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"Good Intentions and Good Results"

Looking Beyond the Non-Profit / For-Profit Divide

(First appeared in The Stanford Daily, 2/1/2005
as "Have Your Cake and Eat it Too")

Stanford students want to change the world — even if they don't always admit it.

Freshmen arrive knowing all the privileges they've been given, and seniors leave wanting to show that their Stanford experience wasn't just all about getting that job at the end.

But at the same time, there's an idea out there that subverts these good intentions: If you want to make a change, you have to work for a non-profit organization. Non-profits are good for social change, but bad for the bank; for-profits are good for the bank, but bad for social change.

This is wrong. Non-profits don't always improve society, and for-profits don't always make things worse. Non-profits can cause more problems for the world or just waste money and resources. For-profits can address social problems with new products and policies.

It's true that non-profits have "social" goals and for-profits have "economic" goals. And it's also true students who gravitate to non-profits tend to have different motivations than those who are attracted to for-profits.

But intentions are one thing and results are another.

It's not enough that someone wants to help disadvantaged kids by starting a tutoring program. Or that someone wants to make millions writing computer software. One is not necessarily "socially" better than the other. The question isn't "what kind of organization is it?" but rather "what does it do?" We should be asking: Is it actually helping people? Is it working efficiently? Is it sustainable?

These realizations drive new, innovative ideas for social change. It's the realization that everyone, in all sectors, can contribute to social change.

The key is to recognize that non-profits and for-profits share core features. We've been too quick to see the two as opposites: tree-huggers and frat-boys, justice and self-interest, Seth and Luke. But for all their differences, they both share the goal of utilizing their resources in new and effective ways.

Ben Cohen and Jerry Greenfield wanted to make ice cream, but they also cared about the local community, the environment and social causes. The Body Shop was founded with the hopes of bringing nature-inspired products to socially and environmentally-minded consumers. Working Assets, a communications and credit card service provider, is "making it easy to make a difference," and they have donated over $46 million to progressive causes.

Then there's "corporate social responsibility." Multinational companies, the wise ones at least, are taking huge steps to use their global presence and power to address social needs.

While there is still much to be done on this front, companies like Gap, Inc. have grown in a positive direction over the last decade. The market for socially-friendly products is growing fast.

All of these examples are situated within what we call "social innovation." Social innovation includes the new approaches, the new models, and the new ideas that are being born to address social problems. And these solutions span all sectors — nonprofit, for-profit and public.

It's an old moral: "The road to hell is paved with good intentions." It's results, not just motivations, that matter. It's what you do, and what it does, that changes the world.

Stanford students want to make a change in the world. But whatever sector they join, it's only the first step. For-profit, non-profit or otherwise, social innovations can make the world a better place.

Wow, great article. How can I read them all?

All the interviews with outstanding social entrepreneurs and articles have been collected into a report on social innovation. It is available below for easy reading, printing, and sharing.

The Story of Social Innovation:
Interviews with Social Entrepreneurs