1 An Overview of Hong Kong’s Social Enterprise

Social enterprise is a form of hybrid organizations that aim to create social and commercial value (Battilana and Lee 2014), or businesses that aim to achieve social goals (Peredo and McLean 2006; Mair and Marti 2006). Social enterprise has many faces and has gained interests across different fields, from business and management (as hybrid organization and organizing), social work (as the application of business principles in social work practice), non-profit (as the marketization of non-profit organizations), economics (as the mobilization of private capital to create public good), public management and administration (as the new solution to traditional sector “inefficiencies”) (see a review by Chandra et al. 2021).

Compared to other countries and territories, Hong Kong is a relatively late comer to the practice of social enterprise and social entrepreneurship. To date, there is no official or legal definition for “social enterprise” (SE) in Hong Kong. In general, there is a common understanding in Hong Kong that an SE is defined Footnote 1 as a “business to achieve specific social objectives” such as providing the services (for example, support service for the elderly) or products needed by the community, creating employment and training opportunities for the socially disadvantaged, protecting the environment, funding its other social services through the profits earned, etc. As such, the definition of SE in Hong Kong is quite consistent with international definitions above.

The idea of social enterprise in Hong Kong was born out of the innovative ideas of various actors towards the end of twentieth century (circa 1990s), long before it became popular and received formal government intervention. In its early days, social enterprises in Hong Kong emerged as small-scale cooperatives that were set up by non-profit organizations (NPOs), charitable organizations or labor unions. These organizations operated their own businesses to ensure financial sustainability while at the same time seeking to benefit disadvantageous groups in society (e.g., people with disabilities, families from lower social economic status, lone elderly with minimum economic means, etc.). Hong Kong’s social enterprise sector is also unique as it became legitimate by the government endorsement (Chandra and Wong 2016).

1.1 The Rise of Prototypical Social Enterprise

A prototypical social enterprise emerged in this period––legally as an NPO––but technically embraced an innovative and unconventional business model called “Care on Call” (Ping On Chung or 平安鐘 in Chinese) and that was launched by Senior Citizen Home Safety Association (SCHSA) in 1997. This care call operation is a comprehensive 24/7 support service for the elderly, providing emergency aid, integrated care, around-the-clock vigilance service, health management, and day-to-day living assistance. Although SCHSA is a non-profit charitable organisation, “Care on Call” (平安鐘) started as a self-financing model since day one––thus making it de facto the first “social enterprise” in Hong Kong. Today, it remains one of the most established and most respected social enterprises in Hong Kong. The success of this SE has far reaching impact which has inspired and influenced public policy and how the government thinks about its role in the society and what it can do with the social enterprise sector in the twenty-first century.

1.2 The Crisis and Opportunities That Drive Social Enterprises

Partly in response to the 1997 Asian Financial Crisis and a growing burden in annual budget for social welfare (see also Chandra et al. 2021), at the turn of the twenty-first century, the Hong Kong government implemented welfare policy reform––among which one of its signature products was the Lump Sum Grant Subvention System (LSG), which still exists today. The goal of LSG was to enhance the efficiency and effectiveness, improve quality, encourage innovation, strengthen accountability, and provide flexibility for non-profit organizations, with a view to better meet the changing needs of the society. From this point, we witnessed an influx of NPO-operated social enterprises such as iBakery by Tung Wah Group of Hospitals (TWGHs), Green Ladies by St. James’ Settlement, Fullness Salon by Fullness Social Enterprise Society, Cafe330 by New Life Psychiatric Rehabilitation Association (Au 2014).

Driven by the efficiency and innovation spirit, the government launched the “Enhancing Employment of People with Disabilities through Small Enterprise” Project Footnote 2 (or “創業 展才能”計劃” in Chinese) in 2001, which is still managed by Social Work Department to date. The objective of the Project (also commonly known as the 3E’s project) is to enhance the employment of people with disabilities through market-driven approach and creation of work opportunities for people with disabilities. Through seed money––of a maximum of HK$3 million for three years––granted to NPOs, the Project supports the creation of “small enterprises” to enable people with disabilities to experience genuine employment in a caring and supportive work environment. Consequently, several government-subsidized shelter workshops under NPOs and charitable groups have converted themselves into self-sustained social enterprises.

