From juice to jewellery
Social enterprises have proved to be beneficial to many of South-eastern Asia’s poor.
10 April 2018 | Business
"The poor do not have many options for work, but social enterprises are a great way to generate jobs and incomes, and benefit many more in the community"- Joni Morales, manager at Gawad Kalinga, which runs Enchanted Farm.
For the 48 families who once lived in shanties and rundown tenements around Manila, going to work meant hour-long commutes in crowded jeepneys and tricycles.
Now, they walk a few hundred metres along the tree-lined Enchanted Farm site in Bulacan, about 40 km (25 miles) north of Manila, to one of its half dozen social enterprises - businesses which address social problems while making a profit.
From making peanut butter to designing plush toys, the businesses developed in-house have enabled the former slum dwellers to escape poverty and improve their lives.
"The poor do not have many options for work, but social enterprises are a great way to generate jobs and incomes, and benefit many more in the community," said Joni Morales, a manager at Gawad Kalinga, which runs Enchanted Farm.
"Everyone who lives here works here, and can themselves become entrepreneurs one day."
Experts said such efforts to narrow growing inequality could get a boost if the Senate approves the Poverty Reduction Through Social Entrepreneurship Bill, designed to include the sector in development plans and increase training and access to funding.
One in five Filipinos is poor, living on less than US$1.25 per day, according to the World Bank, even as the economy has among the fastest rates of growth in the world.
In the meantime, local universities offer degrees in social enterprise, and the number of ventures has more than tripled in the last decade to 165 000, according to a study by the British Council and the Philippine Social Enterprise Network (PSEN).
"For the marginalised with little education and few resources, social enterprises are often the only option for financial security, sustainability and empowerment," said Gomer Padong at PSEN, which is pushing for the passage of the bill.
"They are particularly relevant for the Philippines, as the poor are increasingly locked out of private sector-focused development," he told the Thomson Reuters Foundation.
At Enchanted Farm, residents built their own two-room homes with materials gifted by donors, each family putting in about 500 so-called "sweat equity" hours to be included in a lottery for the homes that they then own.
Gawad Kalinga's founder Antonio Meloto aims to lift 5 million out of poverty by 2024 through social enterprises.
Like Bayani Brew, a line of natural beverages made from ingredients such as lemongrass and pandan leaves.
Originally formulated by resident Linda Maningas, a group of women at Enchanted Farm test different concoctions, and the beverages are sold in a number of retail outlets, including at Manila's international airport.
"This is something I did, and it's nice to see that there is a whole range," Maningas said, as she handed a bottle priced at 50 pesos (US$1) to a visitor in her small shop selling snacks outside her home.
"Having your own home and your own business gives you security," said Maningas, 52, who has lived there since 2008.
Other businesses include First Harvest - partly funded by Australian Aid - which makes peanut butter and other spreads, and Plush and Play, set up by a French well-wisher, that makes stuffed toys resembling vegetables and fruits.
A sister organisation, Human Nature, makes skincare and bodycare products with ingredients such as coconut, aloe and lemongrass sourced from poor farmers. Its employees include Enchanted Farm residents, as well as slum-dwellers.
New ideas are hatched constantly, including by youth who cannot afford to go to college. They are trained to become social entrepreneurs.
"Otherwise their only option is to go overseas to work in low-paying jobs. This gets them out of poverty, gives them dignity, and benefits the larger community," Morales said.
But awareness among regional lawmakers is still "relatively low" and they have been slow to yield to policy demands, said Tristan Ace, British Council's global social enterprise lead.
There is cause for optimism, though. Vietnam revised its law for businesses a few years ago to include a social enterprise article, while Malaysia has a three-year strategy to expand such ventures.
"Although the argument for why social enterprise is a route to support inclusive and sustainable development is powerful, the evidence base is not particularly well developed," Ace said.
"For risk averse governments, evidence and practical examples are vital," he said, adding that the British Council is surveying social enterprises across Southeast Asia to quantify their impact to encourage further legislation.
In Thailand, home to some 10 000 social enterprises, the government set up a Social Enterprise Office in 2010.
Even though a draft social enterprise promotion act has stalled, businesses with a social mission are flourishing.
The Sikkha Asia Foundation trains older women who cannot do physically demanding work in Klong Toey, Bangkok's largest slum, to fashion embroidered fabric from poor Karan, Akha and Hmong tribes in northern Thailand into bags, runners and book covers.
They also make jewellery and articles from repurposed rice bags, designed by a Japanese artist, which gives them an edge in the market for products that do good, said Nalynya Jaroonruangrit at the Foundation.
Another venture focuses on female refugees and asylum seekers who have little education and are legally not allowed to work, using their traditional skills in embroidery and intricate henna designs, to make bags, pouches, notebooks and t-shirts.
"These are the most vulnerable of people," said Bernardo Miranda, whose venture in Bangkok, which he declined to name, works with about 40 women from Vietnam, Pakistan and Sri Lanka.
"Businesses have more resources, but social enterprises are more suited for such a niche group because they are quite hard to reach, and need flexibility, and a focus that is not on profits."