At the heart of venture philanthropy is an engaged approach with the funded organisation. Ideally what is provided by the social investor or resource provider matches what is needed on the side of the social purpose organisation. The social purpose organisations’ needs tend to come from internal parameters in the social purpose organisation, e.g. the development stage of the organisation, the management team, its social mission, business model and growth plans as well as the external environment, which shapes the entrepreneurial eco-system, economic stage of the country and the role of the government. Social investors then have different in-house capabilities to support capacity building and hence need to draw on third-party providers either paid, low- or pro-bono. This requires the venture philanthropy organisation to manage the third-party interactions.
Capacity building includes a variety of tools such as strategic support, professional services and physical infrastructure, which aims to create value in two ways: firstly for the social purpose organisation by helping them to achieve their social missions and secondly for the social investor or resource provider by increasing their impact.
British Council China, though not a typical venture philanthropy organisation, provides an example for capacity building due to its strategy in building the ecosystem as well as organisations. From 2009 to 2014, its Social Enterprise Programme has trained over 1800 social entrepreneurs, delivered RMB 29 million (roughly above US$4.5 million) in funding and social investment opportunities from partners to 91 social enterprises.[1]
Organizational Portrait
The British Council is a UK charity founded in 1934. Since opening its first overseas offices in 1938, British Council has expanded its network to over 100 countries and regions, connecting millions of people to the United Kingdom through programmes and services. Globally, its 7,000 staff – including 2,000 teachers – work with thousands of professionals and policy makers and millions of young people every year by teaching English, administering exams, sharing the arts and delivering educational and social programmes, with the aim of supporting charitable causes and social well-being around the world.[2]
In 1943, the British Council’s first office in China was opened, in Chongqing. The British Council currently works in four cities in mainland China:[3] Beijing, Shanghai, Guangzhou and Chongqing. In Beijing, the British Council presents itself as the Cultural and Education Section of the British Embassy. In Shanghai, Guangzhou and Chongqing, it operates as the Cultural and Education Section of the British Consulates-General. The British Council’s work in mainland China specifically focuses on developing social enterprises in the country.
British Council China’s efforts in building a pipeline in social entrepreneurship
The social sector in China is experiencing a period of transformation. On one hand, investors and philanthropists are exploring new approaches to make full use of their money rather than simply giving it out.[4] On the other hand, an increasing number of social purpose organisations are building self-sustaining capacities in order to rid themselves of dependency on traditional grants. In this context, the concept of “social enterprises” imported from western contexts has been gradually accepted by Chinese practitioners.[5]
However, this new trend in the development of social enterprises in China is accompanied by two main challenges. First of all, as the idea of “social enterprises” has yet to be well developed in China, the majority of participants have very little knowledge of and skills in handling social enterprises. Furthermore, the seed funding provided to social startups is significantly limited. For those social enterprises in their scaling-up stage, there is very little access to the advanced management training and investment opportunities required to enhance the scale and impact of their work. This challenging environment in China explains why the British Council is dedicated to promoting the development of social enterprises in the region.
British Council’s building the eco-system
The social entrepreneurship programmes of the British Council in China can be explained as a three-layer pyramid, as indicated in Figure 1.[6]
The British Council’s approach is unique in that it works to address social entrepreneurship from both a top-down and bottom-up perspective: “Policy Engagement” approaches the development of social entrepreneurship from the top by working with policy makers, while “Awareness Raising” builds the general ecosystem to promote social enterprise and social investment, corporate social responsibility, and sustainable economic development. Under its “Policy Engagement” arm, the British Council convenes policy dialogues and works closely with the Chinese government and political institutions. Meanwhile, as part of its “Awareness Raising” activities the British Council collaborates with external media organisations, in addition to establishing its own digital channels to promote public engagement in social enterprise sector. The most up-to-date concepts and stories of successful Chinese and UK social enterprises are published through its publications or other media reports.
From 2009 to 2014, the British Council has hosted salons, lecture tours, and other public engagement activities involving 17,000 experts, philanthropists and university students. Moreover, it has promoted the social enterprise model through social media campaigns that have reached an audience of 12 million people.[7] A UBS-funded study indicated that the British Council’s Social Enterprise Programme has played an instrumental role in fostering the emergence of China’s social enterprise sector.[8]
Building capacity for social entrepreneurs and social enterprises
In addition to fostering the general ecosystem, capacity building—designed specifically for social enterprises and social entrepreneurs—lies at the very core of the British Council’s pyramid of activities. The British Council is currently running a Social Enterprise Programme and has established a Social Investment platform to connect social enterprises with investors. Meanwhile, the British Council also organises the Young Changemakers Programme, aiming to inspire and train younger generations to undertake voluntary community projects and develop their understanding of social enterprises.
