Leadership can be described as a unique ability / influence which an individual may possess, which in turn can be utilised to win the support and blessing of many followers towards accomplishing an objective or a goal in a micro or macro environment. "Leadership has been written as the process of social influence in which one person can enlist the aid and support of others in the accomplishment of a common task".
Further, there are many examples that we could take on leadership if we turn back time. E.g. Adolf Hitler, Hitler from his school days was looked upon an admired by many of his colleagues of the leadership qualities he possessed "Hitler did extremely well at primary school and it appeared he had a bright academic future in front of him. He was also popular with other pupils and was much admired for his leadership qualities". However, though he was looked upon by many as a leader it is to date is debatable whether it was responsible leadership that he possessed right along.
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Responsible leadership can be described as the process where a leader makes decisions considering economical, social and environmental factors. E.g. triple bottom-line concept. In business environment most people are very much concern of making profits the ethical way which is described in triple bottom-line where they critically discuss factors pertaining to people, planet and profit. "Sustainable Corporation is one that creates profit for its shareholders while protecting the environment and improving the lives of those with whom it interacts".
Commercial entrepreneurship can be described as a process that involves business activities with the core objective being profit maximization while paying due attention on social and environmental obligation though responsible leadership. E.g. Virgin Atlantic airlines. With its responsible leadership they have committed to donate $ 3bn which was the profits of couple of years on a project of making cleaner fuel that is more environmental friendly which can be used for air-line transportation.
Social entrepreneurship is a concept which is being practiced by organizations whose core objective is to serve the social and environmental needs of people and be in operation as a non-profit organization. "An enterprising person who applies entrepreneurial principles and skills to the resolution of social or community problems" (Schaper & Volery 2004) e.g. "International Congress on AIDS in the Asia and the Pacific" is a non profit organization whose core objective is to enhance the masses knowledge about HIV, prevention of HIV and life with HIV. "The ICCAP meeting is an event which deals with achieving meaningful exchanges of expertise, experiences, advances, lessons learnt, challenges faced and successes achieved in HIV/AIDS programmes, empower and strengthen political, community and business leadership, adopting a consultative, collaborative and participatory approach, form meaningful and sustainable partnerships between stakeholders at all levels, showcase achievements and successes and share best practices, promote equal access to prevention, support, treatment and care for all people".
In commercial entrepreneurship as well as in social entrepreneurship viability is a key aspect that will be considered by its responsible leadership. Further, core aspect of viability is to execute business operation within the right environment which helps in delivering desired results to its stakeholders. Whereas, in social entrepreneurship looks at viability as an available opportunity to carry-out its key objective of serving the people and helping uplift their livelihood. The attention towards viability is high in commercial compared to social since liability in business activities are much greater compared to social entrepreneurship. Moreover, business organizations are equipped with short-term and long-term plans to achieve vision, where as social entrepreneurship is more short term oriented.
In accountability, commercial entrepreneurship has the responsibility towards its stakeholders such as shareholders, government, employees etc. Whereas, accountability in social entrepreneurship highlights it's lenders and beneficiaries. In business environment due attention is given in making profits in order to satisfy its shareholders. Therefore, accountability towards its business objectives & goals are greater than social entrepreneurship.
In a nutshell ethical approach in commercial entrepreneurship looks at how to maximise profit and return on investment in business while minimizing / avoiding any negative effects on society. E.g. today's market for eco-friendly & fair traded apparel has risen drastically compared to past years. "In 2009 M&S was the UK's largest retailer of Fairtrade certified cotton products with a market share of over 30%. In 2009/10 we sold 7.9 million Fairtrade certified cotton garments and Home products (2006/07: 0.5 million). We estimate that our 2009/10 Fairtrade certified cotton usage was equivalent to around 2,100 tonnes or 2.5%â€ of all the cotton we used (2006/07: less than 1%)". In contrary responsible leadership in social entrepreneurship describes ethics as its responsibility towards their product or service that will be rendered to the society to achieve their objective while sustaining social values and striving to achieve desired goals for the betterment of the society.