In 2006, the government introduced another important funding scheme called the Enhancing Self-Reliance Footnote 3 (ESR) through District Partnership Programme (or “伙伴倡自強”社區協作計劃 in Chinese) which provided seed grants for eligible organizations to set up or expand social enterprises that aim to provide job opportunities for the socially disadvantaged groups and/or product and services meeting their specific needs. ESR was set up with a view to achieve community self-reliance and social integration via project funding that typically last for three years and with the upper ceiling of HK$3 million. ESR requires that the funded SEs to become commercially sustainable after the funding period ends. It also encourages innovative ideas with SE business model to fill the gaps in the community and market. This further spread the seeds of social innovation and social entrepreneurship concepts in the territory.

During the period of late-2000s to mid-2010s, social innovation and social entrepreneurship gained official endorsement by the government to drive the SE movement. The high-level Commission on Poverty––which was then led by Mrs Carrie Lam––and other government bodies helped establish the Social Innovation and Entrepreneurship Development Fund (SIE FUND) in 2013. SIE FUND as a funding body aims to contribute to alleviation of poverty and social exclusion through innovative approaches by facilitating cross-sectoral collaboration (e.g., business, academic, NPOs, and the public) and leveraging the social capital of intermediary organizations (e.g., Good Seed as intermediary organization, based at the Hong Kong Polytechnic University (PolyU), Food Support Flagship project with St. James Settlement as intermediary organization, and Community Housing Movement with Hong Kong Council of Social Services as intermediary). SIE FUND mainly offers funding (i.e., grants) to innovative projects and entrepreneurial businesses at various stages of development to achieve their stated aims.

1.3 Cross-Sectoral Collaboration for Social Enterprises

The SIE FUND’s and other government’ driven efforts to support SE were not futile, as they triggered the business sector joining the SE movement. SE was also felt like a fresh air for the stagnating corporate social responsibility (CSR) in Hong Kong during that time; SE became fashionable as a new channel to invest in CSR activities. For example, a growing number of large corporations started to sponsor or co-organize with the government, NGOs, charitable groups, and educational institutions to form funding programs (e.g., Wofoo Enterprise launched Wofoo Social Enterprise; Jockey Club and SIE FUND sponsored the “Good Seed” in the Hong Kong Polytechnic University), incubation platforms (e.g., SIE FUND and Hong Kong Council of Social Services that launched Impact Incubator), and venture philanthropy (e.g., Social Ventures Hong Kong) and impact investing organizations (e.g., Dream Impact by businessman Mr Y S Lam and partners). A closely related concept to CSR was Creating Shared Value Footnote 4 (CSV) which has seen several large corporations collaborating with SIE FUND to deliver projects that alleviate poverty and social exclusion. Examples include Mass Transit Railway Corporation’s Youth Training Programme, IBM’s expert volunteering to support NPOs, and Stan Group’s revitalization of old buildings into co-working space to support new entrepreneurs.

Another key development for this period was the establishment of several major intermediaries and platforms as well as established higher learning institutions providing support to and connection among social enterprises. These include:

  • Hong Kong Social Enterprise Summit––or HKSES, an annual forum that started in 2007––with the objective to advance social entrepreneurship and social innovation. Its main activities include organizing a flagship international symposium (featuring local and international speakers, delegates from the civic society, businesses, government and academic sectors from Hong Kong, Asia and beyond) and community engagement activities to expand the participation and reach towards a social innovation movement.

  • Social Enterprise Business Centre or SEBC––a unit under the Hong Kong Council of Social Service (HKCSS)––which is sponsored by the government and a large corporation with a mission to support social enterprises and their beneficiaries, including SE hotline, capacity building program, consultation service and funding support. SEBC has a social enterprise directory with more than 600 members. SEBC regularly updates the newly minted social enterprises in its directory.

