The term social business is often confused with social enterprise. Both are similar in many ways, yet distinct in others. In fact social business may be called as a component of social enterprise or one of the ways by which a social enterprise expresses itself.
Although social business may be carried out in any area but sectors like healthcare, housing, nutrition, education, financial services to the poor and the down trodden remain the priority. Unlike profit making organizations, success in the field of social business is governed by the amount of impact it is able to create or the positive change it has been able to bring in the existing scheme of things.
The concept of Social business was given by Muhammad Yunus, who essentially presented as an alternate model to capitalism. It was meant to overcome the shortcomings and failures of capitalism that focuses only on profit making and ignores or fails to address other sides of business. He created a new system where profit making and social businesses exist simultaneously. Also, the social businesses are not prevented from making profits. They are however not allowed to take dividends and reinvest the money earned as profit in the business to scale operations and give maximum benefit to maximum people.
The impact of the business on people or environment, rather the amount of profit made in a given period measures the success of social business. Sustainability of the company indicates that it is running as a business. The objective of the company is to achieve social goal.
