Fake social profit projects... buyer beware!
As the CEO and trustee director of a small social enterprise that makes a great product which is sold through a customer-focused revenue-generating model, I am increasingly concerned at the rise of the ‘fake social enterprise’.
I was recently made aware of another company who – on the face of it – are not too different from us. Competitors perhaps. And they use the words 'social project' by association.
Lets call them 'mrfakesocialproject.com'.
Our own business is a social enterprise, a Limited by guarantee business, registered at Companies House and for VAT. We are the first (and to the best of our knowledge) the only social enterprise flag maker in the UK, Europe and World and we’re proud of what we do and what we’ve achieved. We’ve won awards, won contracts, won the confidence of our social mission beneficiaries and our clients, changed lives through our skills and rehabilitation programme of training and we just love what we do.
So what sort of business passes itself off as something it patently is not. What sort of business owner pretends to do something for the social good, when there's no apparent benefit to society other than self.....? As with handbags it seems, those with no imagination of their own are increasingly passing themselves off as something they are not, to cash in on any goodwill to be generated from a great idea. I’m beginning to understand how Versace must feel when they see their ideas, products and branding cheapened by rip offs, fakes and market stall prices.
Price wars and product quality aside, surely climbing on the social enterprise bandwagon without a genuine social mission at heart is fundamentally wrong….?
Salesforce.com trademark dispute
In 2012 Social Enterprise UK ran the 'Not In Our Name' campaign against Salesforce.com, a global software and CRM company, that had begun using the term 'social enterprise' to describe its products and had applied for 'social enterprise' trademarks in the EU, US, Australia, and Jamaica.
The campaign was supported by similar organisations in the US (the Social Enterprise Alliance), Canada, South Africa, and Australia. An open letter was sent to the CEO and Chairman of Salesforce.com asking Salesforce.com to stop using the term 'social enterprise'. It was signed by people and organisations around the world, including Muhammad Yunus (Grameen Bank founder and Nobel Peace Prize laureate), Richard G Wilkinson and Kate Pickett (co-authors of The Spirit Level.
Salesforce agreed to withdraw applications to trademark the term 'social enterprise' and remove any references to 'social enterprise' in its marketing materials.
Three years into my social enterprise journey I personally still have so very much to learn about living, breathing and being a social enterprise and frankly, I’m affronted by fakery. Shocked actually.
This attitude, this theft of valid ideas and effort, undermines real positives about social enterprise and those working on the ground in the sector. The fact that this fakery is actually happening reflects a hitherto unfortunate systemic failure and pressing need to recognise social enterprises as singular legal entities and empower them to stop despicable individuals to get away with fraud.
In social enterprises, even wholly not-for-profit businesses like ours, where directors and staff are usually paid little or less than they are generally worth on the open market, if paid at all, the mixing of a commercial approach and social motivation simply confounds those who haven't yet grasped the opportunity of CSR. In the context of an ill-defined, and little-understood model, those of us who run social enterprises for the love of what may not be necessarily understood by the great unwashed – I mean, who in their right mind works for so little, right? – we do work hard to make real social change, one person, one beneficiary at a time.
Why would someone want to masquerade as a social enterprise?
There's no doubt about it, social enterprises and the way that profits are prioritised and invested for social good are a viable business model - in my opinion and experience - to stand by. Its a great idea.
So why set about to copy and undermine a similar business in a similar location and draw attention, sales and money away from that legitimate social enterprise?
Perhaps it’s a means to apply and receive huge sums out of public sector contracts. Perhaps its because ‘fake.com’ is a failing business and dishonest tactics are the only way they can take to try and survive.
It is demoralising and depressing that this is happening already when the sector is comparatively still so new. I honestly hope that by collaborating and working in partnership, social enterprises, consumers, honest brokers of the social enterprise sector and those in public office will be able to maximise the social impact potential, and cut off those unscrupulous dishonest ‘fake social’ enterprises before they gain any headway.
Perhaps it’s a sign of the start of surreptitious attacks on the social sector – after all where there’s smoke….?
In the meantime, if you're buying flags, bags or anything - check the credentials of those who say they are a ‘social project’ before you buy from them. Better safe than sorry. Better make sure your money makes a difference.