Responsible Business Plan Project

Professor Dunham

1

Responsible Business Plan and Pitch (Individual Semester Project)

Introduction: The purpose of this assignment is for students to familiarize themselves with social entrepreneurship models and then develop a business plan and pitch for a new (hypothetical) responsible business venture. The business plan should focus on addressing a real-world social or ecological problem and then detail the strategy that will be employed to find a solution.

Background: Social entrepreneurship focuses on creating organizations that contribute solutions to social and/or ecological problems. Social entrepreneurs may structure their organizations as for-profit private or public companies (including B- Corporations), or as non-profit organizations. However, the common theme is that performance is measured by a positive return to society and/or ecological benefit, in addition to traditional financial metrics such as revenue, profit, or share price. Social entrepreneurs may consider the “triple bottom line” and their organization’s impact on a variety of stakeholders, instead of being motivated solely by shareholder profit.

There is a long tradition of questioning the role of business in providing well-being for society. In The Wealth of Nations (1776), Adam Smith argues that an individual’s need to fulfill their self-interest guides them to make decisions that result in societal benefit. In the words of Adam Smith, "It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but

from their regard to their own self-interest." In short, a baker is motivated to support his family financially. To do this, the baker produces a quality product that feeds and nourishes others, potentially benefiting hundreds of people.

The corporate social responsibility (CSR) model suggests that responsible business is good business because an organization that commits to responsible practices will have better outcomes in long-term profitability. Relatively small investments in the near-term may help the organization avoid embarrassing and/or costly mistakes that may tarnish their reputation and/or negatively affect their profitability later. For example, a consumer goods company may decide against releasing a dangerous product that potentially injures customers, resulting in costly lawsuits. An organization may place a strong emphasis on educating employees about sexual harassment and workplace equity in order to create a culture of inclusion. A company that relies on natural resources may consider the long-term sustainability of those resources in order to avoid a situation depicted in “the tragedy of the commons.” A self-regulating CSR approach may lessen the likelihood of external government regulation and costly fines for bad behavior.

Innovative entrepreneurs may seek transformation from a more traditional philanthropic model of business providing well-being for society to a social entrepreneurship model of performing societal well-being. During the Gilded Age of the late 19th century, titans of industry including Andrew Carnegie, John D. Rockefeller, and Leland Stanford amassed vast fortunes while engaging in questionable (environmental, equity, labor, monopoly) business practices. Then, they pursued philanthropy, almost as an afterthought, building hospitals, libraries, and even universities with their vast wealth.

Today, social entrepreneurs view their profit- generating activities and their positive societal and environmental contributions as simultaneous,

Professor Dunham

2

interrelated goals operating in harmony. The reasons for this shift are numerous and involve many stakeholders. Conscious consumers desire transparency and commitment to responsible practices (e.g. fair trade). Companies want to build long-term relationships with suppliers and ensure their well-being (e.g. creating shared value). Qualified employees in a seek out extraordinary workplace culture. Investors seek transparency and risk-reduction as environmental, social, and governance (ESG) investing gains mainstream popularity. Another factor is a decline in services traditionally provided by government entities, as well as an ideological shift towards a preference for applying the efficiency, innovation, and self- sufficiency of entrepreneurship to addressing social problems.

Social entrepreneurs may pursue a variety of goals including community economic development, ecological restoration, education, financial inclusion, health care, housing, internet connectivity, poverty alleviation, rural electrification, sanitation, water purification, etc. The following three social enterprises utilize different models to achieve their goals. The Delancey Street Foundation in San Francisco operates a public restaurant that serves as a self- help program that provides employment, housing, and training for at-risk, formerly homeless program members. The Grameen Bank, created by Muhammad Yunnis, provides small business (microcredit) loans to underserved populations in developing countries. The company Seventh Generation focuses on producing products that have a reduced environmental impact and donates ten percent of pre-tax profits to funding nonprofits focused on environmental and social issues.

Project Details: Students will be responsible for developing a business plan for a new venture that will have a positive benefit for society or the natural environment and provide a verbal presentation. This is an opportunity to share your passion for understanding and addressing a particular social or environmental problem of your choosing. If you are unsure of a problem to

address, reading quality news sources including The Financial Times, New York Times, San Francisco Chronicle, Wall Street Journal, and The Washington Post is a good way to familiarize yourself with current issues.

The structure of the written project is flexible, however, there are some key elements that are expected of any business plan. There are numerous resources on the web to help you get started in writing a business plan. See iLearn for some resources curated by the professor.

In general, a business plan should address:

1. The market, including existing competitors

and your proposed niche 2. A description of your planned product or

service 3. Revenue forecasts, prospective clients and

customers 4. Details for investors, including financial or

resource asks and terms

Given that the venture needs to focus on responsible business, you will want to provide:

1. An overview of the social or environmental

issue to be addressed 2. A description of the stakeholders involved 3. A critical discussion of how the new

venture addresses the problem

Although there is no set length requirement for the written business plan, quality plans are typically fifteen or more pages in length (Times New Roman 12pt. font, double spaced). The written portion will be submitted via Turnitin on iLearn. References should be cited in American Psychological Association (APA) format. Assignments will be evaluated using the following grading rubric.

Professor Dunham

3

Criteria (20% each)

Exemplary (100%) Good (80%) Adequate (70%) Poor/Incomplete (<70%)

Organization and Structure

Clear and logical organization and structure, use of a table of contents and an outline

Mostly straightforward organization and logical structure

Somewhat vague, missing key sections

Little to no organization, missing title, student name, or other essential information

Discussion of Problem / Stakeholders

Outstanding literature review including a synthesis of relevant academic and expert sources

Good use of current expert sources and accurate and relevant evidence

Sufficient use of some expert sources; some evidence is irrelevant or inaccurate

Insufficient use of current expert sources, citing Wikipedia, not citing others’ words and ideas, etc.

Market Overview

Excellent presentation of evidence, including quantitative analyses

Good insights; accurate interpretation of evidence; logical analysis of facts

Some insights; emerging ability to interpret evidence; some analysis of facts

Lacks insights; inaccurate interpretation of evidence; illogical analysis unlinked to facts

Strategy and Financial Information

Strategic plan, timeline, use of quantitative forecasts

Good planning and some use of financial forecasts

Sufficient planning and use of financial forecasts

Insufficient information

Grammar/ Spelling / Citations

Outstanding, citations and references are properly formatted

Good with minor mistakes

Some major problems

Many consistent and major problems