Not Business As Usual!

As the chair of the Social Enterprise Alliance, I have the opportunity to address the annual Summit. I had a blast in New Orleans revving up the crowd about this exciting time for the Social Enterprise Alliance and the movement. Here's the text of my speech:

[long post alert]

Social Enterprise: Not Business as Usual!

Jim Fruchterman

Chairman’s Address to the Social Enterprise Alliance 2009 Annual Summit

The world’s a mess. I thought that would be news to you. We’ve got a lot of problems. We have a global economic meltdown. We have instability and violence all over the world. And we have this thing called the global climate crisis. It’s kind of daunting. The challenges of today’s world demand innovation because we can’t afford — business as usual.

I want to talk to you today about this moment in time, this great opportunity for us. We’re joining together to talk about the new face of business. An approach that puts social issues foremost; a strategy that delivers better results for far more people. Social enterprise — not business as usual.

We all know the limitations of the different traditional approaches to solving problems. Charity, business, and government, all accomplish great things but have their limitations. I want to start by exploring those limitations with you today.

First, charity. We know and value the charitable urge. There are so many times when human beings are in need, and they need our charity. When disaster strikes and people need water and shelter, they are not usually in a position to pay for that service. But charity misapplied is corrosive — when charity is more about the giver than the recipient. When charity goes beyond helping someone in need and creates dependency and even creates disincentives to self help — we can’t afford charity like that.

Next, business. I come out of the business sector and I admire what business can do in terms of creating jobs and new technology and new ways for people to communicate. Business is responsible for most of the medical advances we’ve seen in the past decades. There’s so much traditional business can do. But it does have its limitations. The market often fails to deliver what society most needs. Fails for people where the business community decides that the market is too small. Fails when they choose to market a product, but they leave out certain communities because they don’t believe those communities are sufficiently profitable to be worth selling to.

Additionally, and we see this a lot in the fields we work in, the people who most often need a product or service are often those least able to afford it. So we can’t afford traditional business as usual. Over the last decade, I would argue that large segments of the business community have become essentially immoral. These are the people that believe “the business of business is business” — that it’s actually immoral for a business person to consider social considerations in operating his or her business. These are the same people who said that the market would solve all problems and that more deregulation would be better. “Let us alone and we’ll do the right thing.” We’ve clearly seen how that’s worked out. Another example is the people who advocated pay for performance, and then promptly decoupled pay from performance. We most certainly cannot afford their version of business as usual.

And lastly, government. We know that government is rightly tackling many problems for our common good. Issues like education, health, employment, retirement. But innovation is difficult in government because of the constraints that government often operates under. It takes visionary leaders to try to create an environment for cultivating innovation in government. Today’s financial crisis has put government under tremendous financial strain. Right now it seems like we can’t afford government as usual.

As people of good will tackle these challenges of the status quo, we’re gathered here in New Orleans to talk about a new and exciting movement that offers a chance to blend some of the best of those three different sectors and to create innovative solutions to the problems at hand. Social enterprise is definitely not business as usual.

Social enterprises are fundamentally hybrids. We bring the heart of social mission to the market. If changing the world for the better is not your primary goal, then you’re not a social enterpriser. And I think that’s why most of us are here. The relationship that we have with the communities that we serve is fundamentally different than traditional charity. Our clients are customers; they are not the passive recipients of our beneficence or our charity. They are our active partners in changing the world, in changing society. The power relationship between us and our customers is different from that of typical businesses. That, I think, is at the core of all social enterprise. It’s not “we’re up here and you’re down there,” it’s “you’re our partners in making social change.” And so we aim to change the dynamics of business as usual.

Compared to the most extreme examples of abuses of business, social enterprises know better. Social enterprises in the opportunity finance area were not involved with predatory loans when deregulation happened or when regulations ceased being enforced. They knew better. Social enterprises understand that our primary responsibility is to act in the best interests of society. We’re often exploring the new frontiers of the enterprise world, boldly going where no enterprise has gone before. Most definitely not business as usual.

