Britain has announced plans to give more business to firms that have a positive social impact, as it seeks to cement its status as a global leader in the growing sector, but experts said the strategy did not go far enough.

The government said it wanted to work more closely with charities and social enterprises – businesses that seek to do good as well as make a profit – to create a fairer society.

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“This strategy is intended to help government strengthen the organisations, large and small, which hold our society together,” said the first plan of action focusing on civil society in 15 years.

“Together we can build a country that works for everyone.”

Social services, from health to transport, are increasingly being outsourced to private companies to save money and boost innovation, with a third of government spending going to external suppliers, government data shows.

The government said it will help social enterprises win more public sector contracts by boosting a landmark 2012 law, which encourages officials to consider the social and environmental impact of contracts they award, not just choosing the low bid.

“We are determined to ensure that public spending is used to generate social value in addition to the goods and services it purchases,” the strategy said, adding that businesses should benefit society, not just their shareholders.

Britain is seen as a global leader in the innovative social enterprise sector, with about 70,000 businesses employing nearly 1 million people last year, according to Social Enterprise UK.

But social enterprises only win about 10 percent of public sector contracts, says membership body Social Enterprise UK.

The new strategy comes amid years of budget cuts, which have strained social services, and questions over the rising use of private companies to deliver them, following the collapse of one major provider, the construction giant Carillion.

Social enterprise experts welcomed plans to boost the 2012 Social Value Act so that central government must ‘account for’ – in other words, report on – the social impact of procurements, rather than just ‘consider’ it.

But this should also be extended to local government, Andrew O’Brien, a director Social Enterprise UK, told the Thomson Reuters Foundation.

He also expressed cautious optimism about plans to create a regular forum for social enterprises to meet with government, saying it could make it easier to learn about initiatives to help the sector.

“We want this to be something that has real substance to it. We don’t this to just be a talking shop,” he said.

By Lee Mannion

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From pioneering programs in slum housing to mobile phone banking, Santiago and Nairobi are emerging hot spots for business leaders seeking to drive social change, according to a poll of experts on the best countries for social entrepreneurs.

Berlin, London and Hong Kong were named as major hot spots for social entrepreneurs in the Thomson Reuters Foundation poll of nearly 900 experts in the 45 biggest economies.

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But, more surprisingly, the capitals of Chile and Kenya were also pinpointed as two of the five most exciting places for business leaders wanting to have a social impact.
Stephanie Koczela, co-founder of Nairobi-based Penda Health, a for-profit medical clinic group, said in richer countries, like the United States, people often ignored or dismissed social issues and enterprises but poorer nations saw the impact.

“In Nairobi, they want to learn more and help to drive change… Communities here are invested in social enterprises because they understand that they are striving to make the city a better place,” Koczela told the Thomson Reuters Foundation.

East Africa is one of the global centres of impact investing – the fledgling market in investing for social good – according to a report by the Global Impact Investing Network (GIIN).

This followed a major success in innovation by Kenya’s biggest communications operator, Safaricom, which pioneered a mobile money service called M-Pesa in 2007 that allows Kenyans to pay bills or receive funds on the simplest of mobile phones, giving people a new way of accessing banking.

M-Pesa, which swept across the country and has been mimicked across Africa, ignited interest from foreign investors in Kenya as an emerging hub of tech and innovation, entrepreneurs say.

“Kenyans are receptive to new ideas, those which want to make a difference. Nairobi is a good city to test innovations,” said Kenyan social entrepreneur Fredrick Ouko, the founder of Riziki Source, a mobile phone app for disabled job seekers.

With English as its main language and rising numbers of socially-minded university graduates, Nairobi has established itself as a hub for social entrepreneurs.

But, like in many other countries, there is no formal recognition for the sector, depriving it of potential investment and incentives like tax breaks, experts said.

Access to finance remains the major challenge, according to Ashoka, a global network of social enterprises.

“Attracting capital and funding is especially difficult for social entrepreneurs in Nairobi, because investors tend to turn to regular businesses for quicker and bigger returns,” said Peris Wakesho, Ashoka’s regional director for East Africa.

In Chile, social entrepreneurs also found it hard to access investment but did receive support from the government which has fuelled the recent, fast-growing trend in social enterprises in and outside Santiago, experts say.

Chile’s leading social entrepreneurs say access to government funding, the role of universities, a pool of well-educated Chileans, media interest and good internet connection have all helped make Santiago a hotbed for social entrepreneurs.

They said TECHO, a Santiago-based non-profit organisation that tackles poverty and housing in slums, played a key role in raising awareness about doing social good after its 1997 set-up.

TECHO, with a large network of young volunteers and now one of the largest non-governmental organisations (NGOs) in Latin America, has served as a platform to launch future leading social entrepreneurs and enterprises.

The Thomson Reuters Foundation poll, conducted in partnership with Deutsche Bank, the Global Social Entrepreneurship Network (GSEN) and UnLtd, the foundations for social entrepreneurs, found Chile came fifth in the ranking of nations where conditions favour social entrepreneurs.