The Social Enterprise Programme supports social enterprises around the world that employ business strategies to meet social and environmental needs and make a positive impact in the community.[9] Launched in mainland China in 2009, the programme has expanded to 25 countries worldwide. The programme draws on the experience of the UK in social enterprise and social investment and provides skills training, access to UK expertise and links to social investment opportunities to social practitioners.[10] As the UK social enterprise sector is among the most developed globally, the British Council can offer learning and lesson sharing and ‘has found that the subject provides a rich arena for cultural exchange, facilitating strong societies’.[11]
Skills for Social Entrepreneurship Training, under the Social Enterprise Programme, is specifically aimed at providing individual capacity building to social entrepreneurs. The course enrollment criteria have been adjusted year-by-year to be more inclusive, ensuring that social enterprises at different stages of development can participate in the programme. For the year of 2015, the British Council announced four criteria for an applicant to be eligible for the programme:[12]
- Be enthusiastic about contributing to social work and solving social problems;
- Be open-minded and creative;
- Have an idea, plan to set up a social enterprise or have already done so;
- Be clear about the beneficiaries or target audience.
During the selection period, all applications are assessed by both essential criteria and desirable criteria. Essential criteria include:[13]
- The organisation or project has made or has the potential to make positive social or environmental impact;
- There is a demand in the market for products/services provided by the organisation or project, and there is a clear definition of beneficiaries;
- A sustainable business model is in place or has the potential to be developed.
And desirable criteria include:
- The applicant has the relevant experience in project management, and the organisation has a well-structured team;
- The applicant has developed an innovative solution to address social/environment problems.
After admission into the programme, social entrepreneurs will be provided with both basic and sector-specific training courses. Both courses are designed and implemented by Chinese and British experts, among which include social enterprise and social innovation experts, scholars, practitioners and investors.[14] The basic training courses usually start in early July each year and the content is mainly an introduction of basic concepts in the social enterprise sector. In August and September, more advanced courses cover more specific topics, such as legal issues and financial skills. Both phases of the training programme are open to the public. In other words, the basic training courses are not pre-requisites for the sector-specific training; participants can choose either course based on their own needs. Through the training courses, social entrepreneurs can improve their abilities to optimize business plans, develop their administration skills, improve professional capacity, communicate with investors and widen their network of contacts.[15] Since 2009, there have been over 2,100 graduates from the Social Enterprise Programme.
The British Council also plays an intermediary role in connecting investors and social entrepreneurs by providing financial support, in addition to organising training programmes. For the first four years of the Social Enterprise Programme, the British Council ran an awards scheme, which provided grants to participants from its training programmes.[16] Only graduates of the training courses were eligible to apply for investments from this award scheme. After launching the Social Investment Platform, the British Council welcomed all social entrepreneurs, whether they had participated in its training courses or not, to apply and compete for investments.
The Social Investment Platform was launched in 2013 by the British Council and seven social investors to promote social impact investment and provide training and funding opportunities to outstanding Chinese social enterprises. The British Council also stages separate competitions for social enterprises and provides winners with investments through the platform. In its first year (2013-14), the Platform offered RMB 9 million (over US$ 1.4 million) in equity investments opportunities, interest-free loans and grant funding, and incubation support to 15 outstanding Chinese social enterprises. These social enterprises were selected from a pool of 268 applicants through a multi-stage competition. In its second year (2014-15), the Social Investment Platform brought together nine partners offering more than RMB 10 million (over US$ 1.56 million) in investment opportunities, grant funding and incubation support to social enterprises from both mainland China and Hong Kong selected through the competition.[17] As Dr. Mairi Mackay, who leads the British Council’s social enterprise programme, explains, “Our platform provides essential support to established social enterprises so that they can create more jobs, address entrenched social problems and bring positive changes to their communities.”[18]
At the end of the training courses and investment process, feedback from graduates is gathered and utilized by an expert team from British Council to further develop the overall training programme as well as refine the content of each training workshop. For example, some trainees mentioned that they had benefited greatly from the practical knowledge and tools to improve all aspects of their operational management and that it would be useful to develop a sector-based training programme, so that they could meet sector experts, gain sectoral knowledge, learn outstanding practitioners’ models and build their industry network. After exploring this idea further with partners, the British Council proceeded to integrate sector-based training as part of their themed training programme in 2015. The first three sectors are elderly care, special education and creative industries.[19]
Another example is that after setting up the Social Investment Platform, some trainees expressed interest in learning more about social investment and how to communicate with investors. The British Council then developed sessions for them to understand the needs of social investors, how to prepare a business plan and how to conduct effective investment pitches. All these sessions received positive feedback from trainees in both the 2014 and 2015 training workshops.[20]
As a supplement to the Social Enterprise Programme, The Young Changemakers Programme was collectively launched by the British Council and the China Youth Development Foundation, to cultivate younger generations to provide social services. After being successfully piloted in Beijing in 2011, the programme has been rolled out to around 100 universities across China.[21] In this programme, the China Youth Development Foundation is responsible for the selection process of young participants, while the British Council is in charge of bringing the UK experience in encouraging social entrepreneurship to support knowledge delivery. In each year between 2011 and 2014, over 1,000 students learned the skills and knowledge to become effective social leaders and fundraisers through the Young Changemakers course. This project also helps university students set up their own social enterprises and establish links with UK social enterprises by providing international exchange opportunities. As Yang Xiaoyu, Executive Deputy Secretary-General of the China Youth Development Foundation, commented: “The project helps bring the UK’s advanced philanthropy concepts to university students in China, and also gives them the opportunity to plan and practice services in the context of philanthropy.” This programme has also earned high praise from the Youth League of the Communist Party of China and the Foreign Ministry of China.[22]
Tangible Outcomes and Remaining Challenges
To date, there are tangible outcomes stemming from the capacity building programmes for social enterprises. As mentioned, the Social Enterprise Programme has nurtured over 2,100 promising social entrepreneurs graduates since 2009. Delivered RMB 29 million (£2.9 million) in funding and social investment opportunities from partners to 91 social enterprises through the Awards Scheme and Social Investment Platform. Furthermore, the Young Changemakers Programme has seen over 1,000 students each year gaining the necessary skills to become effective social leaders from 2011 to 2014.
