Social innovation in business- what is it and why it matters

I’ve been busy writing a booklet on social innovation. Social innovation can be defined as the introduction of new products or services that help meet our society’s social and environmental challenges. It is emerging as a promising new way to bridge non-profits, government agencies and business actors. Through social innovation, the polarization between business and non-profits fades away.

Most of the literature on social innovation comes from social actors who are exploring ways to enterprise non-profits, improve public service or create small social businesses to address local needs. I come at the subject from a business perspective. What role can and should business play to address our social problems, how can they partner with non-profits and public authorities and help identify and scale-up social innovation?

The benefits to business of investing in social innovation are numerous:

1. It is a source of innovation- helping identify and launch new products and services to existing or new markets.
2. It increases employee motivation and engagement- people like to work on meaningful projects.
3. It is a source of social capital- it builds reputational resilience.
4. It helps manage risk at a corporate level- reputational risk, for example, can be greatly reduced through activities that have positive social impact.
5. It can contribute to reducing the use of resources- by identifying new ways of reducing, recycling and re-using resources, companies can reduce their environmental footprint and make a measurable impact on the bottom line.
6. It can help brand the company in a positive way- think of The Body Shop, Patagonia or Mountain Equipment Coop. All these organizations have stellar brand images, thanks to a commitment to innovation and environmental sustainability.

I would love to hear your comments or suggestions on how social innovation can be applied in a business world.