Social Entrepreneurship in the Middle East: Old Practice, New Concept

As a Lebanese born and raised in Beirut on a small street in Gemmayze that used to sit on the iconic Green Line—a strip of buildings and streets overgrown with foliage that marked a no-man's land between warring factions during the Lebanese Civil War—I spent much of my time waiting in line to fill containers with water or buy a loaf of bread. Sometimes we played cards in an underground building when bombs dropped instead of going to school. The level of solidarity that existed between the people in my neighborhood saved many of us from hunger, thirst, and even death. This solidarity was not only driven by survival, but also grounded in a culture perhaps best described by the proverb Aljar kabel aldar (“Your neighbour before your family”).

This culture of solidarity still exists in many villages throughout Lebanon, including those bordering Syria. It binds together villages that suffer from poverty and lack access to basic services. And in many of these places, local citizens and refugees are generating innovative ideas and transforming them into enterprises that provide education, health care, and clean water.

Over the last six months, my colleagues and I visited six countries in the Middle East and North Africa (MENA) region—including Lebanon, Jordan, Egypt, Tunisia, Morocco, and Algeria—to study social entrepreneurship ecosystems, and to my surprise, I have observed an entrepreneurial dynamic similar to Lebanon’s in many of these areas.

As part of a mapping mission to support social enterprise ecosystems in the Southern Mediterranean countries, we interviewed more than 100 individuals, including social entrepreneurs, public officials, leading figures in incubators, financial institutions, and international organizations. Interestingly, when we asked these participants to name social enterprises in their countries, they could not. But after we described a social enterprise as an entity that makes a positive social impact and generates revenue to scale up, they could.

This started us on a quest to define social enterprise in a way that anchors the term in the context of the region. We believe this is important for several reasons. As we’ve seen in other parts of the world, a distinct definition of social enterprise not only creates opportunity for policy dialogue that can eventually lead to the design of a useful legal framework, but also facilitates the development of adapted financing mechanisms and support services enterprises need to succeed.

We realized early in the study that setting a clear, common definition for social enterprises in the region might be unrealistic and that—at least to start—it might be more worthwhile to define a set of parameters for identifying those entities.

We began by summarizing our core findings from our literature review and field visits:

1. Old practice, new concept. Socially entrepreneurial initiatives that result from a culture of solidarity, especially in rural areas, and the need to create social support networks to help the less privileged (without relying on external financing from the government or other stakeholders) have always existed in this region. In a study we did of 137 municipalities, we discovered that in most places, citizens came together to serve the poor through innovations like mutual insurance funds and cooperatives. Nevertheless, there is little awareness of the concept of “social entrepreneurship,” and finding a translation into Arabic that would make sense with respect to local cultures presents a particular challenge.
2. Variety of legal frameworks: Within the region, social enterprises lack a legal framework that defines them in the marketplace. They are sometimes informal, and when they are registered, they tend to establish themselves under a variety of legal forms, including non-governmental organizations, private businesses, cooperatives, civil companies, or some combination of these. For example, an online education social enterprise in Egypt established both a corporation to generate revenue without being prosecuted by government and a nonprofit to access international donor funding so that it could scale up in less-privileged areas.
3. Contextual definition of social innovation: Social problems vary widely between countries, and between the urban and rural areas of each country. The social innovation and social business models people develop are thus highly adapted to the unique social, economic, and cultural challenges of their locality. For example, in some conservative areas in Iraq where women have little opportunity to leave their houses but are allowed to visit local gyms, they use gyms as places to not only take care of their health, but also engage in rights-based conversations and network around common issues.
4. Social entrepreneurs as agents of change: As elsewhere, individuals and groups in both the nonprofit and for-profit sectors, and sometimes outside any form of enterprise, are positively disrupting the region. We can identify these entrepreneurs through the impact they have made in their communities, the values systems they have adopted, and the interpersonal capacities they have proved through their activities. Social entrepreneurs in the region strive to improve the quality of life within their communities but must overcome all the barriers put down by their own governments through bureaucracy, red tape, and corruption. For example, in Lebanon an alternative energy social enterprise for a community has to scale up its solution fast enough that citizens can own it and fight for it over more-expensive and unreliable government-run energy services.
5. International discrepancy in definitions and approaches: Overall awareness of the concept of social entrepreneurship in MENA is very low, and the segment of society most exposed to it are middle class young people, who have encountered it through European and international initiatives that use a variety of definitions and approaches. This makes it difficult to build consensus on one definition in countries financially dependent on aid, and where governments are not equipped or willing to define it according to national social and economic context. When donor agencies such as European governments and multilateral agencies intervene in the same communities at the same time using different terminology and program designs, it can result in confusion between stakeholders and social entrepreneurs.

Based on our research, we compiled six parameters for identifying social enterprises in the MENA region, within three different dimensions: intended social outcome, governance, and agency.

 

Social Enterprise Outcome: This dimension is concerned with social impact and innovation within the political, social, economic, and cultural contexts of each country. A social enterprise is focused on the social impact it aspires to achieve, rather than profit, and on improving the living conditions for marginalized and less-privileged groups and communities. A social enterprise also offers innovative solutions to a social problem at the business model, production, and distribution levels.

Social Enterprise Governance: This dimension differs between countries based on the most suitable legal frameworks for the social enterprise business model. These frameworks help ensure that the enterprise is financial sustainable and its governance is participatory in nature.

Social Entrepreneur Agency: This dimension is critical for the credibility and legitimacy of people aspiring to start their own social enterprises within communities, which often feature strong social proximities and weak formal accountability mechanisms. Those leading a social enterprise have a high level of integrity and a passion for change; adopt human values; and ensure transparency, accountability, and participation in their practices. A social enterprise follows ethical standards in using local human and natural resources and assets, and protects environmental standards as it operates.

These dimensions and parameters are designed to contribute to the conversation on the momentum of social entrepreneurship that has been initiated in the region. They aspire to sidestep any potential misuse or corruption of the concept before it is regulated, with the hope that it launches a serious policy dialogue that eventually protects social entrepreneurs and allows them to become the new agents of change in their countries.

In addition, social entrepreneurs need to frame their efforts as civic-engagement phenomena in the Middle East—as opportunities for citizens to own back the public space through solving their social problems sustainably. Social entrepreneurs should be conscious of their role on the local level. Equally important, however, is their role in translating their social innovations into public policies that can scale up at a national level and impose a new development agenda on policymakers. This is how to build on the culture of solidarity, maximize resources, and redefine politics as a positive, bottom-up, citizen-centric practice. And it is how change agents can stop countries in the MENA region from slipping into greater poverty, corruption, and sectarian violence.

Read more stories by Gilbert Doumit.