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Decision making by responsible leadership in commercial entrepreneurship focuses a lot on the macro picture like obligation towards society, environment and its employees etc before coming in to any conclusion. Moreover, decision making is a key aspect of the business that influences towards its success. However, social entrepreneurship emphasise decision making to be based on the core objective of its funder against a community / area or country that has the exact needs for the same. Furthermore, competitiveness in commercial entrepreneurship is much greater than social entrepreneurship. Therefore, decision making plays a major role in businesses to win business objectives more effectively and efficiently compared to social organizations. "Decision-making increasingly happens at all levels of a business. The Board of Directors may make the grand strategic decisions about investment and direction of future growth, and managers may make the more tactical decisions about how their own department may contribute most effectively to the overall business objectives. But quite ordinary employees are increasingly expected to make decisions about the conduct of their own tasks, responses to customers and improvements to business practice. This needs careful recruitment and selection, good training, and enlightened management".
Sustainability in responsible leadership refer to meeting today's need of the organization while not compromising on the adverse effects it could hold not only on today's generation but for the future as well. "The concept of sustainability is a broad construct. It overlaps with the corporate social responsibility (CSR) domain, with a focus on advancing the standard of living while also preserving natural and human resources" (Reilly 2010, pp.04). In other words, it is a business that "meets the needs of the present world without compromising the ability of the future generations to meet their own needs".
In commercial entrepreneurship transparency plays a major role in the entire supply chain in order to make win-win situation across all stakeholders who are engaging in business activities. Further, unlike good old days, business information and its related strategies are open and publish in different channels. "Transparency in business is of utmost importance to success. Not only does it help customers see through to your character as a person, but it gives your business the reputation of being honest and trustworthy"
However, transparency in social entrepreneurship illustrates the way that NGOs need to act in accomplishing projects in different cultures, countries, ethnicities etc. In doing so, transparency act as a key role in social entrepreneurship compared to commercial entrepreneurship which results in getting funds from its funders and also support from all relevant bodies in order to execute further activities.
In commercial entrepreneurship observing community obligations is a key aspect which comes under sustainability of responsible leadership that illustrates the responsibility given towards the society and its respective parties in doing business activities. For an example company might be using chemicals and dye stuff to carryout day to day operation activities, but prior to releasing it to the society, organization has to ensure that the water is treated within the plant to a level that is stipulated by the environmental authorities. In social entrepreneurship concept, NGOs have to do their projects as per the rules and regulation imposed by the government or respective bodies. Further, they must be mindful of the existing culture of the society and they must respect the same.
Integrity in both commercial & social entrepreneurship requires responsible leadership to act as per the value which the companies govern by. "While we do not expect business leaders to be saints, we certainly expect them to adhere to certain moral standards and to transmit these in to acts of responsible leadership. It is in this sense that badaracco and ellsworth claim that integrity lies at the very heart of understanding what leadership is".
Fair treatment can be described as equal treatment across all members in a society or an organization irrespective the ethnicity, culture, race etc. In order to get much effective and efficient work from employees, management / administration must treat all employees equally. "The administration has the responsibility of insuring fair and equitable treatment and of eliminating offensive behaviour from the workplace".
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Managing negative impacts of the work processes can be aligned to certain skill levels that are required in performing a task of an organization. However, the employees managing that task could be susceptible to certain risk factors that need extra attention. In contrary in social entrepreneurship negative impacts of the work process can be related to issues where the individuals are not allowed to continue their social services in an appropriate manner due to many obstacles from different bodies.
In commercial entrepreneurship responsible leadership demonstrates humanity in ways of supporting their associate's families in fulfilling their basic needs such as, food, shelter, education for children, healthcare so on. In social entrepreneurship humanity is perceived as the core objective. Therefore, the weightage towards demonstrating humanity is higher in social entrepreneurship compared to commercial entrepreneurship since its core objective is to strengthen people living. "Now, more than ever, we continue to be hopeful that together we will influence change in our lives and in our communities gradually building a network for change. We are an alliance of individuals, groups, and organizations from all walks of life and all aspects of the human agenda, focused on improving the sustainability, the capacity to be happy, the social equity and the serenity of our human family".
As I described above responsible leadership plays vital role in commercial entrepreneurship as we all as in social entrepreneurship. Further, as per the literature review that I have incorporated above describes the trend towards responsible leadership in commercial environment has been changed compared to past years in more positive manner though the primary objective of a business is to make profit. Moreover, the attention & commitment towards responsible leadership is higher in social entrepreneurship since the core objective of these organizations to serve people who require aid from others in order to strengthen their lives.
Reilly, A., 2010, 'Responsible Leadership and Corporate Sustainability' Paper presented at the 3th Annual Meeting of Colleagues in Jesuit Business Education (CJBE), Marquette University, pp. 04.
Schaper, M & Volery, T., 2004, Entrepreneurship and Small Business, John Wiley & Sons, Australia.
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