Social Enterprise: A Global Comparison

8: Japan

ichiro tsukamoto & mariko nishimura Japan 8Since the early 2000s, the concept of social enterprise has increasingly attracted public attention as an alternative business model for traditional nonprofit organizations, businesses, and public-private partnerships in Japan. Recently, the Japanese national government and some local authorities have become interested in the potential of this model, particularly for the regeneration of local communities and social integration , although their approaches are still ad hoc. The purpose of this chapter is to explore the conceptualization, current state, and potential of social enterprises in Japan as well as challenges to their sustainable development. It begins with a discussion of the concept of social enterprise in Japan by reviewing previous studies on the topic by Japanese authors. This is followed by an analysis of the state of the current emerging social enterprise movement and its implications for traditional nonprofit organizations, businesses, and public-private partnerships . Next, we examine the legal framework and supportive environment for social enterprise development and the actual operations and social impacts of social enterprises. Finally, this chapter brings to light some challenges facing the sustainable development of social enterprises in Japan. the concept of social enterprise in japan Although the approaches to social enterprise in Europe and the United States can be di√erent (Kerlin, 2006a, 2006b), much of the literature from these regions has viewed social enterprises as socially innovative, entrepreneurial , hybrid organizations. Dees, Emerson, and Economy (2001) endorse the concept of social enterprises as organizations that have a social intent as their primary objective but that also blend social and commercial methods. Therefore, social enterprises can be considered hybrids of commercial and philanthropic approaches. emes (Borzaga & Defourny, 2001) 164 social enterprise and other research networks (Nyssens, 2006) highlight their hybrid character as multigoal, multi-stakeholder, and multiple-resource enterprises. Even in countries where a more supportive environment has been created, there is no universal and commonly accepted definition of social enterprises. This is also true in Japan. Social enterprise, or shakaiteki kigyō, has remained an ambiguous and relatively new term, even among scholars and practitioners who are involved in the third sector. The legal and organizational forms of social enterprises also tend to vary. Actually, the concept can cover di√erent legal entities, such as the specified nonprofit corporation, also known as npo hōjin (Tsukamoto & Nishimura, 2006), as well as cooperatives and business enterprises that take on the legal forms of limited liability companies and joint-stock companies. Instead of ‘‘social enterprise,’’ the term ‘‘community business’’ has been more commonly used in Japan to describe nonprofit organizations or businesses with a hybrid character. Since the late 1990s, the community business concept has become popular among nonprofit practitioners and policy makers and tends to be associated with the policies of local community regeneration. Hosouchi (1999) introduced successful cases of community businesses in the U.K. to Japanese society and applied this imported concept to similar activities in Japan. He defined community businesses as ‘‘local businesses by local community.’’ However, proponents of community business do not necessarily stress their entrepreneurial character and approach to broader social issues beyond the locality. Since the early 2000s, however, emerging innovative and hybrid organizations that have combined social and economic goals have increasingly utilized the concept of social enterprise or social entrepreneur instead of community business. These social enterprise concepts tend to be concepts imported from other European countries or the United States. Thus, their approaches to social enterprises have been influenced by European and U.S. social enterprise schools and practitioners such as the emes Network (Borzaga & Defourny, 2001), Dees (Dees, Emerson, & Economy, 2001), CAN, and Social Enterprise London (sel) (2001). Four main social enterprise schools of thought have emerged in Japan. The first groups several approaches to social enterprise into what can be called the social innovation school. Machida (2000), an early influential proponent in the emergence of the concept of social enterprise in Japan, introduced the concept of social entrepreneur, or shakai kigyōka. He presented advanced cases of U.K. social enterprises that Leadbeater described tsukamoto and nishimura, Japan 165 in a demos publication (1997). However, his concept of social enterprise has limited usefulness in Japan, since it is an imported concept from the U.K. and the United States and was not based on both theoretical and empirical work. By contrast, Tanimoto (2006) contributed an advanced approach to academic...