Social entrepreneurship in the South

Lola Herrero is an Associate Professor at ESCP Europe, on the Madrid campus, and Academic Director (Option E) in the Jean-Baptiste Say Institute. She gives us an academic perspective on social entrepreneurship in developing countries.

Social entrepreneurship in the South

From an academic point of view, how do you define social entrepreneurship?

If we understand “social entrepreneurship” as a way of taking actions that have a positive impact for the community, we can consider that it exists since the beginning of humanity, because it  has always been of human concern. But it is only in 1996 that the first research centers have emerged in Europe to study social entrepreneurship. The Social Enterprise Knowledge Network (SEKN), created in 2001, was one of the first academic institutions developing knowledge on social entrepreneurship: it was led by Harvard Business School and several business schools in Latin America. This shows that Latin American countries have always been leaders in this area.

Afterwards, several research centers, along with national and regional governments, started gaining interest in this topic, and a few scientific publications made their appearance. However, up to now there is no consensual scientific understanding of the concept: research on this topic is still in progress from many angles. Among other elements, further research should be conducted to:

  • Clarify the concepts of profit and non-profit enterprises
  • Identify the elements of distinction/connection between social entrepreneurship and social work
  • Understand the differences between social entrepreneurship and corporate social responsibility implemented by traditional businesses
  • Understand the multiple interlinkages between social and solidarity-based economy and social entrepreneurship.

We can find more than 20 definitions of social entrepreneurship, (in A typology of social entrepreneurs: Motives, search processes and ethical challenges Zahra, Gedajlovic, Neubaum, Shulman, 2009). A common element between the different definitions of social entrepreneurship is that they all focus on the search for concrete solutions about social issues/problems. At the same time, a new approach is emerging, about how social entrepreneurship should focus not only on solving social issues but also on the creation of social value through innovation.

Do you make a distinction between Western and Southern dynamics of social entrepreneurship? Are there different understandings of social entrepreneurship, if you compare, for instance, Europe to Latin America?

In Europe, there is a long history of attempting to achieve well-being for all, especially after the Second World War, with the emergence of the welfare state. European institutions were also created with this concern in view, hence the European Economic and Social Committee. The  report Evolution of the social economy in the EU, published in October 2017 shows the growing importance of social economy in Europe, in both human and economic terms. It represents more than 13.6 millions paid jobs in Europe, which equates to 6.3% of the total European working population. Considering both paid and unpaid jobs, social economy is a workforce of more than 19.1 million people, with more than 82.8 millions volunteers, equating to 5.5 million full-time workers. Cooperatives, mutual insurance companies and other similar entities have more than 232 million shareholders. Finally, social economy represents more than 2.8 millions entities and companies.

On the other hand, Latin America has a strong heritage in terms of community initiatives: in research, we call it social and collective construction (construcción social y colectiva). For example, in Nicaragua, the tradition of associationism and cooperatives has a long history and was reinforced in the early 1980s with the Sandinista revolution. But these initiatives only tackle basic survival necessities, and for a long time, there were no official initiatives or policies to develop this form of social economy. More recently, an ecosystem of social initiatives has emerged, such as the Central American Platform of Solidarity Economy which purpose is to promote a sustainable agri-food system based on solidarity. The emphasis is more on solidarity at the community level than on social economy as we understand it in Europe. In the Central American understanding, issues such as food security are solved only at the territorial level. Thus, social entrepreneurship in developing countries is more focused on the resolution of basic needs through sustainable and solidary means.

Can social entrepreneurship foster development?

From my experience and research on Latin American social entrepreneurship models, social entrepreneurs in the South can play a major role in development because they have a clear snapshot of the social reality in their community, since they live in it everyday. They are conscious of their social environment and decisively involved in strengthening the social fabric. Comparing with large businesses, which replicate the same economic models everywhere they are based, social entrepreneurs have a case-by-case approach.


A part of your research is focused on responsible tourism. Do you believe that tourism can integrate a social dimension to North-South exchanges? 

Tourism is a great tool for responsible development in southern countries, especially in Central America, because those countries attract each year an increasing number of tourists from the North. Using these human flows, we can work with local social entrepreneurs and stakeholders to develop a new ideal model of tourism flows, based on the idea of  “sustainable destinations for responsible travelers”. It is an enormous challenge because sustainable tourism requires that all stakeholders on tourism destinations and tourism sites are aligned and involved in a co-creation process. And when it works, it is a great source of wealth: for instance, sustainable tourism is an asset for territorial enhancement in indigenous communities of Central America. A good example is the community-based tourism initiative in Guna Yala, an indigenous region of Panama.


You have worked on South-South and North-South development projects. Have you identified transnational dynamics of social entrepreneurship?

I have worked on development projects based on what we call triangular cooperation, because it involves a three-way partnership between Southern and Western actors. For instance, in a past project called the “Vocational Training and Sustainable Tourism” (VTST), the partnership included Spain, Morocco, Senegal, the Gambia, Bolivia and Nicaragua. The triangularisation of cooperation projects is a very innovative paradigm that radically changes the way in which we used to cooperate, with “vertical projects” (North-South). This triangular cooperation system allows for a sharing of good practices between countries that might not have the same realities but can gain from each other’s experience. This mechanism is also challenging because it poses the issue of adaptability and replicability: is this model replicable anywhere, given the diversity of actors?

Currently, on the Madrid Campus, we are developing another partnership for an EU-funded development project called IRUDESCA (website in Spanish). It involves more than 20 partners from 9 countries (three European countries, Nicaragua, Honduras, Guatemala, El Salvador, Costa Rica and Panama) which participate in efforts to design and implement common tools and practices for the promotion of social entrepreneurship models. The project is in its mid-term development phase, but early results have confirmed that developing common tools applied to local realities could be a great impulse to promote social transformation in emerging countries, through innovative entrepreneurship.