What is a Social Enterprise
Are you a social enterprise?
The OECD said in 1999: Any private entity conducted in the public interest, organised with an entrepreneurial strategy but whose main purpose is not the maximisation of profit but attainment of certain economic and social goals, which has the capacity of bringing innovative solutions to the problems of social exclusion and unemployment.
See our Discussion Topics on how such enterprises might be funded and financed.
Clive Munn FEM
Regarding whether you are a social enterprise or not, the main issue is the question of whether you are a not for profit, social enterprise or not. I do not believe that it is the legal structure that dictates this but more your own internal ethos. I think the board of directors who are the leaders of the company should adopt something like an 'internal charter' so that, at least the company is clear, at board level, of their purpose. Of course the Articles of Association must be open enough to encompass such an ethos.
In fact there is no single right or wrong on this and currently each country has their own way of presenting these issues. It is however evolving and at MFTSE Affairs S.A. we want to participate in these discussions in order to change things around the world. Luxembourg is probably somewhere between the Belgian and French positions but there again there is a lot of state or semi-state influence due to the size of the economy.
As an innovative social enterprise, we have to advocate change do things differently. For example, if we were ever to float on the stock exchange, as a social enterprise, our shares should be valued according to our social or cultural impact plus our environmental footprint and the environmental profit and loss, not according to how much profit we made this year compared to next or how much that profit is going to increase. This is what is mean by helping to change the world as it is now!
Of course, you could have, within your company, a not-for-profit project but in reality it must always come from the 'mother' company. Of course it must not be an after-thought nor that the ‘project’ is viewed as window dressing or taxation optimisation for example. The whole point is that it is and has to be part of your entire culture and ‘raison d’être’ from the very beginning.
The real issue is that there is not a legal structure currently available anywhere that can encompass these values or merge social with market ideals. An asbl in Luxembourg for example does not have shares and some say that a not for profit should not have shareholders either but I believe they are wrong! Surely a market economy can have a socio-economic conscience?
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