Page 240 - Social Enterprise A New Business Paradigm for Thailand

Chapter 8

Effectiveness and Sustainability of

Social Enterprises in Thailand

Social enterprises are business organizations that purchase, produce, and sell goods and
services with objectives that go beyond commercial survival, namely, to reinvest profits back
into society. This may include sourcing products from local communities, employing local
residents, developing grassroots economies, or empowering specific groups such as vulnerable
or disadvantaged populations. Social enterprises have become a growing trend in the wake of

heightened societal awareness following the era of corporate social responsibility (CSR). During
this shift, businesses began to move away from a sole focus on profit and brand image, toward
practices that prioritize social accountability and value creation. This transformation has
fostered new business models that align with prevailing social trends, encouraging companies
to contribute positively to communities and stakeholders, thereby enabling business growth
that is inclusive, resilient, and sustainable. Social enterprises have emerged as a response to
the limitations of government policies in effectively addressing poverty, income inequality, and
a range of social and environmental challenges. These limitations are often the result of
inefficient operations, multilayered bureaucratic systems, and conservative procedures that

require thorough verification before action can be taken. Consequently, social and
environmental problems have grown increasingly complex (Yunus, Moingeon, & Lehmann-
Ortega, 2009, 2010). At the same time, traditional capitalist enterprises have contributed to
long-term systemic risks for society and the environment, including widening income disparities,
financial inequality, and escalating poverty (Yunus & Weber, 2017).

However, social enterprises often face significant challenges in securing core funding, obtaining
grants, generating income, earning profits from their products and services, and delivering
social value in ways that set them apart from others (Balan-Vnuk & Balan, 2015; Cho, Kim, &

Oh, 2022). They also struggle to maintain a balance between financial returns and their social
mission, often encountering dilemmas that force them to choose between the two (Cheah,
Yeoh, & Chandra, 2023). In addition, social enterprises are typically small or medium-sized
businesses that are more susceptible to shifts in the business environment than larger firms.
They often face resource and funding shortages, particularly during the early stages of
operation; lack business models that effectively coordinate organizational components; possess
limited strategic capabilities; receive little support from socially conscious consumers; and

operate in the absence of policies or legal frameworks that promote their growth (Chen & Tang,
2019; Nascimento, da Costa Júnior, Salaza, & Chim-Miki, 2021). A closer examination reveals
weaknesses in product development that hinder competitive advantage, as well as limitations
in market expansion. As a result, social enterprises frequently struggle with basic survival, failing

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