Does a business need to be a social enterprise to be socially responsible?

Does a business need to be a social enterprise to be socially responsible?

Lawrence Tomlinson, Guardian Professional


Social entrepreneur and Sunday Times Rich Lister Lawrence Tomlinson tells us how any company can generate social good


It is frustrating to me that the social benefit of successful business ventures is often overshadowed by so-called "social enterprises" when it comes to their positive impact on, and key role in, society.


My business, the LNT Group, is recognised as one of the fastest growing companies in the UK. The five core businesses within the group operate across a range of sectors including construction, care homes, software, cars, and chemicals. We create employment for 2,000 people and are passionate about providing great offers for customers, be that race cars or living in our care homes.


For 25 years, I have been working with and within communities across primarily the north of England. We’re creating a further 1,000 new jobs this year.


I ensure that all profits go back into the group to improve each of the businesses on both social and environmental levels, though a share of the profits does go directly to staff in the form of dividend payments on shares I have gifted to each of them.


Developing new business is paramount in creating jobs, but so is hanging on to the business you’ve already got. The construction sector has been decimated by the economic climate with thousands left looking for work.


Creating jobs in challenging sectors is essential for social wellbeing. Otherwise people can end-up on society’s scrap heap and some skills are lost never to return.


Creating opportunities in the form of apprenticeships plays a key factor in generating social good. Kids are becoming disillusioned with doing two or three years at college or university and creating personal debt only to then find that they don’t get a job. If you can start vocational training, whether in plumbing or car building, then you can help these people. A new business will need skilled people, but as new businesses generally can’t afford to take on apprentices, it’s up to the established businesses to create these opportunities.


Like the LNT Group, more businesses need to work with universities and schools to introduce apprenticeships. We have a responsibility to give tomorrow’s leaders the chance to learn a skill that will stand them in good stead to earn for the rest of their lives. TV programmes such as The Apprentice distorts people’s views of what apprenticeships are, and that is for people to learn skills that will last them a lifetime. Without creating these skills, businesses will have no future in the longer term.


There has never been a time when value has been more to the forefront of the public’s mind and businesses need to be cognisant of this in how it operates. The efficient management of cash is king – but this shouldn’t be to the detriment of your suppliers. Opportunities to vertically integrate, partner, improve, and generally make operations more efficient must be exploited with no stone left unturned.


Creating appropriate rewards for staff is a huge element in making them feel valued members of the business and society in general. This is not only about cash, but also about the time taken to communicate with them about the business and the confidence they have in your sustainability.


Why therefore is it so important that a business carries the "social enterprise mark" to demonstrate its positive impact on society when it’s plain to see that many of us are already doing this without qualifying in the "tickbox" system laid out by social enterprise experts? Has the criterion become that irrelevant? The fact is, businesses are more aware of the social and green challenges we’re faced with today, and a very large proportion of us are already making the changes happen.


Lawrence Tomlinson is a social entrepreneur, Sunday Times Rich Lister and chairman of LNT Group