  • Academia and learning communities across the eight University Grants Committee-funded higher learning institutions including––mainly The Hong Kong Polytechnic University, The University of Hong Kong, Chinese University of Hong Kong, and Hong Kong University of Science and Technology––as well as private institutions such as Tung Wah College. The dozens of courses as part of teaching and learning as well as competitions and academic research from these universities were critical to the propagation and creation new ideas of social enterprises and in stimulating public interesting including youths on the potential of social enterprises (see a report by Hazenberg et al. 2019, commissioned by the British Council).

Since 2010 onwards, there have been an influx of private-operated social enterprises––mostly funded by private capital that added to the diversity in the models and practices of social enterprises in Hong Kong. These include social enterprises such as Dialogue in the Dark (now Dialogue Experience)––a guided tour in the darkness that employs the visually impaired, LightBe––an innovative alternative housing solution, Diamond Cab––a specialty taxi social enterprise, Fullness Salon––a work integration social enterprise that works with deviant youths, Longevity Design––a renovation service social enterprise, to the Good Lab––consulting and training organizations for social enterprise. Quite interestingly are the growing number of youths who see social enterprise as a constructive way of tackling Hong Kong’s problems such as EldPathy––an elderly simulation program, InterCultural Education––a cultural and global awareness building programs for students, Green Price––an online social grocery store, and ReBooked bookshop––established by a 15-year-old student.

1.4 The State of the Art of Hong Kong’s Social Enterprises

To date, we are witnessing a significant development of the SE movement in Hong Kong. From just a few social enterprises in the 1990s, the number of social enterprises has grown to close to 500 in 2015 (South China Morning Post 2015), approaching 700 Footnote 5 in 2021 (SEBC 2021). The COVID-19 pandemic had negative effects on the survival of many smaller social enterprises and could have increased the mortality rate and decreased the total number of social enterprises (South China Morning Post 2020). A recent study by British Council (2020)––using a more relaxed assumptions of “social enterprise” where organizations self-reported whether they did good for the society––reported that there were 5700 social enterprises in Hong Kong. While this survey may have overestimated the actual number of social enterprises in Hong Kong, it shows a growing appetite and desire by smaller businesses to join the SE movement.

Overall, Hong Kong’s social enterprises can be characterized as “small scale” operations and their business models and operations have become heterogenous. One research reported that around 70% of the SEs in Hong Kong was small scale, employing less than 10 full-time staff (British Council Hong Kong 2020). Hong Kong’s social enterprises operations have also become more diversified. Their products ranged from mainly catering, food manufacturing and grocery retail in the initial stage to include technology-enabled services and consultancy. In terms of social issues addressed, the social enterprises covered primarily people with disabilities and experiencing poverty extending to environmental protection and responsible financing. A good proxy for this diversification is the SEBC directory, which has shown a growing number of categories of the social enterprises.

Given the lack of clarity of what classifies as “social enterprise,” an organization called Hong Kong General Chamber of Social Enterprise (HKGCSE) was set up in 2009 and then offered the SE Endorsement Mark, known as SEE Mark in 2014. Organizations can apply for such endorsement––where their applications will be vetted according to certain standards in the endorsement. Up to the middle of 2020, more than 200 social enterprises have received such endorsement (HKGCSE SEE Mark, Footnote 6 2020). As the appetite for social enterprises have been quite high in the past few years, it is not surprising that there are many social enterprises that are not documented officially thus are not included in the tally. Therefore, the actual number of social enterprises could be higher than that was reported. Moreover, there is also growing number of small businesses that claim to be “social enterprises”––which muddled up the idea of what constitutes a social enterprise.

As one local academic commented in a public lecture in 2022––despite the growth of social enterprises and the massive interest in SE, Hong Kong’s social enterprises still experienced a “tomato problem.” This was an analogy of the debate of whether a tomato is a fruit or vegetable (National Geographic 2015); which rings a bell on the perennial question or confusion of whether social enterprise is a business or charity. Interestingly, despite its nearly 15 years of history, social enterprises in Hong Kong remain not well understood by the public and there has been a strong perception, or association for a lack of a better term, that social enterprise is a kind of “non-profit organization.” This also shows that the “stickiness” of institutional origin of social enterprises in Hong Kong––that started off and were championed by NPOs––that shaped public perception of what social enterprise really is.

