ?

At the end of the day shouldn't we make a distinction between a business and a charity ? Because in my mind 'socially -responsible' business is a business that provides a win-win solution. Win for the entrepreneur and Win for the society.

By: brisbourne

brisbourne — Thu, 12 Nov 2009 10:18:20 +0000

Thanks Chris, nicely put.

By: chrispadfield

chrispadfield — Thu, 12 Nov 2009 10:12:48 +0000

Interesting post. There is perhaps a false dichtomy between returns and social benefits. Body Shop was arguably successful because of it's social policy – it didn't sacrifice returns for social benefits, but instead generated its returns at least somewhat because of the social values it effectivly reflected in its brand. I'd argue Innocent is another example of a company that has navigated this path well and has now taken a stake from the traditional company in the market. I think VCs will stick with these types of companies – where the social benefits are a key part of the brand. Consumers are clearly prepared to pay more for products from companies with these values – but probably even more important is that the best employees choose to work at the companies with these values. There will be angels and specalist VCs that might look at the types of companies that pick companies where the returns will be lower – the VCs will probably be publically funded and angels will have their own motivations. But traditional VCs and angels will be best served by picking companies where the social benefits the company generates increase the returns as opposed to it being a tradeoff.

By: brisbourne

brisbourne — Thu, 12 Nov 2009 08:44:34 +0000

I agree the distinction is difficult for some, but not sufficiently difficult that it has stopped WordPress and others being successful.

I guess the key will be balancing the commercial and social objectives.

By: Nicholas Lovell

Nicholas Lovell — Thu, 12 Nov 2009 08:21:59 +0000

I see some challenges with the socially-responsible business - which is that for many people "socially-responsible" and "business" can't go together.

Taking a different example, I was at a developer conference talking about the advantages of OpenSource and was being particularly positive about Wordpress (which powers Gamesbrief). The people I was talking to said "that's not really open source. It's a big business and the founders are millionaires."

I tried to argue that what mattered was that anyone could choose to use the software, with full function, for free, and if the founders were able to make money through consultancy and hosting services, that's great, but my interlocutors were adamant: it can't be open source if it makes someone rich.

Granted, they were academics, but still. It made me wonder if, in the public mind, socially-responsible and business are words that belong together.