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In a recent discussion posted on Social Edge I used the term “social business” to describe as part of my initial post. This was challenged by one commentator who said our definition was “totally UK centric and, in many respects, unhelpful to others outside the UK”. When I pointed out that the terms social business or enterprise were no more or less parochial than the term “not-for-profit”, which Americans use freely, and without regard to national sensitivities, this particularly gallant individual was extremely gracious in his reply. The point here is not to brag about a small point won, rare though that may be, or to compliment a particularly noble commentator, but to directly address the vexing question of language and terminology. No issue seems to occupy people in our sector more than language and the definition of terms. I have always found these debates rather wasteful and a bit sad, but wanted to delve into this a bit deeper to see if something useful can be gleaned. If you share my fascination or frustration with the time we spend on “terms” than join me and read on.

Firstly, it needs to be clear that a certain amount of defining is essential. Whether we are speaking amongst ourselves or to outsiders it is incumbent upon us to say what we mean when we use terms that are not part of common language. This clarifies our approach and our bias and is a matter of common courtesy and professional integrity. At ClearlySo, right off the homepage, we have a button which links to our definitions called “What actually is a social business?” We use this term (Social Business) instead of others because we generally accept others’ definitions when it comes to concepts like “philanthropy” or “social enterprise” but have worked hard to define a social business as we use it on the site and in our business. This is explicitly NOT because we believe our definition to be “the final word” on the subject–far from it. We simply think our readers deserve the courtesy of knowing where we stand and also that as a participant in the sector we should help to participate in moving things forward. On the specific question of what is a social business we felt there was a great deal of ambiguity in the UK–we felt obliged to make a contribution.

We have been approached by folks associated with the Nobel prize-winner Mohammed Yunus, the founder of microfinance (with Grameen). Our definition of social business disagreed with theirs and they were advocating their view. The fault line had to do with profits and the very nature of the organisation. In our definition, profits to investors are OK and the ultimate purpose of the business may be financial as well as social–in the world of Yunus this was not acceptable–the business needed to be predominantly about social impact. We agreed to disagree. Apparently those in the Yunus-phere are keen to convert others to their view. Our approach is different, we feel compelled only to define what we mean, in a way which suits us and our purposes. If others have definitions which work for them–great. Frankly, if their terms suit our needs better than ours we would gladly replace our own.

I do wonder why people have so much invested in our definitions of terms. Partly it may reflect our passion for the sector. On some level, it may reflect business interests. How things get defined may impact business and funding opportunities. I think on some level it is evidence of a desire to control. Having defined something and then working to that definition, I suspect many are enraged at the loss of control that comes from a redefinition. We have called the investment in unlisted social businesses “social venture capital”. Along comes the Rockefeller and the Monitor Group and they use the term “Impact Investment”—how enraging! Once we calmed down though, we realised it was simply a superior term and adjusted accordingly. Such progress is to the good of the sector.

On respected expert in the field said, according to another observer, that “”we don’t need more terms, we need a common understand of the terms we have.” Apart from the appalling English such a statement reflects a common desire to have all things rest after one particular individual has arrived at his definitions. I can imagine the guardians of Webster’s Dictionary (this was said by an American, otherwise I would have cited the Oxford English Dictionary) were aghast at the conversion of “understand” from a verb into a noun. There is an unsurprising desire to see these definitions last for eternity, I imagine, but this is not in the broader interest of our sector.

Our difficulties exist despite the fact that many of us operate in English. Even in the English language meanings can differ greatly when used in non-English speaking countries. For example, the term “social economy” has a very different meaning in the UK than in Germany. And the term “social business” has a very negative connotation in Serbia, where it has certain political undertones.

Despite all the above, I would not call for an attempt at harmony. A free and open marketplace of ideas is the best way to move things forward—from a linguistic and a practical standpoint.

Rodney Schwartz

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