And as for government, we have a new ballgame today. We have political leaders with an active interest in changing the status quo— for finding innovative and scalable solutions to the challenges facing our cities, states, nation and the world. Today we’re not facing government as usual, but we have to be an active partner in making that happen.

As we gather the Social Enterprise Alliance together, we see exciting opportunities to work together to change the country and the world. I’m here because I want to help build that movement. I’m part of the Alliance because I know there are things that my organization alone can’t begin to tackle. But we together as a movement can make a much bigger impact on our society for our joint social mission. We need to work together to make social enterprise a much bigger part of the solution to society’s problems.

And we need your help to make that change. We have a new administration in Washington hungry for ideas that deliver results. We’ll have a new White House Office for Social Innovation that is already hearing from us — and needs to hear from MORE of us. We need you to help get involved in charting that course — as a movement, by getting involved as a member, by joining your local chapter, by starting a local chapter, by talking to your elected representatives, by advocating for the policies and the changes that will provide the capital needed to make the impact the social enterprise movement is capable of on a national level.

We’ll hear exciting ideas here in New Orleans. Great stories from social entrepreneurs about how their unusual business ventures make social change. We’ll hear from our new chapters about how they are assembling like-minded people in their communities to get together and talk about how to make social change.

When I was a business person, the most valued advice I ever got was from my peers. We would talk about the things that my board wouldn’t talk to me about, that I couldn’t talk to my staff about. That’s what chapters and what this annual Summit provide. A chance for peer interaction and advice to help you solve the most challenging problems, because in this room there are several people who have already solved the biggest problem you’re facing right now. Ask them about it. Test it out. We’re going to hear from those people.

We’re going to learn about “how to” and “what to” and “why not” in many different sessions, both in the seminar rooms and in the hallways. And we’ll celebrate the successes of the leaders in our community who are working on creating hybrid forms, actually corporate forms that help meld this hybrid nature of the social enterprise. There are exciting new forms like the L3C or the B Corp that address how to balance social mission with business. And there are people working on more.

We’ll travel outside the United States to explore amazing and inspirational social enterprises not in our country. Having attended the Social Enterprise World Forum in Edinburgh, Scotland last year with Kris, our CEO, it’s clear that the UK is five or ten years ahead of us in social enterprise. We have a lot to learn from other countries in how we can make social enterprise a much bigger part of our movement. In the UK government thinks more and more about turning to social enterprise to deliver social services rather than traditional business or government solutions. We’ll also hear from policy makers and activists working to change laws and unleash capital for social enterprises. The top performing asset class for the last year was social investing in opportunity finance. People who invested in top micro-credit enterprises making low-income housing loans such as Self-Help in North Carolina — good loans, not the predatory ones — realized three or four percent yields, which these days looks pretty good.

There were foundations that were told that it was against their fiduciary duty to make investments in social enterprises. I think the experience of the last year has changed that view. But we have to encourage that forward movement. By tackling all of these issues, we’re going to be encouraging them. We’ll be doing all those things and we’ll be doing more.

So as we mark this 10th summit, let’s join together to fight the forces of business as usual.

Do you believe traditional charity alone will bring the lasting and sustainable change that our communities need? I don’t.

Do you believe that traditional business alone is going to do the right things for society’s disadvantaged — the people who often most need the products and services of business but are least able to afford it? I don’t.

Do you believe that traditional government approaches alone are going to bring the innovation and effectiveness that our global crisis so desperately demands? I don’t.

Traditional charity, business, and government approaches alone are not going to be able to do this.

I know that we all believe that social enterprise is a crucial part of the solution. The solution that charity, business, and government need to get us through this crisis. Together we can build the more sustainable and just world that we all know is possible and forever change — business as usual!

Bookshare Announcements

The Bookshare team has been attending the summer conventions of the two major blind consumer groups, the NFB and ACB. We had great user parties, listened to our users and talked to other key players in the accessibility field.

