2. Overview RISE – what we are and what we do What is social enterprise Social enterprise in the public sector Social objectives and standards Examples of social enterprises Governance Opportunities and further support
3. RISE RISE supports the development of sustainable social enterprise Membership BAN Newsletter Projects – marketing, leadership, food, housing, health and social care Business support and Training
4. The Big Picture Private Sector Third Sector/Civil SectorSocial EconomyMutuals/Co-operatives/Charities Public Sector
5. Social enterprise in the UK At least 62,000 social enterprises in the UK (SEC, Summer 2009) Represents 5% of all businesses with employees Combined turnover of about £27 billion Previous research (SEU, July 05) found that the South West was the 3rd largest region for social enterprise in the UK
8. Examples from local authorities – Sandwell Community Caring Trust Tone Leisure Pluss Selwood Housing Community Foster Care
9. What do they do? There are social enterprises working across all sectors of the economy, from healthcare to hospitality, retail to recycling. Some of the most high profile include Fifteen (pictured), Divine Chocolate, The Big Issue and more locally Eden Project If you want to change the world and make a profit while you’re at it, then social enterprise is the smart choice.
20. What are they? Some definitions: 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 (BIS) Businesses that aim not only to make money, but also to have a positive effect on the communities they serve, the people with whom they work and their own employees (Co-active) Social enterprises are businesses that trade in order to pursue a social aim (Business Link)
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22. Characteristics of a successful social enterprise Gaining independence and autonomy through trading Entrepreneurial, innovative, risk-taking behaviour Flexible and adaptable practices Customer and community focus Stakeholder engagement
23. What do they do? Offer social or environmental goods and services e.g. recycling or childcare Trading to provide (or cross-subsidise) social or environmental goods or services Trading arms of some charities Use processes or ways of working that have significant social benefit Care workers organise themselves as a co-operative in order to take control of their work environment
24. Example 1 Carfax Health Enterprise Formed in 2009 through the merger of the Daniel Gooch Practice and Swindon Walk In Centre is a Community Interest Company run by the staff, for the benefit of the patients reinvests profits for the benefit of patients and improving services Works out of the Swindon Health Centre
25. Example 2Selwood Housing, Trowbridge Founded in 1989 by West Wiltshire District An independent housing association & registered social landlord 5200 properties across Wiltshire & Somerset & 150 staff Selwood was the first housing association in UK to get the SE Mark
27. Social Enterprise Mark National programme 352 holders (and growing) Marketing www.socialenterprisemark.org.uk
28. Consumers Demand New Ethical Logo – Research carried out by RISE in 2009 75% would prefer to buy from firms who put their profits back into the community 81% believe a lot of companies pretend to be ethical to sell more products 86% perceive some benefit from the Social Enterprise Mark 74% would rather buy from a company that makes decisions based on concern for society and the environment
30. How are they different? How are social enterprises different from ‘traditional business’? voluntary and community organisations? public sector? Clear focus on social objectives Trading and generating profits – financial, social, environmental
31. How are they different? Measures of success Traditional business Operates in the interest of the owner or shareholders To make profit A social enterprise has broader measures Profits are invested in social purpose Local good-quality employment Spending money in the local economy Providing an alternative business model
32. How are they different? Social Enterprise / VCOs & Charities Profit-driven trading Public service, non-trading
33. Discussion & feedback In small groups discuss these questions Why might you chose social enterprise? What might be the social objectives for your community (however you define it)?
34. Why choose social enterprise? Founders of social enterprises are motivated by A desire to improve their community Values that motivate partnership working Member involvement Concern for local services
35. Where do they come from? Local residents are offered a community facility if a sustainable business plan can be written A crèche is becoming large and parents would like to develop to a full-time nursery Local residents in partnership with the local council develop a disused site as business units to improve employment opportunities Community recycling project develops into sustainable business with local employment Voluntary group wishes to expand its activities and become more commercial A group of workers buys a business from their retiring manager
36. Where do they come from? A community centre offers training and skills development through accredited courses A group of workers creates a co-operative catering business A funded project coming to the end of its funding package wants to continue by charging for services and delivering under contract Regeneration activity has inspired a community to set up a development trust to continue managing community assets Community composting through volunteers has grown and needs to become a community business
37. Example - COSMIC Providing ICT support and services Turnover £500k, 16 employees > 50% income from trading Membership Focus on rural ICT, skills, employment Digital Inclusion …and now .. leadership
44. Where do Social Enterprises fit? Public services – changes to their delivery and support Health and social care Local authority business units Community Land Trusts Probation and offender schemes Free schools Supply chains
45. Public sector to social enterprise The big issues include: Culture change Business structures Business planning Staff engagement (including trade unions) Accountability (funding bodies - stakeholders) The workforce can be a mix of staff and volunteers
46. What are barriers for social enterprises working with local authorities? New, small and less experience Higher costs – not cheap alternative (triple bottom line) Lack of understanding of social enterprise model Possible changes to staff contracts Lack of time and resource Size of contract Time investment and opportunity costs - capacity Lack of relationships and ‘dialogue mechanisms’ Mission drift? Protection of intellectual property rights
47. Forms of social enterprise Community Interest Companies (run by and for a particular community) www.cicregulator.gov.uk Co-operatives (businesses owned and run by a group of people for the benefit of their members) www.coop.co.uk Development Trusts (community based and owned regeneration enterprises) www.dta.org.uk
48. Forms of social enterprise Social Firms (businesses that have a significant number of employees with a disability) www.socialfirms.co.uk Trading arms of some charities Charitable company with a community business that transfers surplus to the charity Industrial and Provident Societies Credit Unions, community owns shares in a shop or centre
49. Setting up a social enterprise – the issues Defining your mission and attracting others Agreeing business and social purpose Planning business viability How to handle profits and assets Democracy and accountability
