A social enterprise is not a charity. There is a clear distinction and it’s one that social entrepreneurs take incredibly seriously.
Social enterprises are, as defined by the government, ‘businesses with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or community, rather than being driven by the need to maximise profit for shareholders and owners’.
In other words, a social enterprise is a business that makes its money in a socially responsible way. These ventures are not necessarily formed to reinvest all profits into the communities. Social entrepreneurs can make a tidy profit themselves, but the point is, their business models also benefit others.
They complete alongside other businesses in the same marketplace, but use business principles to achieve social aims. Social enterprises prove that having a social and environmental conscious can go hand-in-hand with achieving financial success.
A few things all social enterprises have in common are:
When the government launched its social enterprise strategy in November 2006, Tony Blair said he had 'a vision of strong social purpose combined with entrepreneurial drive. Of robust businesses that could be highly responsive to customers and compete in the marketplace – but driven by a public service ethos and a cast-iron commitment to social goals’.
Blair said there was significant opportunity to boost not only society, but also the economy through the social enterprise approach.
Speaking at the 2008 Social Enterprise conference, prime minister Gordon Brown said:
“In the past the objective for any country – and any government – was twofold: building social cohesion and achieving economic growth. Today, there is a trinity of aims: fairness, prosperity and environmental care.
“If our economy is to flourish, if our communities are to become more closely knit, and if we are to take care of the natural environment and the resources on which our economic activity depends, we must find new and more equitable ways of doing business that are better suited to the times we live in now.”
So there you have it. Social enterprise is the business structure that will allow success to stand side-by-side with ethical purpose. Simply put, a better way of doing business, and one that must flourish for the good of society.