We also announced a couple of assistive technology partnerships. The
first release was about support for mobile phone use with software developer Code Factory of Spain. It still takes downloading the book to a PC and transferring it to the cell phone, but I'm looking forward to getting rid of that extra step!

The second announcement was by Plextor of Japan, about their new ebook player that will play Bookshare books. The device also allows users to record their own audio books.

The last item I wanted to highlight was a White House blog post with President Obama hosting a delegation of people who are both deaf and blind. I was just delighted to see this quote from the post:

This visit was not and should not be viewed as a sympathetic thing for the President to do. Rather, it reflects this President’s commitment to, and understanding of, the desire for all people with disabilities to be fully integrated into society.

Amen!

Major article on Benetech

It was exciting to note the publication of my big article on Benetech in MIT Press' Innovations journal. I just received the PDF and was able to post it on Benetech's site.

As many of you know, I'm committed to doing a book (and am holed up at Caltech's Athenaeum this week working on it). This article was my first big step in writing up some of Benetech's history and why we do what we do, and the process of working with the editors gave me a taste of what I'm in for with a book!

Craigslist Foundation Bootcamp 2009

Enjoyed my day in Berkeley yesterday at the Craigslist Foundation Bootcamp 2009. They had more than 1000 folks show up to talk about service, nonprofits and social action. I thought Arianna Huffington did a good job as the opening keynoter hitting on the service theme. Announcing All For Good was a big piece of the event, of course.

Randi Zuckerberg of Facebook had the tough gig of presenting a lunch keynote outside under a tent in lower Sproul Plaza (mucho noise and people talking). She was much more on Facebook marketing message, but of course that's her role at FB. Lots of enthusiastic FB users in the audience helped make her points.
I took a lot of pictures, but not that many turned out. Posted the best 30 or so on Flickr: got some great ones of Steve Wright of the Salesforce Foundation.

I enjoyed some of the breakout sessions, although the number of concurrent sessions (often 8 at one time) made it hard to pick. Enjoyed Deb Jospin and Shirley Sagawa discussing the Charismatic Organization, their recent book.

And, as always, great to see people I know and admire like Darrell Hammond of KaBoom!, Ami Dar of Idealist.org and Jonathan Greenblatt of more cool things than I can shake a stick at!

AARP covers Bookshare!

We had a nice piece on Bookshare in the latest AARP Bulletin, entitled: Making Books Accessible for Those With Disabilities.

We've been getting lots of questions about the article, including volunteer offers (yay!) and interest in getting Bookshare for older parents. We have shared with people that it's ok for children of disabled parents to download books for their parents, just as it's ok for parents to download books for children with disabilities. Our team has been explaining how to assist a disabled senior who doesn't have a PC, by empowering a PC-using child to download the book and load it onto a device like a Victor Stream (an ebook player that has a voice synthesizer that speaks our books). These kinds of devices are much more like the tape recorders and CD players with which non-PC users are familiar. Of course, we explain that access to Bookshare is only for the purpose of helping a person with a print disability.

It's always exciting to be covered in the press, and AARP is an organization that has long been on our list of places from which we'd love to get coverage.

Fascinating Meeting at the Copyright Office

Last Friday I spent almost two and a half hours in a wide-ranging conversation with Maria Pallante and Michele Woods of the Copyright Office (Michele's name updated, plus a summer law clerk attended). I came away with a much better understanding of the issues they are exploring and certainly did my part to articulate why I support the positions we have.

[Long post alert!]

I would characterize the atmosphere as one of informed and intelligent skepticism on the part of the Copyright Office, with many questions exploring different positions. We discussed Chafee, especially in the context of the Amazon text-to-speech brouhaha, and the proposed international treaty that was tabled at the WIPO SCCR meeting in Geneva last month.