2 Lessons Learned from Hong Kong’s Social Enterprise Movement

Despite the very encouraging development of social enterprise movement in Hong Kong over the past two decades, there remain several pressing challenges. According to a report The State of Social Enterprise in Hong Kong sponsored by British Council Hong Kong (2020), the top four challenges faced by the social enterprises include: (1) customer acquisition and market development, (2) access to financial support, (3) product/service development and innovation, and (4) talent acquisition and retention. This suggests that––as hybrid organizations that integrates social and commercial value––social enterprises in Hong Kong faced greater problems with the business aspects but not with social aspects, or what Santos (2012) called value capture than value creation. This is not surprising because social enterprises must compete in the “open market” against much more competitive small and medium business players. This also suggests that social enterprise as a multi-objective organization (Chandra et al. 2022) may not be able to optimize on all objectives but must make trade-offs to survive financially.

In the following, we sketch some lessons––encouraging and discouraging ones––that may offer useful points for the future direction of the practice of social entrepreneurship and for the development of the SE sector.

2.1 Encouraging Lessons

2.1.1 Socially Minded Business Entrepreneurs’ Participation

Dozens of socially minded businesspeople (e.g., Ka Kui Tse, Chi Hing Kee, Rebecca Choy Yung, Ada Wong, Patrick Cheung, Francis Ngai, Ricky Yu, Doris Leung, David Yeung, etc.) participated in promoting the SE movement. Rather than being constrained by the subvention practices and attitudes––a common mindset by many SEs founded by NPOs and charitable groups––these businessmen and women brought with them the entrepreneurial attitude and business skills to effectively fuel the development of the SE sector. For example, Hong Kong Social Entrepreneurship Forum (HKSEF) was formed in 2008 to promote the civic movement and subsequently become the host of the annual Social Enterprise Summit. Some of these individuals invested in and founded some of the most recognizable SEs in Hong Kong (e.g., Dialogue in the Dark, The Good Lab). Others were hired as top executives to run and successfully scale up certain SEs (e.g., Mental Care Connect). Other remarkable social enterprises set up by former businesspeople include Light Be and Diamond Cab. They adopt creative and innovative entrepreneurial mindset and practices to run their business and at the same time creating social impact, therefore setting a role-model for other SE founders and individuals aiming to launch and operate their social start-ups.

2.1.2 Capacity Builders Contributing to Professional Development

The SE sector in its infant stage needed strong actors for capacity building. Several training and consultancy firms were setup in early 2010s to boost the professional development of the partitioners. The pioneers were Education for Good, Fullness Social Enterprises Society, The Good Lab, and Social Ventures Hong Kong. They are involved in providing public education of the concepts of not only social enterprise and social innovation but also Certified B Corporation (to be discussed in the next section) and related concepts including Creating Shared Value. A more recent one includes the Social Impact Assessment capacity building training for NPOs and SE practitioners, offered by Fullness SE Group with funding from Hong Kong Jockey Club.

Tertiary education institutions also played a key role, with several institutions starting to introduce academic programs and courses on social innovation and entrepreneurship as early as 2013. The Hong Kong Polytechnic University (PolyU) launched the Centre for Social Policy and Social Entrepreneurship to conduct systematic and policy-relevant research to add the depth and rigor of the professionalism and knowledge. The Social Enterprise Endorsement (SEE) Mark developed by Hong Kong General Chamber of Social Enterprise has brought in the concept of standards and quality assurance that helps elevate the public awareness on and confidence of the SE sector.

2.1.3 Private Intermediaries and Platforms Enabling Agile and Flexible Support

In addition to the sizable government-sponsored platforms (e.g., Social Enterprise Business Centre by HKCSS), the emergence of privately funded and operated intermediaries has shown the importance of agile and flexible support to facilitate connection between social enterprises to investors or corporations.

