Saying that the traditional mode of doing business has failed to reduce poverty in the country, it is time to adopt the new business model of social enterprise.
Coop Natcco partylist Rep. Cresente Paez stressed this point during a conversation we had over Co-op TV. The episode airs in CCTN Channel 47 this Saturday, January 03, 2015 at 6 a.m. and 5:30 p.m.
Congressman Paez leads the political arm of the National Confederation of Cooperatives in the House of Representatives. The partylist group’s second nominee is Rep. Anthony Bravo who represents Luzon in the vast network of 662 cooperatives and NGOs spread over 130 cities and 77 provinces throughout the country. In the current Congress, Paez chairs the committee on cooperative development.
As the Coop Natcco’s first nominee, Paez represented the sector in the 11th Congress, in the first-ever partylist election held in the country in 1998. Coop Natcco was unable to win a seat in the 12th Congress after Comelec disqualified the partylist group, but the ruling was overturned and from 2003 up to the present, Coop Natcco has successfully raised the coop banner by winning two seats in the 13th and 14th Congress.
Because our political system is akin to the movie industry where only the popular, controversial and notorious members get media mileage, only a handful of “partylisters” get media attention even if some of them merely mouth anti-government propaganda.
However, the New Year might bring some new developments because some progressive lawmakers like Walden Bello, representing Akbayan partylist, and three other congressmen from mainstream political parties have banded together to push House Bill 1331, otherwise known as the Poverty Reduction through Social Entrepreneurship bill.
The measure is seen to boost some 30,000 existing social enterprises (SEs) in the form of cooperatives, corporations, single proprietorship entities, non-government organization-assisted enterprises. This is a noteworthy constituency that has over the years contributed to poverty reduction and mitigation of the ill-effects of climate change. Coop members and their allies in NGOs number over 13 million. If they are united, I think they can even elect a president.
Anyway, Paez told this corner that the focus of HB 1331 is basically poverty reduction “using business methodology, strategy and business solutions”.
What sets the SEs apart from the traditional business model is the motivation behind the enterprise which is not profit, but to facilitate the development of people through business activities that adhere to fair trade practices and business economics aimed to produce goods and services that will penetrate the market, which means they should be competitive enough to be the preferred product in the market.
In sum, the practices should enable SEs to generate profit not just to survive but to fulfill its core mission of developing people and communities. This will be possible because 60% of the profit should be returned to the community in impact projects that would give people access to water, education and health.
To benefit from the incentive package offered to SEs, they need to apply for accreditation and recognition by the government through an agency attached to the Department of Trade and Industry. Incentives include tax relief, exemption from VAT, plus a guaranteed share of 10 percent or even more in the public sector budget allocated for enhancing public services in education, health, social services and many others.
This is the second time that Paez is championing the SE bill in Congress. I think the timing is just perfect because the counterpart bill in the Senate authored by Sen. Bam Aquino was already passed. The House version was practically crafted by the SE sector spearheaded by the Institute of Social Enterprises in Asia (ISEA) and the Foundation for A Sustainable Society, Inc. (FSSI), according to Paez.
I support the SE measure because the overriding concern is poverty reduction. But in the course of battling this national malady, the enterprises sector will cut its teeth in fair trade practices that secure the welfare of workers, preserve and protect the environment and ultimately secure justice and equality for all.
I am writing about this as my first article for the New Year because it is necessary to inform people that there is a new business model that, if properly handled and managed, can reduce if not eliminate the scourge of poverty.
For lack of space, I will write more about the SE measure in succeeding articles. For now, I wish to thank CDN readers for making our corner a part of their journey during the past year. With the SE measure as backdrop, 2015 should be a bright year for all of us, so here’s wishing one and all a very happy and prosperous New Year!