The Chafee Amendment
The U.S. copyright exemption for serving the print disabled is commonly called the Chafee Amendment: Section 121 of copyright law. It’s what makes our Bookshare service legally possible.

The fact-finding public hearing and request for comments seemed to have two purposes: both to understand how Chafee is working and to report back to WIPO about the U.S. national experience. In our conversation, I got the impression that the Copyright Office is getting ready in case Chafee is revisited. That would be the responsibility of the Copyright Office, to advise Congress on any changes to domestic copyright legislation.

That worries me, because I don’t think I’ve heard about a groundswell of demand for changing Chafee in the United States, other than when one textbook publisher's representatives get up in public and sound like banking executives from five years ago (if the government would just stop regulating us, we'd take care of everything). So, I think advocates should be watching out for any signals along these lines. Of course, if there is an international treaty on the topic and the U.S. ratifies it, then there probably would need to be changes to Chafee and U.S. copyright law.

The Amazon Text-to-Speech issue

This one has gotten a lot of press, especially since the National Federation of the Blind and the Reading Rights Coalition has formed to fight the soundproofing of books on the Kindle2. The most interesting part of the conversation was around what I call the “dueling moral high grounds” issue: authors rights and the rights of people with disabilities. The Author’s Guild asserts that they control the audio rights and that delivering a text ebook to a device which could speak it aloud with synthetic text-to-speech and that their commercial market for audio books will someday be significantly affected by TTS. The Reading Rights Coalition is fighting against being locked out of these books by DRM, what is often called soundproofing the book after the paper George Kerscher and I wrote years ago.

My main point is that the two high grounds are not the name in impact. Authors are fighting over how much money they get: it’s clear that they are being paid. The disabled community’s point is that they are being locked out of their right to read by a concern about the level of compensation to authors. And, it’s not even clear the authors would get more money short-term by locking out disabled people. I actually think they’re getting less by stopping people from buying ebooks who are unlikely to buy audio books at higher prices. When you’re contrasting the “maybe more money for authors” against the civil rights of blind and print disabled people to be treated equally, I proposed you have to come down in favor of the civil rights of disabled people.

Of course, the Librarian of Congress has pronounced on this topic already! Don’t forget that the he said it’s legal for blind people to break off the DRM on ebooks they buy so that they can listen to them.

We did some exploration of the likely impacts on the market for audio books: that seems to be one of the major policy concerns about the text-to-speech issue. Putting on my technical hat, I pointed out that the technical advances needed to make synthetic speech a reasonable alternative to human narration were years away and that gave author’s plenty of time to price these conditions into their negotiations with publishers. Of course, very few authors will have the power in practice to negotiate these terms, but it's a long way off before TTS can touch human narration from a market standpoint.

We believe that print disabled people should be able to buy accessible books at the same time and at the same price as nondisabled people. It’s the right long-term solution. But, we’re not willing to lose the copyright exemption and let down the next two or three generations of print disabled people during the transition to equal access nirvana!

Geneva, WIPO and the SCCR

Our final conversation was about international issues around access for people with print disabilities, based on the recent meeting of WIPO's Standing Committee on Copyright and Related Rights("SCCR"). The hot topic was the proposal made by Brazil, Ecuador and Paraguay, for a global treaty (a treaty for which I was part of the expert drafting team). The goal of the Treaty in rough terms is to set a Chafee-style exemption as a norm around the world, and enable cross-border sharing of accessible materials. One of the big problems today is that copyright exemptions only work in one country at a time, and that materials produced under a copyright exemption in one country can’t be shared with disabled people in another country.

My summary of where the issue is generally: the developing world and people with disabilities are for the treaty, and rich countries and the publishing industry are against the treaty. The publishing industry has put forward an alternative to the treaty called the Stakeholders Platform which is based on voluntary action, which the disability community feels is the status quo, which is not good enough.