The poll found Chile was the joint third best with France, behind only South Korea and Singapore, for the country where government policy supports social entrepreneurs.

“I’m amazed a lot by how Chile has developed in the last six to 10 years. Just five years ago, most people didn’t understand the concept of social entrepreneurship,” said Maria Jose Montero, head of Chile’s first Impact Investment Fund which raises funds for non-profit and for-profit social enterprises.

Santiago hosts the annual International Festival of Social Innovation, now in its fourth year.

Government programmes offer selected local and foreign entrepreneurs, mainly in the tech business, some equity-free funding, co-working office spaces and mentoring opportunities.

Sebastian Salinas, a Chilean social entrepreneur who co-founded Balloon Chile to support and train local entrepreneurs in rural areas to develop their businesses, said government support had been important for the growth of the sector.

“You can raise money through central and local government funds and each region in Chile has its own competitions and sources of funding for social entrepreneurship,” said Salinas.

By Anastasia Moloney and Kieran Guilbert.

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When a South African Airways Boeing 737 took off from O.R. Tambo International Airport in Johannesburg two years ago, headed for Cape Town, it was powered by an unusual fuel: tobacco.

South Africa hasn’t yet repeated the jet biofuel feat, but in an effort to cut its climate-changing emissions and promote greener power the country’s researchers are looking for innovative ways to manufacture green aviation fuel at larger scale.

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A new “Waste to Wing” project aims to one day produce a significant share of the country’s aviation fuel from waste plants, including invasive species.

“South Africa produces a large amount of agricultural waste, as well as waste from plantation forestry and waste biomass from alien vegetation clearing programmes,” said Tjasa Bole-Rentel, an energy economics and policy specialist for the World Wide Fund for Nature (WWF), one of the groups involved in the biofuel push.

So far the effort is a small “proof of concept” project, likely to produce just enough jet biofuel for one more flight, she said.

But if the technology works, production could be scaled up significantly – perhaps to as much as 15 percent of the aviation fuel used at Johannesburg’s international airport, she said.

Finding clean fuel for planes, ships and other forms of transport hard to plug into a clean energy grid remains one of the biggest challenges for reducing climate changing emissions.

But as airlines face increasing pressure to become more sustainable, countries around the world are trying to find solutions, from hydrogen powered barges to, in South Africa’s case, planes that could fly on weeds.

Scaling up jet biofuel – and making it cost effective – hasn’t been easy, however.

TOO EXPENSIVE?

Farmers in South Africa’s Limpopo province today continue growing solaris, a nicotine-free tobacco that produces large amounts of oil and that was used as a feedstock for the country’s first tobacco-powered flight.

But “there is no local refining capacity available and the sheer scale of farming needed to make the economies of scale work at this moment in time” is difficult, Merel Laroy, a spokesman for SkyNRG, a Netherlands-based alternative jet fuel supplier, told the Thomson Reuters Foundation.

One of the lessons learned, she said, is that making the biofuel locally is key.

“When there’s no local production capacity, the feedstock must be shipped out of the country and shipped back after refining. This makes the sustainable aviation fuel much more expensive,” she said.

The Waste to Wing project, with $1.4 million in funding from the European Union’s SWITCH Africa Green Programme, aims to solve that problem and cut costs and protect agricultural production and forests by using waste to create fuel.

The effort, a partnership by South African social enterprise Fetola, WWF, and SkyNRG, aims to create a clean jet fuel supply in South Africa, a country with a long history of developing and using alternative fuels.

As part of the project, 25 small businesses will collect and supply the plant matter needed to make the biofuel – an effort to create jobs in a country with one of the world’s biggest unemployment rates.

Amanda Dinan, Fetola’s project manager, said the businesses could use invasive plants, collected in environmental restoration projects and currently simply stored or abandoned, as the raw material for jet fuel.

Such stores of dried plants today can present a wildfire risk in a country suffering drought, so are often purposely burned to avoid that risk, she said.

But the waste could provide jobs “in its harvesting, collection, pre-treatment and transport,” Dinan told the Thomson Reuters Foundation.

She and Bole-Rentel said no biomass will be produced for being converted to fuel.

“As the name suggests, the Waste to Wing project will focus on waste biomass”, including leftovers from food and livestock feed production, paper making and furniture production, Bole-Rentel said.

At the moment, most of the agricultural waste produced in the country is burned, she said.

In some areas, harvested invasive plants already are being used to produce charcoal or fibrous products such as coffins, but most of the waste is unused, she said, and only that unused supply will be diverted to the jet fuel project.

PLENTIFUL SUPPLY

Bole-Rentel said the project was designed to stand up to worsening drought linked to climate change in southern Africa, and ensure food-producing land isn’t used to make fuel instead.

South Africa still has large swathes of invasive plants to clear, and the weeds are spreading faster than they can be cut back, Dinan said, which means the jet fuel project could both aid that effort and is unlikely to run out of stock to make fuel.

