The Awakening of Social Enterprise in South Korea: Part 2

In 2007, the Korean government enacted the social “Enterprise Promotion Act” for the creation of employment as an alternative toward preventing higher unemployment. When it came to Korea’s social enterprise, an economic mutation was born out of failures of the Korean government and the markets that failed to upkeep. A social enterprise is an organization that applies commercial strategies to maximize improvements and environmental well-being, rather than maximizing profits for external shareholders. This organization is engaged in business activities by producing and selling goods and services while pursuing a social purpose of enhancing the quality of life for local residents by providing social services, such as creating jobs for the disadvantaged who have difficulties in getting necessities needed for survival, due to education, healthcare, and social welfare market prices being too high to achieve.

In contrast with a social enterprise, many commercial enterprises consider themselves to have social objectives, but commitment to these objectives is motivated by the perception that such commitments will ultimately make the enterprise more financially valuable. In short, commercial enterprises can operate only for their own profits, but social enterprises can also share their profits by investing in the society that helps them thrive.

The most successful social enterprise in Gwangju is the “Beautiful Store.” The shop sells back recycled items donated by residents to local poor residents at a very cheap price. All of the profits are given back to the local people or groups in need, and the remaining items are then sold to other developing countries. This efficient economic cycle and productive use is possible with many people participating, with aid for the disadvantaged, sales of recycled items and redistribution of recycled items. Nothing is wasted in this social enterprise, and social responsibility is directly pursued to raise funds for charitable projects.

Moreover, the fact that many volunteers participate in its business activities shows a real example of how a mass campaign for change can encourage all people to improve their regions and the world, by making commitments of participating in economic activities.

The large gaps in wealth between the rich and the poor is largely due to economic rules which cannot control the markets or the economy. These rules require various, flexible and complementary economic activities that can cope with the failures of the government. However, the market economy for creating jobs and improving the social well-being of the people can be directly altered by the utilizing social enterprises as the most efficient economic system to deal with imminent economic and social problems.