Nothing I heard from the Copyright Office made me think they were pro-Treaty. They did confirm that the statement that Kareem Dale of the White House gave me earlier in the week did represent the official position of the U.S. Government, and it talks about being interested in working on addressing the problem and discussing a wide range of solutions including the proposed Treaty. But, the advocacy groups present in Geneva felt that the U.S. delegation was against the Treaty solution.

There seems to be a concern about importing accessible books into countries where the publisher hasn't actually published the print book. These seems to be an important part of international copyright law. Of course, my pragmatic view is that many, many people can simply order books from the UK or India today over the Internet, and I didn't see a reason to deny a person in the developing world a book they need when the publisher didn't bother to publish the book in that country.

In Geneva, the US government did provide a statement as a result of their fact-finding work about Chafee. But, it mainly talks about the complexity of the issue. Pallante did point out that the U.S. did support the final statement which approved discussing the Treaty proposal in the next SCCR meeting.

I think that the advocacy community has an opportunity to continue to lobby the U.S. government to try to get it to actively support the Treaty. It sounds like there will be more public input on these issues in the future, getting ready for the next SCCR meeting. We have multiple places to lobby: the Patent and Trademark Office (apparently the “lead agency”), the White House, the State Department and of course Congress and the Copyright Office (which is linked to the Library of Congress). Given that the Obama Administration is still in the middle of making many political appointments, the key position of Director of IP (bow to Richard Stallman who detests the term 'intellectual property') at the PTO is still vacant.

We discussed why I thought now was a good time for a treaty: shouldn’t there be more effort at the national level first? I pointed out that the disability community had just been part of negotiating the Global Convention on the Rights of People with Disabilities and that the community was experienced using a treaty approach to secure rights globally that in many cases had been in place in the richer countries. The need for an exemption is even greater in the developing world, because disabled people are really at a much greater disadvantage. Blind people in the U.S. can realistically talk about buying Kindles because of decades of civil rights action and legislation (and the battle for equal opportunity is nowhere near over here in the U.S.). Disabled people in the developing world are the poorest of the poor.

One point that the Copyright Office made is that the U.S. already has a good copyright exemption in place, as do many of the richer countries. Of course, one of our advocacy positions is why would the U.S. be against duplicating in the world a policy approach that is used here with great success? We just need to make sure that any global treaty that is negotiated doesn’t make things worse for people with disabilities here in the U.S.! But, it does make it somewhat harder to get the advocacy juices flowing here in the U.S. to support a Treaty that would mainly help people with disabilities outside the U.S.

Disability advocates have been asking me how they can help increase the chances for this effort. I'm not the best person to advise on advocacy strategy, but I've certainly heard from the advocacy professionals that this treaty needs the support of the Obama Administration. So, there will need to be advocacy on the different agencies that will participate in drafting the approved positions for the delegation to the next SCCR meeting in November. I understand that there is a WIPO general assembly meeting at the end of September, and that there may be an attempt to kill this then (I don't have a clue how that works).

So, listen for the next round of public outreach and respond then with why you support this treaty. And, if you can, lobby the White House, Congress, the PTO, the State Department and the Copyright Office to back this. Enlightened disability legislation is a proud American export!

At Bookshare, we are especially interested in reaching out to the disability communities in the developing world. They need what we have more the most, and our efforts to make our books accessible on inexpensive devices like cell phones and MP3 players will be even more important there. Right now, we're relying on the good will of the publishers (and there is a lot of good will there) to voluntarily allow us to export a small percentage of our books with their permission internationally. But, the idea of Bookshare is to empower the community to play the largest role in solving the book access problem. We need domestic copyright exemptions so that local communities can scan the books they need in their languages. And, we're standing by to provide the technology infrastructure that makes this community action possible.

The Craig Newmark Beneblog Interview

Just had a good conversation this morning with Craig Newmark of Craigslist and the Craigslist Foundation. There are two hot issue right now on Craig's social action radar, the new launch of the All For Good website and next weekend's Craigslist Foundation Boot Camp in Berkeley.

