Great strides for new Great Walk
Unless do-good social enterprise businesses have transparency rules, the risk of ‘‘impact-washing’’ is high, writes Rob Stock.
When you pay your $12.95 for Eat My Lunch, it’s nice to know a needy child will get a school lunch.
But you don’t know how much of the price you paid for your luxury lunch goes to provide that lunch, and Eat My Lunch isn’t saying.
Social enterprise is on the rise in New Zealand, with businesses selling their wares to consumers with a promise that each purchase is doing good.
But New Zealand is increasingly looking out of step when it comes to the transparency required of social enterprise overseas.
Social enterprise, and especially the ‘‘buy one, give one’’ social enterprise, or BOGO business model, where consumers pay over the odds for a product in the knowledge that a similar product will be gifted to a needy person, are business buzz-words of the moment.
But there’s no clear definition of how much good a business needs to do before the act of calling itself a social enterprise verges on being a marketing wheeze trading on the desire of consumers to be seen to be doing good.
For some in New Zealand, the concept of ‘‘trust us, we are a social enterprise’’ should no longer be tolerated.
WHAT SHOULD BE KNOWN
Marjo Lips-Wiersma, professor of Ethics and Sustainability Leadership at Auckland University of Technology, believes any business calling itself a social enterprise should tell consumers some key information to justify their claim.
■ What percentage of the income earned is spent on the actual beneficiaries. Like charities, social enterprise should have to publish accounts, reveal salaries (especially of the chief executive) and other expenditure. They needed to be available to ensure volunteer labour and donations did not turn into private profit, LipsWiersma says.
■ If the social enterprise makes claims such as organic, fair trade, or made in New Zealand, they must prove it. ‘‘One of New Zealand’s oldest social enterprises, Trade Aid, can be trusted because it is accredited by the World Fair Trade Association,’’ she says.
■ Their environmental sustainability. ‘‘The public would not expect a social enterprise to do good by doing harm somewhere else,’’ she says.
■ How they treat and pay both local and overseas workers.
COST OF LUNCH
Eat My Lunch, the most famous of the Kiwi BOGO businesses, does not meet Lips-Wiersma’s desired levels of transparent.
People buying one of Eat My Lunch’s $12.95 to $18.95 lunches is not told how much of the price goes towards providing the lunch given to the needy child under its BOGO model.
Only if a consumer is armed with that model can they decide whether they wouldn’t be better just buying a more modestly priced lunch, and gifting the savings to charity.
Julie Chapman, from the KidsCan lunches into schools charity, says: ‘‘At a minimum, people who support social enterprise should know how much of their purchase is going to the cause.’’
Without hard facts, consumers’ perceptions of the good being done are likely to be led by advertising, and statements on a social enterprise’s web page.
Eat My Lunch, for example, says children get lunches that look and taste like they’re home made, and has appetising pictures which show the kids’ lunch alongside the luxury lunches sold to consumers.
But BOGO social enterprises often have a product mismatch.
The paying consumer gets premium quality. The recipient of the freebie gets something less.
The average cost of a ‘‘basic’’ week’s food for a 10-year-old is $52, according to the Department of Human Nutrition, University of Otago, food costs survey.
That’s less than the $64.75 cost of ordering a Classic Eat My Lunch lunch for five days.
There’s a tab on Eat My Lunch’s website which a consumer can use to pay $10 to buy two children’s lunches to be delivered to needy children in schools.
But what do those lunches cost to make and deliver, or does the $10 include a profit margin for Eat My Lunch?
Eat My Lunch founder Lisa King did not respond to requests for comment, including the cost of the children’s lunches.
Eat My Lunch says more than