2.2 Discouraging Lessons

2.2.1 Grants (and Related Key Performance Indicators KPIs as the Primary Support and Monitoring)

Evidence showed that if the SEs received the grants as the primary (or only) aid without other necessary entrepreneurial support (e.g., business coaching and mentoring, building business capabilities) to develop financial sustainability, the chances for their sustainable development are not promising. This is because a subvention approach may help the SE to launch and survive for a short period of time only––usually from 6 months up to two years––but does not stimulate entrepreneurial mindset to face the challenges in the real business world where the SEs operate and compete in.

2.2.2 Insufficient Business Acumen

A substantial number of SEs have too much skewed their focus to achieving social objectives––thus being “too social”––and have not paid sufficient efforts to acquire the necessary business knowledge and skills to ensure their financial sustainability. Two major gaps are highlighted here: (1) paying disproportionate attention to the solutions/products/services offered to the customers or beneficiaries instead of developing a “business model” covering channels, revenue, and costs, etc.; (2) lacking the financial disciplines of business development, invoicing, cash-flow control, etc.

2.2.3 Bold Starter But Conservative Growth Driver

Most SE founders have demonstrated considerable bravery in the start-up stage, either risking on their own money or looking for investment or loans from external parties (e.g., banks, seed investors). However, quite a sizeable proportion of SEs do not aim high to expand their business and are very much shy of identifying business levers nor seeking additional funds to enable business growth. Another reason is that these SEs are overly passionate for service delivery rather than business development or lack the business acumen for doing so. This explains why these SEs are not able to scale up their business and thus their positive impact to the society.

2.2.4 Lacking a Promising Career Path

Most employees working in SEs are motivated to join and stay in the sector driven by social passion. However, they are usually not very well-paid, not provided good employment conditions and with promising career development prospects since most SEs are small and have limited resources (i.e., fewer than ten full-time employees) and financially not very capable. This partly explains why staff acquisition and retention is one of the top challenges faced in Hong Kong’s SEs.

3 Ways Forward: From Social Enterprises to Purpose-Driven Companies

The end goal of promoting social enterprises in any society is to harness all the resources (e.g., experience, expertise, skills, networks, mindset, etc.) and influence resourceful actors such as business corporations––essentially more competitive and adaptive––to take part in addressing social problems and make the world a better place.

Although the SE movement in Hong Kong has seen encouraging results since early 2000s, several factors are noteworthy for further development to continue improving the development of the SE sector and promote the movement of using business as a force for good to the society and the world at large. We describe these factors below:

3.1 Alternative Funding Sources

Most funding to SEs is targeted at their start-up stage with the intention to encourage individuals or organizations to setup more social enterprises, i.e., to broaden the sector by increasing the number of SEs. From the perspective of scaling up the aggregate positive impact to the society, we believe it is important to have more varieties of funding options from different funders or funding platforms to fit with business needs, particularly enhancing their commercial capabilities to expand their business among established social enterprises with promising growth potential. For example, the funding and review mechanisms should be designed to enhance entrepreneurship (e.g., loans and capital rather than grants and subsidies, in-phases rather than one-time lump-sum, driven by the business model’s potential rather than the no. of beneficiaries, etc.).

3.2 Capacity Building

In line with the theme of nurturing social entrepreneurship and supporting promising SEs to scale up their business, more sophisticated and targeted non-financial support such as commercial and financial skills, business coaching and mentoring, etc. are equally, if not more, important.

3.3 Deeper Cross-Sectoral Collaboration

To provide more promising career prospects to attract passionate and social-minded young people to join and stay in the SE sector, cross-sector collaboration––involving tertiary education institutions, business corporates, the government, social enterprises, etc.––is needed to develop professional development and career advancement paths.

