The fourth sector

| Print |  Email
Articles - May 2014
Monday, April 28, 2014

BY LINDA BAKER | PHOTOS BY CARL KIILSGAARD*

*CHANG PHOTOS COURTESY MERCY CORPS

I. In the beginning, there were clear boundaries between the world of business and the world of nonprofits. The former revolved around financial targets like sales growth and investor returns — the latter aimed for collaboration and the social good. Then the world flattened; the economy collapsed, Internet technologies democratized entrepreneurship, and mounting anxiety about environmental degradation prompted businesses of all stripes to green their marketing, products and services. 

These shifts — some might call them seismic — set the stage for the emergence of what insiders are calling “the fourth sector” of the economy: hybrid organizations that are neither government agency, for-profit or nonprofit but contain elements of all three. The idea, and it’s still very much an idea, didn’t spring up overnight but instead grew out of several decades of change in which for-profits tried to become more socially conscious and nonprofits more market oriented, the latter often adding revenue-generating programs to supplement declining government funding.

So far the fourth sector is more theory than practice, more embryonic than fully formed, but the concept itself is yet another example of 21st-century innovation. At least on the for-profit side, it’s less about tacking a social mission onto business than an attempt to rethink the deep structure of business itself. Much as the sharing economy is less about a new product or service than a rethinking of the ownership economy, the fourth sector aims to create an entirely new model for simultaneously making money and effecting positive social change.

Skeptics might claim the idea is too good to be true, and that a hybrid model will only dilute profits while opening up new opportunities for green washing and other forms of exploitation — of consumers, the disadvantaged and the tax code. Potential drawbacks notwithstanding, one thing is clear: In Oregon a new generation of leaders is hot on the trail, launching an array of fourth-sector initiatives and projects. Impact funds, benefit corporations and social enterprise are among the jargon phrases that capture the various manifestations of their work.

Oregon Business caught up with a few of the key players in this “blended capital” space. Their goals are ambitious: to enlarge the boundaries of capitalism itself, marrying the financial returns generated by the market with the selflessness and community orientation typically linked to the nonprofit enterprise.



 

More Articles

Ski traffic

News
Tuesday, January 20, 2015
0121-skiway-thumbBY LINDA BAKER | OB EDITOR

A place-based multimodal transportation plan for Mt. Hood is long overdue.


Read more...

5 companies react to lower fuel prices

The Latest
Thursday, January 15, 2015
thumb-shutterstock 233787049BY JACOB PALMER | OB DIGITAL NEWS EDITOR

Consumers love the savings they get from low oil prices, but how has business been affected?


Read more...

Taking the lead in boosting Oregonians’ health and strengthening our economy

Contributed Blogs
Thursday, January 08, 2015
0108-injection-thumbBY CAMBIA HEALTH SOLUTIONS & OREGON BUSINESS COUNCIL | OP-ED

Businesses have a significant stake in the health of Oregonians. In fact, we cannot succeed without it. By committing to using our companies as levers for good health, we invest in our people, our business, our quality of life and our economy. 


Read more...

Tackling the CEO-worker pay gap

January-Powerbook 2015
Thursday, December 11, 2014
BY OREGON BUSINESS STAFF

An SEC rule targets the disparity between executive and employee compensation, reigniting a long-standing debate about corporate social responsibility.


Read more...

Behind the curtain: What students should know about accreditation and rankings

Contributed Blogs
Thursday, December 04, 2014
120414-edurating-thumbBY DEBRA RINGOLD | OP-ED CONTRIBUTOR

How important are institutional and/or program evaluations provided by third parties in selecting a college or university program?


Read more...

Old school: Paulsen's Pharmacy maintains old fashion ethos

The Latest
Thursday, December 18, 2014
121914-pharmacy-thumbBY MEGHAN NOLT

VIDEO: Under the radar — complete with a soda counter, the traditional Paulsen's Pharmacy looks to compete with big box retailers.


Read more...

Carbon Power

February 2015
Tuesday, January 27, 2015
BY LINDA BAKER

Researchers in a multitude of disciplines are searching for ways to soak up excess carbon dioxide, the compound that contributes to global warming.


Read more...
Oregon Business magazinetitle-sponsored-links-02
SPONSORED LINKS