Dave Thornett Social Enterprise .

Dave Thornett

Social Enterprise

www.sheffield.ac.uk/enterprise


The term Social Enterprise describes an ethical framework rather

than being an industrial classification such as manufacturing and so

there are social enterprises operating in the fields of health, retail,

energy, leisure, construction, ICT, sport and many others, alongside

private and public sector organisations.

The Government definition of 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 profits for shareholders and owners”


Creating Social Change

1844: As a result of exploitative factory owners and shopkeepers who charged extortionate prices, 28 working men in Rochdale scraped together £28 to open their own shop – so heralding the beginning of the modern co-op movement.

1980s: ‘Community development’ became well established with a range of government grants and initiatives.

Recent years: growth of community enterprise, where businesses have evolved in poor and disadvantaged areas with the specific aim of improving the economic fortunes of their neighbourhoods. The voluntary sector, too, has become more innovative and enterprising. 1990s: ‘Social Enterprise’ had become familiar in the UK. This signalled the shift from grant dependency to income generation. In October 2001 the government launched the Social Enterprise Unit to champion social enterprise and spread good practice.


Social Enterprise Stats

Approx, 55,000 social enterprises

Employing 500,000 people

Combined turnover of £27 billion

Contribute almost 1% of GDP

(Social enterprise coalition 2006)


Legal Structure Overlay (additional characteristic to basic legal structure)

Badge

Company Ltd by Guarantee

Company Ltd by Shares

Industrial and Provident Society

Cooperative Company Ltd by Guarantee

Charitable Incorporated Organisation (coming soon!)

Charity

Community Interest Company (CIC)

Social Enterprise

Social Firm

Development Trust


Form Follows Function

IPS for Community Share Issues (Settle Hydro, George and Dragon Hudswell)

Company Limited by Shares for Commercial Joint Venture

Company Limited by Guarantee for Trading Subsidiary


Whatever the theme or formal legal structure they take social enterprises are bound by common principles such as:

• Social mission is interwoven in the fabric of the business rather than being

an add-on. For example his may manifest itself in a fair trade relationship,

the provision of important services not otherwise available or job creation.

• Social ownership and interest should drive the business model rather than

simply profitability for private shareholders. There are some legal models

that allow private shareholding, but dividends and returns are capped to

ensure the community benefit remains dominant over private profit.


National Policy Framework

The Think Smart…Think Voluntary Sector document produced by OGC and the Home Office in June 2004

Right to Request

Community Investment Tax Relief

Community Interest Companies

Asset Transfer

Social Enterprise Investment Fund


Rise of the Social Entrepreneur

Jeff Skoll

E-bay to Skoll Foundation

Muhammad Yunus

Banker and economist to Grameen Bank

Dr. Larry Brilliant

Google to Urgent Threat Foundation (via eradicating smallpox)


Case Studies1SOAR Build

MotivationEmployment, local control, income, qualityOwnershipShare capital private/social joint ventureImpactJobs Created, input to HMR, links to private sectorFutureLink to mainstream employment programmes, geographic expansion


Case Studies 2Bay Broadband

MotivationInternet access for the villageOwnershipMutually owned by local peopleImpactCheap broadband, real connectivity, reinvestmentFutureRegional network, sell model on, invest in new services


Case Study 3Fresh Pastures

MotivationEmployment, drive from local authorityOwnershipShare capital community interest companyImpactEmployment for people with disabilities (25% workforce) business turning over £5m in year 3. Strong SROIFutureIncrease employment, supply to new areas, support local dairies







Social Investment Houses

Yorkshire Key FundCharity Bank

Social Enterprise Investment FundCommunity BuildersAdventure Capital Fund

Unity Trust BankTriodos Bank



Companies House www.companieshouse.gov.uk

Co-operatives UK www.cooperatives-uk.coop

Governance Hub www.governancehub.org.uk

CICs www.cicregulator.gov.uk

Charity Commission www.charities-commission.gov.uk

Social Enterprise Coalitionwww.socialenterprise.org.uk

Social Enterprise Yorkshire and Humberwww.seyh.org.uk

Business Link Yorkshirewww.businesslinkyorkshire.co.uk

http://www.companieshouse.gov.uk/

Dave Thornett Social Enterprise .

Documents

social enterprises

champion social enterprise

term social enterprise

social enterprise unit

social mission

social change

social objectives

social ownership