Sampson Mamphweli, director of the Centre for Renewable and Sustainable Energy Studies at Stellenbosch University, agreed the country has plenty of organic waste.

“Whether they use organic waste, or they plant the biomass for energy, whichever way the project is worth investigating,” he said.

One huge challenge with such projects is the cost of transporting plant waste, so material would need to be sourced as close as possible to where jet biofuel is produced, Mamphweli said.

And “the cost of the actual biomass material is also a big factor,” he said. Often, a once useless and free material becomes valuable when there is a use for it, he said.

Bole-Rentel said it was too soon to get any real picture of how much of South Africa’s aviation fuel needs might be met by the waste-to-fuel project.

But “our previous research into biomass availability suggests that, technically, there could be enough biomass to meet 100 percent of our aviation fuel demand,” she said.

But under current technology the biofuel would need to be blended with conventional jet fuel, meaning the waste technology could supply at best half of the country’s needs, she said.

By Munyaradzi Makoni, editing by Laurie Goering

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Tucked away in a mediaeval Spanish square, an unconventional restaurant is training refugees and telling their stories, hoping to change the lives of migrants and how people see them.

Espai Mescladis is both a restaurant and culinary school – and part publishing house.

It trains migrants from as far afield as Venezuela, Senegal and Pakistan to cook and cater so they have a better shot at finding jobs and integrating in Catalan life. The interns also get help with asylum paperwork, and customers get insight into what it is to be new, penniless and scared in a strange land.

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The social enterprise was founded in 2005 by Argentine entrepreneur Martin Habiague, whose interest was sparked by volunteering with a humanitarian organisation in Belgium.

“Immigration has always interested me. I’m a migrant here and my family were immigrants to Argentina from Europe, going back generations,” he said in an interview.

With mistrust of migrants on the rise in many Western societies, Habiague said it was important to stress the positives of incomers who “bring richness to a culture”.

He founded Mescladis in his 30s after leaving consultancy and said he chose a restaurant because food unites people.

“Working in a restaurant is all about action, not words, and so it’s easy to bring people together,” he told the Thomson Reuters Foundation. “Also, everybody loves food.”

Each year, about 80 students join the culinary course – known as “Cooking Opportunities” – during which time they intern in the restaurant and at other eateries in the Catalan capital.

NOT WELCOME

More than 1.8 million migrants have entered Europe since 2014. Greece and Italy receive the most asylum claims, with Spain only receiving a small share of all claims..

However there is public support in Spain for admitting more migrants, especially in the wealthy region of Catalonia.

Just this month, the Spanish government agreed to take in hundreds of refugees and migrants aboard the Aquarius rescue ship, which had been rejected by Italy and Malta.

Barcelona’s City Council said this week that the Catalan capital would accept 100 of the 629 people on board.

For incomers who seek asylum in Spain, applications can drag on for seven years, during which many resort to casual labour or illegal activities like street selling to make ends meet.

It is challenging for newcomers to fend for themselves without any work, Habiague said. “I was shocked at the treatment of migrants in Europe when I first arrived here.”

POET’S CORNER

Tucked in the corner of a neglected square, Mescladis is bustling and offbeat. Its walls are hung with photos of those who have passed through its doors, its shelves laden with quirky objects from around the world.

The cavernous building – it was the birthplace in 1860 of revered Spanish poet Joan Maragall – was long abandoned before Habiague turned it into a restaurant.

Now it employs 14 former alumni of the school, as well as a constant flow of interns from the course.

Senegalese-born Soly Malamine, who is manager of the restaurant, completed the cookery course in 2010, after arriving in Spain by boat six years earlier.

The 33-year-old left home because he couldn’t find work and disliked the level of corruption. First he tried construction work in southern Spain before moving north to Barcelona.

“It was very hard finding work when I first arrived here. I was almost a year without work – and I didn’t have papers which made it more complicated,” he told the Thomson Reuters Foundation.

The international charity Caritas helped him find Mescladis.

“I was like ‘wow’ because it was the only place I could find to work where they didn’t ask me who I was, where I was from or anything,” he said.

Now he enjoys helping others facing the same sort of problems, and showing it is possible to overcome them.

“I like working here, for the human side. At the end of the day, you don’t feel like it’s a job, you feel like it’s a family,” he said.

The team routinely sits and eats together – an important ritual for immigrants excluded from much social life, he said.

ONCE UPON A TIME

As well as breaking down barriers through food, Habiague is keen to tell the stories of the people of Mescladis, aiming to humanise his staff through initiatives such as photography exhibitions and comic books.

A graphic novel, called “A Present for Kushbu”, tells the stories of nine asylum seekers on their often perilous journeys to Barcelona. Kushbu, after whom the book is named, works at Mescladis, as do some of the book’s other characters.

Mescladis is also launching a craft beer this month, which Habiague hopes will broaden the work opportunities for its alumni, in production, marketing and distribution.

By Sophie Davies, Editing by Lyndsay Griffiths. 

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