3.4 Inclusive Purpose-Driven Business

No matter how fast the SE sector is developing and growing, the number of SEs still accounts for a tiny portion––well under 0.1%––of the business establishments in Hong Kong according to the Trade & Industry Department company registration statistics (https://www.tid.gov.hk/english). On the other hand, increasingly more corporations want to become more purpose-driven and create positive impact to multiple stakeholders (e.g., staff, customers, community, the environment) in addition to making profit to the shareholders. Several “doing good” frameworks have been proposed and implemented for some years (e.g., corporate social responsibility, caring company awards, creating shared value, etc.). One major gap is to have a framework which is inclusive––one that is relevant to businesses of different sizes, stages of development and industries––transparent, objective, and quantifiable to guide mainstream for-profit corporates to become (more) purpose-driven businesses. Some business leaders demand for a model that could organically integrate the purpose-driven mission into the company’s core business strategy to maximize the profit-purpose bottom-line. This leads us to the discussion on Certified B Corporation (B Corp) and whether its framework could be used to drive more inclusive purpose-driven companies.

4 The Emergence of B Corp in Hong Kong

Certified B Corporation, or in short B Corp, movement––a voluntary certification for companies that wish to consider people, planet and profit––first began in Hong Kong when Education for Good, the first B Corp was certified in 2016 (Honeyman and Jana 2019). This was followed by B Market Builder Hong Kong which was formed in 2017––a joint initiative of Hong Kong Social Entrepreneurship Forum and the B Lab Global. Since then, various activities (e.g., publishing books and papers, training courses, seminars, and events, etc.) have been organized to promote the B Corp movement to different segments of the society including corporations, industry associations, academia and students, young workers, customers, and the public, etc.

Established legally as an NPO in 2020, the B Lab Hong Kong and Macau was formed to officially drive the B Corp movement in Hong Kong and Macau. As of the end of 2021, there were 17 certified B Corps and 4 pending B Corps in Hong Kong. The B Corp movement is still in its very early stage of development. B Lab Hong Kong and Macau have dual goals when promoting the B Corp movement. First, to boost the awareness of B Corps and assist the certification process for aspiring B Corps––those that are about to kick-start the certification journey. Second, to build communities in the business ecosystem and use B Corp and B Impact Assessment (BIA)––a tool to quantify a company’s impact across five stakeholders: employees, customers, communities, environment, and governance––as the frameworks to inspire more mainstream corporates to become purpose-driven businesses.

B Lab (HK & Macau) sees this as the start of a broader dialogue to promote a wider adoption of the B Assessment by interested companies. It will engage with more stakeholders, organize events and training sessions to build greater capacity.

5 B Corp: A Movement to Promote Purpose-Driven Businesses to Achieve “Shared Prosperity” in Hong Kong

5.1 Shared Prosperity for All

The term “common prosperity” (共同富裕) has triggered heated discussions in Hong Kong and the Mainland when the China declared in 2021 that it will pursue “common prosperity,” pressing businesses and entrepreneurs to give back to the country and helping to narrow the huge wealth gap through the “third distribution” system (South China Morning Post 2021).

There are no quick fixes for China’s, or indeed for any country’s unequal income-distribution problem. Addressing it will require cultural and systemic changes. Our notion of shared prosperity combines both rising prosperity and equity. Prosperity is far more than wealth; it is when all people have the opportunity and freedom to thrive. The economy is benefitting a small number of people around the world, but few are sharing the resulting prosperity. We are facing escalated global climate crisis and poverty problems which are further aggravated by the pandemic. According to the World Bank, “Our focus on shared prosperity reflects the fact that many countries are seeking rapid and sustained increases in living standards for all of their citizens, not just the privileged few.” (1) How to achieve this? What is missing? What more could be done? (The World Bank 2013).

There are different pathways to shared prosperity. Although the government plays a critical role by developing a favorable eco-system and complementary policies, the private sector is the main growth engine for wealth, job creation and talent development. To give a fair representation of the views of the business community, in December 2021 and January 2022, we organized two focus groups with 35 leaders from various business, legal, financial, and social enterprise sectors. We sought to understand their views on “shared prosperity,” instead of “common prosperity,” and explore how this will provide a path to prosperity for all stakeholders of the society.

