Toms Shoes operates under a ‘one for one’ model, where any time it sells a pair of shoes, it provides a pair for a child in need.DEBORAH BAIC/The Globe and Mail
KARL MOORE – This is Karl Moore of the Desautels Faculty of Management at McGill University, talking management for The Globe and Mail. Today, I am delighted to speak to Christopher Marquis from the Harvard Business School.
Chris, what are some of your latest thoughts on social entrepreneurship?
CHRISTOPHER MARQUIS – I mean, it is really sort of amazing to me, over the past nine years that I have been at HBS, how student interest in this has really just skyrocketed.
I think when I originally started, I was teaching a required class and maybe a handful, maybe five, out of the 90 students were interested in these topics. Today, at HBS, there are probably 10 or 11 classes alone devoted to this. Some of the things they are interested in, particularly, are the new business models that are being created.
So, for instance, a famous example is this "one-for-one" type of model where any time a company sells a product, they end up actually giving away another product. So Toms Shoes and Warby Parker are two examples of this.
I also think another really interesting phenomenon is how business can be used for social good. One example of this, some cases I have done on chocolate companies, is that these companies are not necessarily interested in selling their products, they are actually interested in transforming the global supply chain on chocolate agriculture and production.
So it is not just about simple products, but these entrepreneurs are actually interested in changing the systems more broadly.
KARL MOORE – How should business try to get involved in this, or should they?
CHRISTOPHER MARQUIS – I think that business getting involved in social entrepreneurship is sort of a double-edged sword in some ways, because I think that one of the things they are interested in, potentially, is attracting consumers.
If they are getting involved in social entrepreneurship or social businesses from maybe a non-authentic type of way, it can potentially backfire.
So an example of this, that has been written up as a negative example, is how I think the company Skechers created a sort of knock-off Toms one-for-one model called Bobs. These had a one-for-one model, and sold okay, but actually there was a lot of negative publicity they got as a result of this.
On the flip side, actually Target Corp. recently implemented a one-for-one around school supplies and Target is actually well known for being one of the most generous companies in America – it gives away 5 per cent of its profits every year – so this actually ended up helping them because it resonated with their deeper identity and beliefs.
So I think, on the consumer side, I think that unless it is something that the company has had a long-standing commitment to or resonates with them, it has the potential to backfire.