A Golden Decade of Social Enterprise in Taiwan the Silent Revolution
What does a decade mean to you? The time you spend from starting your university student life to acquiring your doctorate? The years of youth when an eighteen-year-old girl becomes an experienced woman? Or the adventure of starting a new business from scratch? In fact, social enterprises in Taiwan started to take root and grow approximately ten years ago.
After a decade, social enterprises have become a prominent industry in Taiwan, and have developed new models for solving a great variety of social problems. Now is the time for us to take a look at how social enterprises have grown from a small grassroots revolution into an important agenda of concern to the whole nation.
2007：The year that the social enterprise concept arrived in Taiwan
These valuable attempts to solve social problems served as an important foundation for the further development of social enterprises in Taiwan. Unfortunately, at the time, academic and charitable organisations were increasing in number, which limited the donation growth of social enterprises. Facing a situation of stretched resources, as well as a lack of sustainable finances, this impacted the effectiveness with which they could solve social problems.
In the year 2007, Flow Inc., the first venture capital firm related to social enterprises (established by the founder of Trend Micro, Steve Chang, and novelist Tom Wang) officially introduced the term “social enterprise” to Taiwan. During that year, it attracted more than 212 social enterprise proposals. This first step taken by Flow Inc. gave Taiwanese people the opportunity to understand social enterprises in a concrete way.
Several representative start-ups that are still active in the field of social enterprises, such as B Current Impact Investment Inc., ELIV and Social Enterprise Insights, were inspired by Flow Inc. to strive for prosperity. Even though Flow Inc. is no longer engaged with venture capital, it still has a certain degree of epochal significance as the pioneer who first tried to create an environment for the development of social enterprises in Taiwan.
2012：From ideas to practice, entrepreneurs translate ideals into output value
However, Taiwanese people were still unfamiliar with the idea of “social enterprises” back then and the environment for social entrepreneurship was not ripe enough to be free of resource and funds scarcity. As a result, social enterprises founded in the five years after 2007, such as the Rejoice Community Supported Agriculture Group, ELIV, Greenvines, Okogreen, Aurora Social Enterprise, Duofu, etc, all invested enormous efforts into building sustainable business models which would translate social ideas into the output value.
Among those, Okogreen and Duofu even registered for the TPEx Emerging Stock Board, directly raising their funds from investors on the capital market. Greenvines also acquired B Corporation certification, which showed that social enterprises were also capable of providing competitive goods and services.
At the same time, social enterprises focused on media, such as New Talk, News & Market and Social Enterprise Insights started to emerge. It is worth mentioning that Social Enterprise Insights is more innovation-oriented than other websites focusing on news reports. In addition to establishing the first online platform dedicated to information about social enterprises in the sinophone world, it also introduces all sorts of cases related to innovation and entrepreneurial incubation around the world, thereby opening a window through which sinophone societies can glimpse how social enterprises are developing in the global scene.
Either by enhancing their own competitiveness or introducing information from other countries, entrepreneurs have endeavoured to lay the foundations for the further development of social enterprises in Taiwan and have fostered the ability to integrate resources. Therefore, such brave explorations of how social enterprises could improve Taiwanese society in a period that lacked relevant resources have become models that not only show us an experimental spirit but are also devoted to strengthening the influence of social enterprises in different fields to this day.
2016：From entrepreneurship to industry, policies that move towards a new era
The international situation is also a key factor that has determined the development of Taiwanese social enterprises. After the global financial crisis in 2008, a collective belief in profit maximization was overthrown. Not just in Europe and the United States, but also in Asian countries such as South Korea, Hong Kong and Singapore, a brake had been put on crazy capitalist development, and the purpose and value of business operations was rethought.
This financial storm aroused a desire for change, and values started to shift to a new territory, culminating in the emergence and popularization of social enterprises that balance social goals with economic purposes.