5.2 “Shared Prosperity”: An Imperative in the Post-COVID Era

It has been three years since the onset of the COVID-19 pandemic. The global economy is expected to rebound as major economies such as the USA and China will register strong growth. Even within these economic giants, income is unevenly distributed. Hong Kong is not emerging out of poverty either although it is a well-known financial centre. Its Gini coefficient rose to a high point of 0.54 in 2016 (HKCSS 2021). The Hong Kong Poverty Situation Report 2020 highlighted that 23.6% of the city’s 7.5 million population were living in poverty, the highest since 2009 (The Government of Hong Kong Special Administration Region 2021). We can no longer hide from the pandemic, ageing, inequality, social exclusion, or the climate emergency that impact everyone. These realities have shown us the necessity and urgency of promoting shared prosperity. A few participants, though appreciate this notion, still maintain that this is a myth which the private sector does not fully embrace.

Almost all the participants of the focus groups agreed that over the past century, we overtly expand production, reduce costs by all possible means, improve technology, stimulate consumerism, producing far too many material goods than were needed. Now we need to face equity or the problem of “distribution efficiency.” We must use various methods to improve distribution efficiency, consider fairness, and prevent polarization.

Shared prosperity is not egalitarianism or robbing the rich to feed the poor. We should avoid falling into the trap of welfarism and populism. The fundamental aim is to encourage wealth creation through hard work, innovation, and investment. Many people are trapped in multidimensional poverty, that is, poverty in housing, health and education and other areas where disadvantaged people are relatively deprived. There are many challenges in developing the capacity of the disadvantaged groups to escape poverty and consolidate poverty reduction results. Almost all participants believe that society should strive to achieve equality of opportunity.

Income and property measured by money are of course important, but the common people also need to enjoy equitable and quality services such as healthcare, elderly care, housing, a safe and harmonious social environment, and a healthy natural ecology. In an ageing society, helping the elderly age in place and healthily will become an important demand from the people.

Shared prosperity is not only about income and material rewards, but also time and ability. People need access to equitable education and employment. People are also in great pursuit of social fairness, transparency as well as spiritual prosperity. Otherwise, no matter how much money they have, they will not be happy.

5.3 Business Community’s Roles in Driving “Shared Prosperity”

Most participants agree that the business community plays an important and positive role as the government and non-profits alone could not satisfy the demands for all of the above. Businesses are dynamic and excel in creating resources. Business leaders often have the skills and the ability to assemble the resources needed to take on large, complex problems with multiple stakeholders. However, the pandemic and the rapidly changing environment have taken a toll on small and medium-sized companies. Such companies have to strike a balance between survival and looking after the well-being of their stakeholders.

Furthermore, institutions and mechanisms for engagement of the private sector are inadequate. In many countries, business leaders have quietly but persistently assembled civic alliances that pursue growth and shared prosperity. After all, business is deeply affected by the erosion of many of the common people’s basic requirements, and a system that underpins innovation. How to promote enterprises to attach equal emphasis on social and economic benefits, innovate the practical means of shared prosperity, and create greater social value, are the missions of our time.

Some hold that mere market relocation of wealth by the private sector is difficult if not impossible. Society needs government policy to drive the post-COVID era. A few others do not believe in organic change and suggest that legal regulation is needed to push forward before a change of culture and attitude may take place.

Most participants are empowered by the ideal that business success and social progress should be closely connected. It is only by integrating sustainability and social impact into our business that we can truly create greater value for the present and also contribute to a brighter future for all.

6 The Emerging Popularity of the ESG Framework in the Business Sector

The ESG (environmental, social, and governance) framework and requirements provide the private sector with a new vision for profit and social change. Most participants agree that ESG programs are conducive to creating short- and long-term values. Although many corporations are uncertain of the ways to achieve ESG requirements, an increasing number of corporations have acted with spontaneity to build a more inclusive and sustainable economy. In their quest for profits, companies are also driving innovations that improve health outcomes, make progress on climate change, provide better access to education, and create new economic opportunities for those in poverty. Participants point out that talent pool development, including training on environmental and social impact measurements, mindset and skillset changes should be instilled in every profession.

