Thursday, January 12, 2006
In Britain we know about Charities, Co-Operatives and non-profit organisations. These are defined by some firm legal and practical structures. The idea of a 'Social Economy' concentrates less on how an organisation is structured and more on what its aims are.
Broadly, a Social Economy organisation or a Social Enterprise is a business with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than being driven by the need to maximise profit for shareholders and owners. In short it
· Accepts the need to generate income from its activities to meet its costs and obligations.
· Has a wide range of criteria for success. Not just the financial ’bottom line’ but some agreed set of public goods.
A Social Economy organisation could be a Co-Op or a charity, but it could also be very like a commercial organisation in its structure. The difference (it is claimed) is the use of business methods to achieve public goods. It works (in theory?) under market disciplines to achieve its ends. To expand this sector a new legal form (the Community Interest Company) has been created for Britain. The law regulating this (the CAICE Act 2004) came into effect in July 2005. A Regulator has been appointed for this new sector. It is not possible for a CIC to be a Charity, something LibDem MPs tried to change when the legislation went through Parliament as we feared this would divide the Social Economy field.
There are a number of support organisations working in some specific areas (such as London Bristol Birmingham and Scotland). There are also a number of national support organisations to give help and advice to potential Social Enterprises. If you need some further information try these links.
Social Economy Network
Social Enterprise Coalition
Nearbuyou National Social Trading Network
Social Enterprise Partnership
School for Social Engineers
Social Enterprise Training and Support
The Guild (Training and Consultancy to Social Enterprise Sector)
Business Link Social Enterprise Knowledge Centre
Social Economy Bristol (example of a Local Support and Development organisation)
What do you think?