Is volunteering the new exploitation?

Another great conversation that emerged at the Shine 2010 unconference was about the nature of volunteering. I think we just assume that volunteering is a force for good and is about people being generous with their time and skills for the benefit of others. I mean what could possibly be wrong with that?

Doug Richards from the School for Start-ups suggested a very different way of looking at volunteering. He argued that asking people to provide labour for free is simply exploitation. That if a social business is genuinely trading then it should pay people for their labour and incorporate their costs in the price of the goods or service. His final parting shot on the subject is that "working for free is a hobby not a job".

I think there is something to this point of view. If the driver for a charity or particularly a social enterprise for using volunteers is that they can't afford to pay people then it means they are admitting that they cannot compete with other organisations. If a competitor's product or service is so much better than yours and the only way you can compete is by using free labour, then you do not have a sustainable position in the market. If we criticise firms that use sweat-shop labour as being unethical, shouldn't we apply the same standards of criticism to those who pay their workers nothing.

This isn't criticising the motivation or altruism of people who want to give their time for free but the lack of aspiration of the organisations that accept it. If you are a charity and using free labour is the only way of plugging a deficit in your funding, then I have some sympathies but I think this should be challenged in anyone who aspires to be a social enterprise.

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Profit isn't evil - get over it

The interesting thing about social enterprise is that everyone asumes that we are talking about the same thing until a question arises that sharply divides them into various camps. There was such a question at the Shine unconference this morning and that question was "Is profit evil"?

Because within the social enterprise community are charities, voluntary groups and social businesses; some totally dependent on grants, some that genuinely trade and some that make considerable profits. For my money grants are simply donations from rich people or rich organisations and whilst they sometimes generate social good they are not sustainable. Grant income is simply a 21st-century version of medieval patronage and is entirely dependent on the whims of the rich. Whilst free money is always nice, it clearly isn't sustainable; which brings us to the idea of profit.

At a purist level, profit is simply the surplus of income over expenditure but for some charitable organisations, the word and the idea carry connotations of the most evil blood-drenched capitalist machines. For those of us at the social business end of the spectrum, profit gives you sustainability, independence and the potential to grow (and therefore massively increase your social and environmental impact). Whilst there may be an emotional (and arguably irrational) reaction to the word "profit", it is really just surplus and if you aren't making a surplus then you are just going out of business slowly.

A much more interesting debate is whether the MAXIMISATION of profit is inherently evil. There is a world-wide track record of organisations who maximise profit by laying off vast quantities of workers, reducing pay and benefits, sourcing from lowest-cost providers, dumping industrial by-products and taking resources from countries that can ill-afford to lose them. If the overriding factor in a company's decision-making is the maximising of profit, it is almost certainly reducing its social and environment impact, if not actively causing social and environmental harm. Corporate Social Responsibility initiatives may be a public-facing sticking plaster over this activity but the scale of it is dwarfed by whatever the core business processes are.

So the really interesting ethical division for businesses is not between those that break-even and those that make profit; but between those that make profit AND social and environmental benefits and those that maximise profit (at the expense of any social and environmental considerations). Depending on which side of that divide you are is a better indicator of whether you are really a social enterprise or a profit-maxising private sector business.

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Testing my new iPhone app

In a vain attempt to blog slightly more regularly, I have installed BlogPress on my iPhone. This is my first attempt from it and so far it seems to be working quite well. Of course, when I get my iPad, I suspect that it will be even better :)

- Posted using BlogPress from my iPhone

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