On Craig and Craigslist

Q: Do you consider yourself a social entrepreneur?
A: No, I don't think of myself that way. I may be one, but it seems to have too many syllables. I think of myself as a nerd.

Q: Tell me about the balance between the two bottom lines of Craigslist as a social enterprise.
A: We are wholly driven by our community. We ask them what they want and need, and then we do it the best we can. Then we go back and ask again. Jim [Buckmaster] runs the business. I was influenced back in 1976, when I was considering a job with IBM, by reading a quote from TJ Watson (Sr or Jr) about how if you took care of the customer, the business takes care of itself.

Q: Do you have explicit choices to make trading off the two bottom lines?
A: No, it more sorts of rolls along from our approach [focusing on the community]. We know that we're not maximizing our profits by sticking to our focus.

All for Good and Service

Q: You're just announcing All For Good: what's the goal?
A: There are a lot of people these days who want to help other people out. All for Good makes that easy. The President is focusing on service.

Q: What's the connection to Craigslist?
A: All for Good's spirit is the spirit of Craigslist. Simplicity. People working with each other.

Q: What's the difference between All for Good and other service websites like VolunteerMatch, Network for Good and Obama's Serve.gov?
A: More will be revealed. These sites should be working together using technology like RSS feeds. And All for Good does draw on feeds from other sites. We're all in this together in service. If we’re serious about service, we’ll work together.

Q: What's your linkage to service?
A: Well, I'm going to stick to customer service! Other people are good at other things. For example, you can see that Arianna Huffington is much better at writing in her post:"All for Good: A New 'Craigslist for Service'"! I'm not going to quit my day job in customer service. There are different variations of public service. Customer service is a form of public service. Customer service is done with good will and in conscience.

Q: What are the top three forms of service you're trying to promote?
A: No top three. Service to others takes different forms. Our government's public servants have been released to their jobs better. They're now allowed to do their jobs. My role is to now and then draw attention [to their service]. Examples like the TSA and EPA blogs. FDA transparency effort. US Military Southern Command blog. White House blogs, open government initiatives. The administration is trying to scale up grassroots democracy, people in the White House like Vivek Kundra, Beth Noveck, Aneesh Chopra, Brian Behlendorf. [Updated list with names I missed]

Q: Do you have a strategy or roadmap for these social actions that you’re following for Craigslist or yourself personally?
A: These aren't Craigslist projects: they are me acting as an individual, and/or the Craigslist Foundation. Things are changing in our country with a new civic engagement. I think of people under 30 as the new civic generation, much like the GI generation. People like me help get the word out. We need ways to make it easy, ways like All for Good.

Q: What things are you working on?
A: For me specifically, government and social media (and not just Washington), social media, the Sunlight Foundation ( on government accountability and transparency, data.gov, etc.) Also working with Iraq and Afghanistan Veterans of America to help get them the respect and services they deserve, working on reform of the VA. I also want to mention Consumer Reports. They help us all with refrigerator reviews and the like, but they are also in the vanguard of health care reform.

Techies getting more socially engaged

Q: Many people in the tech field want more meaning and more social impact for their lives. What is your advice about what they should do and how they should go about doing it?
A: Get involved, All for Good makes that easy.

Q: What’s your advice to them on going local vs. national vs. global?
A: Think globally, act locally is the cliche, but there's a lot to it. Of course, people dedicate their lives to service in many ways, joining the armed forces or the Peace Corps, becoming teachers, firemen, policeman. That's by no means as exhaustive list, but a big deal for me to support people who serve.

Q: Are there things that techies can specifically do better?
A: Nerds can help. They can build technology like All for Good, that help people connect. Help build tools that allow us to look into government.

Q: Do you have suggestions or advice to the tech billionaires about deploying their personal fortunes?
A: I don’t presume to tell them to do with their money. But it is worth mentioning that Steve and Jean Case (of AOL) are doing some great things.

Q: Any final comments?
A: Looking forward to seeing people next week at the Bootcamp!