The organizational form of
Social Enterprise in UK:
practice and enlightenment
Ellen Li 5 FEB. 2015
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[2.1] What’s social enterprise?
Social enterprise (SE) has
been a growing global
phenomenon for over
two decades.
Britain's social enterprise
sector is one of the most
successful and vibrant in
the world, championed
by government and
growing in scope and
scale.
Social enterprises are helping
to change society for the
better.
• They tackle some of society’s
most entrenched social and
environmental challenges.
• They set new standards for
ethical markets, raising the bar
for corporate responsibility.
• They improve public services,
shaping service design and
pioneering new approaches.
• They
increase
levels
of
enterprise,
attracting
new
people to business.
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[2.1] What’s social enterprise?
“businesses with primarily social objectives whose
surpluses are principally than being driven by the need
to maximize profit for shareholders and owners ”
(DTI 2002)
“Social enterprises are businesses that are set up to
tackle social problems, improve communities,
people’s life chances, or the environment. They make
and do things that earn money and make profits like
any business. It is how they work and what they do with
their profits that is different: working to make a bigger
difference, reinvesting the profits they make to do more
good.”
（ Enterprise UK, 2011 ）
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[2.1.1] What’s the difference between a
charity and a social enterprise?
What’s different?
Charity
Social
Enterprise
• Charities traditionally aim
to fund their social mission
through grants and donations.
• Social enterprises aim to
fund their social mission
through trading activities –
selling products and services
to customers.
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[2.2] History of the Recent Social enterprise movement
With the decreased economic growth and increased unemployment
that began at the end of the 1970s and continued into the 1990s,
many European welfare states experienced a crises.
Budgetary constraints were the main cause, but the crises was also
in terms of the effectiveness and legitimacy of state welfare
programs. Legitimacy was particularly undermined in the area of
unemployment as policies, especially for the long-term unemployed
(including the disadvantaged and low-skilled),proved not very
effective.
(Borzaga ＆Defourny,2001b)
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[Ⅲ] UK’s social enterprise status
62,000 social enterprises in the UK, contributing £24 billion to
the UK economy；
800,000 people employed by social enterprises in the UK；
5,450 co-operative businesses in the UK；
465 credit unions across England, Scotland and Wales；
260 community owned shops trading in England, Scotland and
Wales.
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[Ⅳ] organization and structure of social enterprise
4.1 Community Enterprises
which serve community of interest and
have representatives from the community
on their board of directors.
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[4.1.1] Case Study 1
Community Energy Warwickshire
It was set up by local
people living in
Warwickshire who
wanted to reduce carbon
emissions and increase
the use of renewable
energy.
•
over £100,000 through
Community Share
Offers；
• over 115,000 units of
electricity over the last
two years;
• saving around 58
tonnes of carbon.
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[Ⅳ] organization and structure of social enterprise
4.2 Co-operatives
provides direct benefit to its target
population, cooperative members.
• market information
• technical assistance
• collective bargaining power
• economies of bulk purchase etc.
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[4.2.1] Case Study 2
GLL (Greenwich Leisure Limited)
GLL is registered as an Industrial and
Provident Society as a society for the
benefit of the community, a popular legal
form for mutual enterprises.
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[Ⅳ] organization and structure of social enterprise
4.3 Trading arms of charities
set up to undertake trading
activity in order to raise
money for their charity
parent company .
e.g. charity shops,
catalogues, training and
consultancy.
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[4.3.1] Case Study 3
Age UK
Age UK was formed from the merger of
Help the Aged and Age Concern, creating
an organisation with a combined income of
around £160 million, including £47 million a
year raised through fundraising, and over
520 charity shops, and income raised
through its commercial services arm, Age
UK Enterprises.
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[Ⅳ] organization and structure of social enterprise
4.4 Community Interest Company( CIC)
A community interest company (CIC) is a new type of
company introduced by the UK government in 2005
under the Companies Act 2004, designed for social
enterprises that want to use their profits and assets for
the public good.
CICs are intended to be easy to set up, with all the
flexibility and certainty of the company form, but with
some special features to ensure they are working for
the benefit of the community.
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[4.4.1] Case Study 4
GATEWAY FAMILY SERVICES started life
as a department within South
Birmingham Primary Care Trust, but
became a Community Interest Company
(CIC) in 2006.
It was set up to tackle health and
employment inequalities by helping the
NHS and local authorities to identify the
needs of communities and encourage
local people to train to fill gaps in service
provision. Talked to Chief Executive VICKI
FITZGERALD about how the business has
developed and its hopes for the future.
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[Ⅴ] Supportive Institutions in UK
the Blair government
the Department of Trade and Industry (DTI)
Social Enterprise Unit
a three year program called “Social Enterprise: A strategy for
success.”
supportive environment
tax and administrative regulatory
recommendations
The Social Investment Tax Relief
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[Ⅵ] Enlightenment and Conclusion
Opportunities
Challenges
Enlightenment
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6.1 Opportunities
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• Social Entrepreneurs focus on key
areas contributing to the creation
of a harmonious society.
• Social Enterprises grew over the
past year and entrepreneurs have
an optimistic outlook for the
future.
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6.2 Challenges
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2
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• Less than half of social enterprises
achieve financial sustainability.
•access and retention of human
resources.
•government policy and the legal
framework
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6.3 Enlightenment
Write better legislation for the charitable sector.
Create a tax environment in which donations to charities
are truly encouraged.
Develop a more effective volunteer policy.
Promote a more developed charitable sector.
Make the sector more open, transparent, and better governed.
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Social enterprise’s future
will be better！
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