In terms of raising awareness and policy making, the British Council has hosted salons, lecture tours and other public engagement activities involving 17,000 experts, philanthropists and university students from 2009 to 2014. Moreover, it has promoted the social enterprise model through social media campaigns that have reached out to an audience of 12 million people.[23]
While the British Council has enjoyed great successes over the years, it continues to face serious obstacles. One of its greatest, most persistent challenges is the difficult political and legal environment for social enterprise development. Currently there are no supportive government policies or state-level legislations effective at regulating and guiding the development of the social enterprise sector. In response to this challenging context, the British Council is prioritising policy engagement as its key focus for the coming years.
In sum
The British Council’s China programmes have been influential in building social entrepreneurship through both top-down and bottom-up programmes. As the social sector has become an increased focus in China, the British Council’s intermediary position allows it to utilize the UK experience with social entrepreneurship to provide valuable resources for investors and social enterprises and to facilitate social enterprise growth. In the future, the British Council will continue leveraging resources for social enterprises and promoting the sector’s development.[24]
[1] Social Enterprise Programme http://www.britishcouncil.cn/en/programmes/society
[2] http://www.britishcouncil.cn/en/about (Accessed 9 July 2015)
[3] http://www.britishcouncil.cn/en/about (Accessed 9 July 2015)
[4] The development of Venture Philanthropy in China is facing both opportunities and challenges
http://www.recende.com/Item/Show.asp?m=1&d=189 (Accessed 9 July 2015)
[5] China Social Enterprise and Social Impact Investment Development Report (2013 version) http://www.serc-china.org/research/overview/sewhitepaper.html (Accessed 9 July 2015)
[6] Conversation with Mavis Meng on 14 July 2015
[7] Social Enterprise Programme Brochure
http://www.britishcouncil.cn/en/programmes/society (Accessed 8 July 2015)
[8] China Social Enterprise and Social Impact Investment Development Report (2013 version) http://www.serc-china.org/research/overview/sewhitepaper.html (Accessed 8 July 2015)
[9] http://www.britishcouncil.cn/en/programmes/society/social-enterprise-programme (Accessed 12 July 2015)
[10] http://www.britishcouncil.cn/en/programmes/society/social-enterprise-programme (Accessed 13 July 2015)
[11] Social Enterprise Landscape in Ghana http://www.britishcouncil.org/sites/britishcouncil.uk2/files/social_enterprise_landscape_in_ghana_report_final.pdf (Accessed 11 July 2015)
[12] http://www.britishcouncil.cn/programmes/society/news/2015-basic-training-ad
(Accessed 30 July 2015)
[13] http://www.britishcouncil.cn/programmes/society/news/2015-basic-training-ad
(Accessed 30 July 2015)
[14] Social Enterprise Programme http://www.britishcouncil.cn/en/programmes/society (Accessed 9 July 2015)
[15] Social Enterprise Programme http://www.britishcouncil.cn/en/programmes/society (Accessed 8 July 2015)
[16] Conversation with Mavis Meng on 14 July 2015
[17] http://www.britishcouncil.cn/en/programmes/society/social-investment-platform (Accessed 13 July 2015)
[18]https://eudevdays.eu/content/social-investment-boosts-chinese-rural-economy-and-reunites-families (Accessed 13 July 2015)
[19] Conversation with Mavis Meng on 14 July 2015
[20] Conversation with Mavis Meng on 14 July 2015
[21] http://www.britishcouncil.cn/en/programmes/society/young-changemakers (Accessed 13 July 2015)
[22] http://www.britishcouncil.cn/en/programmes/society/young-changemakers (Accessed 13 July 2015)
[23] Social Enterprise Programme Brochure
http://www.britishcouncil.cn/en/programmes/society (Accessed 8 July 2015)
[24] Conversation with Mavis Meng on 14 July 2015
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