Beyond Profit: How Social Entrepreneurship Is Developing in Russia

Social Entrepreneurship is a relatively new form of doing business in Russia (formally established in 2019), though it has existed in practice since the mid-2000s. Today, this new form—socially oriented business—is being discussed with increasing frequency, which is especially important during a challenging period for the country's economy. It's crucial to understand that social entrepreneurship is not charity, not altruism, but a modern institution for solving society's problems.

In global practice, starting from the 1970s and 1980s, successful precedents of "market-based assistance" to vulnerable population groups have been established. Social entrepreneurship attempts to address one of the biggest conceptual vulnerabilities of market economies—the question of who will support the most vulnerable groups in society. Traditional charitable foundations don't quite fit the concept, because in a sense they create "grant dependency" among nonprofits. In other words, one of an organization's operational tasks becomes servicing and obtaining grants, rather than focusing solely on direct and effective activities. Therefore, various forms of business that combine profit orientation with a social function, rather than pursuing pure profit maximization, become examples of social entrepreneurship: money is earned to change lives for the better.

As noted by the Director General of the Agency for Strategic Initiatives :