Social EntrepreneurshipEconomy of Communion Armando Coloma, Jr.
Contents Social Entrepreneurship Background/Origin Focolare Movement Objectives of the Economy of Communion Concept of Economy of Communion Business Practices and Culture Benefits & Pitfalls Success Stories in the Philippines Bangko Kabayan Ancilla Enterprise Development Consulting Focolare Tagaytay Carpentry Shop
Social EntrepreneurshipSocial entrepreneurship is the work ofentrepreneurs who recognize a social problem anduses entrepreneurial principles to organize, createand manage a venture to achieve social change(social venture).
Social EntrepreneurshipThe main aim of social entrepreneurship is topromote social and environmental goals.Social entrepreneurs are most commonlyassociated with the voluntary and not-for-profitsectors, but this need not preclude making a profit.
Background (Focolare Movement)•The Economy of Communion is a business philosophyrooted on the ideals of the Focolare Movement. (FM)•This movement was started by a group led by ChiaraLubich, an Italian Teacher, during the Second World War.•FM intends to extend Catholic practice to their dailylives and not only limited to going to Church.•Members of the group pooled their commodities and Chiara Lubichshared with each other and with the less fortunate.•The movement aspired to spread a culture of givingwith the belief that this will lead to reciprocity andsolidarity.•FM has spread to over 180 countries with more than200,000 followers.•In the Philippines there are 12 Focolare centers spreadacross the nation Officially recognized by the Pope in 1950’s
Background (Economy of Communion)• In May 1991, Chiara Lubich was struck byviews of shanty-towns amidst skyscrapers inSan Paolo, Brazil.……Depicting inequality between rich and poor.• Members of the FM in Brazil did not haveenough commodities to meet their needs evenwhen they pooled their resources together. Brazil’s Shanties•She proposed to the FM to initiate enterprisesthat can add income to their pooled resourcesand help those in need.•In addition to sharing profit, these enterpriseswill reflect FM teachings such as equality andsolidarity.•Thus, the ECONOMY of COMMUNION (EOC)was born. EOC Enterprises
Objectives of the Economy of Communion To help persons in difficulty - by creating new jobs and assisting them in their basic needs; To spread the "culture of giving" and of love, without which it would not be possible to make the Economy of Communion a reality; and To develop the business, keeping it profitable and open to a spirit of giving.
Three Major Principles of Economy ofCommunion The first is association where potential shareholders of a business pool their resources together in a common fund. The second distinctive concept is “a spirit of fraternity” where stockholders, employees, and beneficiaries of the business treat everyone equally and with respect. The third major concept is a unique distribution of profit which is sometimes called as the 33% Rule
33% Rule (The profit of the company is pooled incommon and divided into three parts. ) The first portion is allocated in helping the poor in their The 33% Rule immediate needs. The second portion is appropriated to programs that are designed to share and spread the ideologies of EOC. The last portion is invested back into the company to develop and increase the Profit shared to poor/FM competitiveness of the Invested to education and training on EOC business. Invested back to Business
33% Rule (Just Imagine… )PLDT earnings 2009 P 39,800,000,000.00One third P 13,266,666,666.00 3,855,730 poor families 6-7 days (family of 5) Source: www.abs-cbnnews.com/business/03/02/10/pldt-q4-net-income-climbs-155-pct Source: www.nscb.gov.ph/poverty/2009/Presentation_RAVirola.pdf
Business Practices and Culture of theEconomy of Communion A Culture of Giving is instilled across the organization. The business is managed to promote increased profits but these revenues are used not only to expand the enterprise but more importantly to help people in need. The human person is central to the business, not the capital. The organization leadership encourage innovation, creativity, assumption of responsibility, and full participation in meeting the company objectives by all employees.
Business Practices and Culture of theEconomy of Communion The EOC businesses use modern business practices and methods to be as efficient as possible. This will allow the enterprise to offer useful, quality goods and services at affordable and fair prices to be competitive in the chosen field. The company establishes quality standards so that its products and services not only to meet contractual obligations but also to delight their consumers. The company practices fair play with competitors, suppliers, customers and business partners. These practices create an atmosphere of mutual respect and trust with competitors, suppliers, customers, and public administrators.
Business Practices and Culture of theEconomy of Communion Business leaders behave legally and ethically in all of their dealings. The enterprise complies with the law and maintains ethical dealings with tax authorities, regulatory agencies, and labor unions. The enterprise applies management systems and organizational structures that foster teamwork and personal development. The EOC business leaders employ decentralized control and participative leadership.
Advantages of the EOC The Purpose and Mission of EOC to help the less fortunate is very appealing to people of all religion and nationalities. Trust and solidarity with employees, customers, suppliers, and business partners is attained and sustained. This is because the human person, not profit, is the center of the EOC business. Competent people are entrusted with running the business. EOC enterprises makes use of the latest management and business practices to ensure that the company stays competitive in its chosen field. Resources are pooled together. Initial requirements for small businesses are more easily attained since the monetary, time, and skill resources of the members are pooled together.
Disadvantages of the EOC The practice of sharing a third of the profit to non- employees may not be acceptable to employees who are not members of the Focolare Movement. EOC may be applicable only to small to medium sized companies. Earmarking only a third of the profits may be insufficient for growth of the business. In today’s very competitive business atmosphere using all sources of funds including retained earnings particularly during the start up period is critical. Standardizing and implementing the profit sharing rule will be very difficult. A study of ten EOC enterprises show that their methods of profit sharing vary significantly. An extensive cultural change is necessary to sustain and spread the EOC philosophy. Without sufficient followers who will accept the EOC culture and philosophies, the sustainability of any EOC enterprise will be in doubt.
Success Stories in the Philippines: Bangko Kabayan Inc., a rural bank in Batangas, has moved from 123rd to third largest rural bank in terms of deposits. One of the few banks that survived the 1998 Asian financial crisis.Company Vision: Enabled by the Divine Providence and generating His presence among us as a work: community united in His name, we will be a leading rural financial institution through the: delivery of personalized and relevant financial services in an excellent manner, with a preference for the small and micro entrepreneurs of Batangas, contributing to the development of the countryside.
Success Stories in thePhilippines: Tita Datu Puangco of Ancilla Enterprise Development Consulting, a Filipino EoC company. The Company became the top training and consultancy provider in Southeast Asia after just five years in operation. She widens one’s vision of work by posing questions such as “What is the will of God for my life?” and “Who are you here to help?”
Success Stories in thePhilippines:•The Focolare Tagaytay Carpentry Shop is afurniture manufacturing center that began in1987.•An Austrian master carpenter who is aFocolare convert trained out-of-schoolyouths in the trade.•Demand for their products increased dueto the personalized and made to orderapproach of the business.•The shop now has 60 full time employeesand has trained hundreds of out of schoolyouth that are now government recognizedfor their skills.