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Social enterprise trending as business model… trending on campuses… and now in federal government supports…

by David LePage Principal, Accelerating Social Impact CCC

Purchasing options grow…

More and more everyday we have access to social enterprise products and services… just this week I enjoyed the coffee and chocolates from East Van Roasters and today I picked up honey and candles from Hives for Humanity – both operating in Vancouver’s Downtown Eastside as a means to break the barriers of social isolation and poverty.

Campus options grow…

A few years ago we wouldn’t have seen much about social enterprise on campuses of colleges and universities. But recent research from the British Council shows that “Higher education institutions (HEIs) are becoming a key source of support for new and emerging social enterprises in Canada…three in five Canadian HEIs housed an incubation space where new social enterprises can develop.” [1] Course content is adjusting as well. I just finished teaching an MBA class on Social Enterprise and Public Policy at the University of Fredericton a couple weeks ago in their new Social Enterprise specialty stream. [2]

Government supports grow…

On the public policy front we’re seeing social enterprise strategies emerge on the provincial level in Manitoba, Ontario, Quebec, and Nova Scotia.
And then last week with little fanfare the Federal government added their support to the social enterprise sector – providing clarity on a definition and supporting the development of a national directory.
Recognizing the growing social enterprise trend the federal government’s Ministry of Innovation, Science and Economic Development, ISED, is ‘identifying opportunities to support or lessen barriers to innovation and growth in the sector.’

The directory defines social enterprise as “an enterprise that seeks to achieve social, cultural or environmental aims through the sale of goods and services. The social enterprise can be for-profit or not-for-profit but the majority of net profits must be directed to a social objective with limited distribution to shareholders and owners.”
The Ministry definition is clearly signalling that from their perspective a social enterprise has to blend a community impact and insure the majority of profits are also reinvested in community. Rather than looking at a corporate structure, they have opted for a performance based model, which allows several different corporate forms to be included – if the purpose and the structure both align with and meet this definition.
What it doesn’t allow is a company that has a good CSR program or donates a percentage of profits to charity to claim social enterprise ‘status’. Just being a ‘good’ company or a valued corporate citizen, or using social washing in marketing, doesn’t make you a social enterprise. But, if your purpose is to create social value and your structure commits the majority of your profits to a community development goal, you do have the opportunity to register on this directory.

The directory will be a valuable tool for social enterprises to identify with a defined model, allow purchasers to know how to find social enterprise suppliers, and raise awareness on the website of the strength and value of the sector. The definition includes social impact, like employment for persons with barriers; it includes cultural impact, like so many of our local arts and theatre groups; and environmental impact, like community owned alternative energy.

There is no monitoring body or gatekeepers, so we will all have to be diligent to insure social enterprises that meet the criteria are posted and asking others that are not meeting the definition to use other directories, like CSR lists, Fair Trade and B Corps certification websites.
Without a doubt the social enterprise definition debate will continue. Some people will think this definition too broad; others will think it too narrow. But what is important is that we continue to drive this trend of social enterprise – in our classrooms, on-line, in government, and in our purchasing!

[2] .

Sep 8, 2016 | Tags: , ,