Although half of the participants are not familiar with B Corps, they agree that business needs comprehensive, credible and comparable standards to support both internal and external changes. There are strong requests to build a performance indicator or standard so that corporations, especially medium and small enterprises, need not look further. The B Impact Assessment (BIA) represents rigorous standards of social and environmental performance, accountability and transparency that suit the needs of corporations.

The rise of the B Corp movement in Hong Kong signifies that in today’s environment, business can, and must, act to change the world. We, the writers of this article, explained to the participants how B Corps work toward the prosperity of all, especially on reduced inequality, a healthier environment, stronger communities, and the creation of more high-quality jobs with dignity and purpose. To date, there are 17 B Corps in Hong Kong with a few under application. There is much room for promoting B Corps to the local community.

7 Impact Investing to Regain Hong Kong’s Growth Momentum

Investment is not a demand. The demands of different market segments are the real demand, and investment is a necessary cost to meet this demand. With such a concept, it is not difficult to find out how economic development can be sustainable. The real needs of the common people, from food, clothing, housing, and transportation to housing for the elderly are what businesses should address. What scale and growth rhythm are needed? How to scientifically calculate and set the overall economic goals, and balance the all-round development of people’s lives are the core issues?

Sustainable financial initiative and ESG development and regulatory is rapidly developing in Hong Kong and internationally, adding pressure for mainstream corporations to comply with ESG requirements. Participants from the financial sector point out that, from an investment perspective, “sustainability,” “social investment,” and definition for “creating impact” is essential. Institutional investors and fund managers alike should sign up for responsibility to make ESG investment decisions. However, their main concern is that ESG education is highly insufficient. Standard and data are needed. All these should be built up step by step. Again, the B Impact Assessment (BIA) will provide a well-tested benchmark to satisfy such loopholes (Marquis 2020).

When it comes to ROI, most of us may think of Return on Investment. But there is a new ROI, Return on Inclusion, being proposed in recent years (https://www.tahra.org/roi-summit_id202). According to the Global Economics of Disability 2020, People with Disability (PWD) and their friends and families represent 73% of consumers market and control over US$13 trillion disposable income worldwide. In Hong Kong, PWD is an underserved business segment which represents about 8.1% of the total population or 600,000 people. Together with their families and friends, there are 1.2 million such consumers according to the research by a local social enterprise, iEnterprise. The business sector is encouraged to broaden the investment spectrum to the new ROI and meet their ESG goals.

Some participants see B Corps as models that would integrate high ESG performance standards for the business sector. In fact, B Corps and the comprehensive nature of BIA requires a company to go through a deep and thorough review of its business and operations, an exercise that corporations will increasingly need to go through to meet ESG reporting requirements imposed by the Hong Kong Stock Exchange or investors’ demands. This may pose B Corps with market positioning value. Eventually, we need to bridge the gap between companies that really believe in doing “good” and businesses that do it for “compliance.”

We, indeed, need a critical mass to drive social change. Yet we should go one step further, after raising people’s awareness, we need to institutionalize those ideas and try to make changes at a systemic level. And to drive such change, we need collective efforts, real leadership, and a sustained commitment over a long period of time. However, when the right ingredients are in place, progress is possible.

8 Epilogue: B Corp As a Business-Cum-Social Movement to Drive Shared Prosperity

Our future requires both growth and shared prosperity which is underpinned by an inclusive society, an open economy, and people empowerment. The issues we tackle are complex. From ageing to ESG—there is no way for a single entity to achieve large-scale change in these areas. It will take many individuals and organizations working together to bring lasting change. B Corps are catalysts for positive business and social change. For this to happen, we need a business-cum-social movement to achieve these goals. A fundamental shift is much needed and many ingredients for the solutions are here. We hope that together, we can make shared prosperity a reality.

Having experienced political unrest, societal rifts, the outbreak of coronavirus and economic recession, everyone in Hong Kong has been trying very hard to find a new path to their dreams. Aspiring minds in the business communities should try to bring about innovation in businesses, embrace the idea of “benefit for all stakeholders” and truly pursue business sustainability.