50. Opportunities and risks What social enterprise opportunities are there for you? What are the risks?
51. Incorporation A social enterprise is usually an incorporated body (a company) Protects individuals from personal liability Winding up – debt Something going wrong Needs to be seen to be accountable and open Difficulties of engaging people if no safeguards Own legal identity Limits of protection
52. Forms of Incorporation Private sector company options Company limited by guarantee Company limited by shares (private or public) Social enterprise sector company options Company limited by guarantee Community Interest Company Industrial and Provident Society (IPS) Charitable or not charitable?
53. Forms of Incorporation One member one vote Clear membership terms supporting the objectives Surplus distribution for social purpose Community assets to be safeguarded (asset lock) Distribution of assets or bonuses evenly among the members (in a co-operative)
54. Models of social enterprise Co-operatives – IPS Workers own the business – worker co-operatives Co-operative Consortium – self-employed people or other businesses combining in marketing etc Community Business – CIC, Company Ltd by Guarantee Owned and run by a community Representation from the workforce, the locality, other organisations Development Trusts Asset-based development with community ownership Often a range of projects under one umbrella organisation
55. Sources of start-up capital Membership subscriptions or share capital Start-up grants and loans Borrowing from financial institutions Community Development Finance Leasing and hire purchase Personal funds Fundraising Volunteer labour Asset transfer
56. Sources of start-up capital Commercial Loan Community Development Finance Institutions: www.cdfa.org.uk Bridges Community Ventures Ltd Charity Bank Cooperative and Community Finance South West Investment Group Triodos Bank Wessex Reinvestment Trust Group
57. Trading Income Consider: Reinvestment in the social enterprise Keeping adequate reserves Looking beyond grants Making use of tax incentives
63. Support systems National Mutuals Information – www.mutuals.org.uk Co-operatives UK www.cooperatives-uk.coop Social Firms UK www.socialfirms.co.uk Social Enterprise Coalition www.socialenterprise.org.uk Development Trust Association www.dta.org.uk
64. Support systems RISE – Business Advisors Network (BAN) Newsletter Business Link Look up your local support organisations. The RISE website gives a list of these in the South West. www.rise-sw.co.uk
Health warning on figures – the surveys from recent years have been based on basic data collected mainly online and with self-selection as a key way to identify social enterprises – the only current mechanisms for measuring the numbers of SEs against agreed criteria is the SEM – but that work is very early in development and numbers are low so far – so its better to go with the big figures which help to promote the collective scale and scope of SE
There will be more examples as we go through the workshop
TIM TO LEAD : Purpose here is to get participants to identify what might motivate them in developing or working in social enterprise, having seen a definition and some examplesAfter a few minutes (5/10) ask individuals/groups to feed back what their social objectives might beIt might be useful to write these up on flipchart so as to be able to refer to it later
TIM TO LEAD: Purpose here is to further test and embed participants understanding of SE and their motivation, and to further illustrate social objectives.So having seen a bit more detail – lets see how this might apply to you. -
Add these if not already raised by the group
Digital inclusion – our key social objective – has led us to working with a wide range of people, ages, backgrounds and abilities – from complete novices and the fear factor – to highly talented young people keen to make the most of their technology skills in developing career opportunities.
Rural outreach and tackling rural isolation through campaigns and projects has featured highly in our work – back in 2001 when we launched the space shuttle we were campaigning hard on the issue of rural broadband provision at good speed and affordable prices – who would have thought we’d still be doing that 10 years on!
Keeping people up-to-speed with ICT development is an ongoing challenge – team of digital mentors working with groups and individuals – very focussed on skills development to improve business, organisation and individual capacity in economic terms
Key to Cosmic’s success has been the investment in people on the team – e.g. Becky
Diversification for Cosmic meant linking our experiences and success to a programme which we could offer to other social enterprises – which is the Leadership Development programme. Has run for 2 years now and will be developing further in the coming months to offer a wider range of services and support to social enterprises. After this offer opportunity for questions
What are the key challenges which you feel will be faced in moving from public sector provision into social enterprise?
TIM TO LEAD: Discuss in small groups and feedback using a basic SWOT formatDiscuss in whole group and refer to support slides coming up where appropriate