At that time, numerous problems faced Taiwan, such as a high unemployment rate in the wake of the financial crisis, low satisfaction with the government, food adulteration scandals, and many accidents endangering public safety. Besieged by domestic and international problems, Taiwanese social enterprises managed to find conspicuous points at which to enter mainstream public discourse and gradually attract attention from all walks of life.
Even though, after six years, Taiwan is still faced with all sorts of social problems waiting to be solved, social enterprises dedicated to different issues continue to sprout up. In order to respond to social needs, the Taiwanese government proposed an “administration first, legislation later” policy, which was advocated by the then Minister without Portfolio Feng Yan. This policy included making the year 2014 the “First Year of Social Enterprises” and putting 160 million Taiwanese dollars into a budget for a three-year-long “Social Enterprise Action Program”, which lasted from 2014 to 2016 and encouraged Taiwanese social enterprises to work towards diversified development. This period was also the time when the number of social enterprises grew most rapidly in national history.
Remembering this period, Feng Yan said with certainty,“The three most important things over the past three years have been, first, turning over the entire plan to the management of the Ministry of Economic Affairs in order to allow the whole industry to grow and be seen. Second was letting social enterprises freely develop through an “administration first, legislation later” method. Third was establishing the foundation of an ecosystem for social enterprises.” Indeed, by this time, the environment for social enterprises had already dramatically improved like never before. Social enterprises originally started from a few individual entrepreneurial attempts, before a whole “industry” was later identified and supported by government policies. All kinds of ideas beneficial to the development of social enterprises were incorporated one after another into political agendas by candidates during the 2016 presidential and legislative election campaigns. At this point, social enterprises had officially become a key issue that could not be ignored nationwide.
As social enterprises continued prospering in the non-governmental space, the government was also trying to keep up with the trend of development. After the Democratic Progressive Party came into power in 2016, the responsibility for delivering policies related to social enterprises was given to the newly seated Digital Minister Audrey Tang, who built a “vTaiwan” forum for the development of social enterprises. Since her assumption of the office, government policies on social enterprises have moved again towards a new era, advancing original “policies” into a more open, more transparent public policy discourse named “Talk to Taiwan”. As mentioned by Audrey Tang, it is expected that the concept of “open government” will allow future governments to adopt more of the public’s opinions in its agenda-setting and give young people more opportunities to participate in the formulation of national policies.
2017：From niche to mainstream, from social enterprises to social innovations
Retrospectively, it is clear that a time as short as a decade can be deeply influential.
According to government statistics, before the end of October 2016, there were a total of 118 companies, not including the already dissolved ones, registered with “social enterprise” in their names. If we widen the scope of research to organisations related to information collection in the social enterprise industry, including the Registration Platform for Companies and Social Enterprises (the management of which was delegated to the Taiwan NPO Self-Regulation Alliance by the Small and Medium Enterprise Administration, Ministry of Economic Affairs), the Social Enterprise Hub (the management of which was delegated to Okogreen by the Small and Medium Enterprise Administration, Ministry of Economic Affairs), Government Resource Counselling, the Social Enterprise Incubation Project delivered by Social Enterprise Insights, and news coverage, the preliminary number of social enterprises would as many as 450.
The industry scale of social enterprises could grow to today’s level simply because many enterprises were not afraid to challenge both small and big problems, and, by doing so, created a memorable history. For example, the first venture capital firm and first sinophone information platform related to social enterprises, the first social enterprises listed on the TPEx Emerging Stock Board, the first social entrepreneurs to become civil servants, and the importance of social enterprises being recognized in administration and legislation, saw that many new derivative cases of social innovation were no longer limited to being “social enterprises”.
From ancient times to the present, all revolutions have begun with a small group of people who were not satisfied with the status quo. After the effects of the movements were expanded and amplified, they would eventually merge with the public to form an influential collective awareness. Taiwanese social enterprises are no exceptions. In the blink of an eye, they have ascended from a “small revolution” to becoming the ultimate expectation that the public has for corporations.
We believe that Taiwanese social enterprises will keep moving forward, constantly challenging the status quo and creating history.