Too important to make lots of money from

I’ve had lots of e-mails, tweets and a few calls from journalists asking for a bit more explanation on something I said on The World Today on BBC Radio 4 on Thursday night.

Charlotte Ashton from Radio 4, as part of her series on British social enterprises, asked whether it should be acceptable for social businesses like ours to make large amounts of money and make our Directors very rich on the back of successful social and environmental work.

Essentially, if we’re saving the government substantial amounts of money or enabling new economic growth by reducing ill-health or increasing social capital, for example, should we be due a gold-plated slice of that value?

I said that I hoped that would never be the case and that some things we were too important to make lots of money from.

First, this wasn’t a moral statement or part of some sort of latent anti-capitalism. I don’t object to people making lots of money. I do think the vast gap that has emerged between the top and the bottom earners in countries like the UK is extremely damaging and am a huge advocate of Richard Wilkinson and Kate Pickett’s work on these effects. But I don’t think that everyone should be living on a kolkhoz or anything like that.

Moreover, it’s not a sweeping statement about the relationship between different types of value and reward in a post Thatcher-Reagan world. Something precious was misunderstood and eroded during that time and perceptions of social value shifted in a strange direction, but much more intelligent people have said many more intelligent things about these broader changes than me. So I’ll leave that to them.

Really, it just relates to the small world of our work at We Are What We Do.

We spend a lot of time with our partners in communities looking at the social issues that affect them. And we also spend time round tables with more partners analysing the behaviours that shape these issues and working on ideas that might make a positive contribution.

As we’re working in these communities and round these tables, being an individual, a team and an organisation that is not there to get rich is absolutely vital. That motivation would drastically undermine our ability to collaborate and co-operate with all those partners on profound social issues.

We have experience of being round tables with some parties there to deliver maximum value for shareholders and others there to deliver maximum social benefits. Whether or not there is a market-based, intellectual argument that these motivations can align, in practice it does not work. It breeds mistrust, imbalance and, vitally, disengagement from a common purpose – to be replaced by a focus on distinct personal or organizational purposes, from all sides.

The motivation of substantial wealth generation has to be removed from these tables for genuine progress to be made when it comes to important social issues.

Not coincidentally, big social issues are also too important for people working on them to be paid too little. Not only does it often mean that you can't have the best people round that table, because the lifestyle sacrifice is too big, but it also means that money becomes an issue.

For true collaboration around social issues to take place, the influence of money has to be neutralized.

For example, when we bring together groups of good people to work on particular issues – at, say, a day of planning sessions – some we invite well may be happy to be there for free, while others working on the ground in communities may have a day rate of £150 and others may be highly paid consultants on day rates of £2,000 or more.

The only effective way of bringing out the best of this group is to remove any lingering doubts about who is being paid more than others and pay everyone the same – either a standard, reasonable rate or a set of rates with a relatively small ratio between top and bottom.

This applies just as readily to teams of premiership footballers or divisions of stockbrokers, but its more sensitive and consequential around these issues.

There is lots of grey area within all this and what a “reasonable” amount to be paid when working on important social issues is often complex and relative.

But, for me, this is why social business is so exciting.

We have the capacity to take on these challenges and remove the limiting effect of money at either end of the scale: avoiding the suspicion that donors and funders have for anything but very modest salaries in the charity sector and the all encompassing influence of shareholders and profit margins in the private sector. The achievements of both those sectors far outweigh what has come of the very young social enterprise sector thus far, but there is so much potential there.

In the face of objections to corporate employment of free youth labour and demands for restraint on the subtle privatization of the NHS, the current government is at a point where this interaction between social change and profit-making is as tense and relevant as ever. And I hope that this becomes a moment for serious debate around it.