Oct 312017

Federica Massa Saluzzo “Entrepreneurs should generate economic value and solve social problems”

The first purpose of the Hospice de Beune was to relieve some of the misery caused by the 100 Years’ War (Photo taken by Beaune Tourism).

The first purpose of the Hospice de Beune was to relieve some of the misery caused by the Hundred Years’ War (Photo taken by Beaune Tourism).

1443 was a very special year in the history of social businesses. Much before any academic journal started spreading knowledge on how to design a business model for social development, a small and enchanting French town in the middle of Burgundy –in Beaune– started a process of social transformation that is still exemplary today in 2017.

It all began when Nicolas Rolin, a wealthy chancellor of Burgundy, and his wife, Guigone de Salins, decided to create a hospital for the poor. During that time, the number of poor people grew in the city due to the Hundred Years’ War, which had left devastation and famine all over the country. Hence, with the permission of the Pope at the time –Eugene IV– the philanthropic French couple started building the Hospice de Beaune.

Within a few years, the hospice became not only an architectural jewel, but also started adopting the latest technologies available to hospitals at the time. For example, each bed was equipped with a portable heater hidden below the mattress, in order to survive the cold winters of the north of France.

Another excellence of the hospice was the kitchen of the hospital. The nuns working in the kitchen cooked using only the very best of the local produce, coming directly from the farm owned by the hospice. Trivia: The patients of the hospital had to drink a lot in order to facilitate their healing but the quality and availability of water at the time was so poor that they had to drink another beverage, famous for its benefits on health: wine.

The hospice soon started to attract the attention of nobles and politicians who visited and not only admired the institution but offered generous contributions. Yet, the pure charity model sometimes had its limits and maintaining such high standards of quality on a regular basis was very expensive, even for Nicolas and Guigone. Therefore, they had to find a more sustainable source of income.

From a hospice to a prestigious wine brand

Picture from the Annual Wine Auction at the Hospices de Beaune (Photo taken by Alain Doire - Bourgogne Tourisme).

Picture from the Annual Wine Auction at the Hospices de Beaune (Photo taken by Alain Doire – Bourgogne Tourisme).

In 1457 one of the wealthy spectators of the growth of the hospice decided to make a peculiar donation, changing forever the destiny of the hospice. Guillemette Levernier offered the hospice a vineyard in the nearby countryside in Bourgogne. A vineyard could have appeared as an eccentric gift but Nicolas and Guigone were not only grateful but immediately hired the best managers to run the vineyard and produce high quality wine. Soon after the first donation of vineyard, others followed and today the Hospice de Baune’s estate amounts to 60 hectares of prestigious wine.

With wine production growing steadily, the Hospice de Beaune became one of the most prestigious wine auction venues of the industry. Every November, on the third Sunday, the major lovers and traders of wine in Burgundy gathered in the colourful and perfectly preserved rooms of the hospice to bid against each other in the famous auction.

The revenue of the sales of wine financed the development of the hospice. Thanks to this successful financing model, the hospice grew constantly throughout the years and has expanded to other areas where branches of the hospice were established.

The Hospice the Beaune represents a gem among social organisations. Its activity is inextricably linked to the economy of the region and to its geography. While pursuing a philanthropic objective, Nicolas and Guigone have created an economic power that connects different stakeholders (wine lovers, medical doctors, agronomists, medical doctors and patients) whose interchanges have resulted in a success for both the economy and society, lasting for 574 years.

The example of the hospice may inspire more and more social entrepreneurs to come up with similar ways to not only empower their local communities and generate economic value, but also solve social problems. À votre santé.

Post written by PhD. Federica Massa Saluzzo, researcher and Strategic Management professor at EADA.

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