Partner Article

All about social enterprise with Kate Welch from Acumen Trust

Social Enterprise: a business with primarily social objectives, whose surpluses are principally reinvested for that purpose in the business or community rather than mainly being paid to shareholders or owners

Why do people start social enterprises?

A social enterprise is a response to a social or environmental issue that can be tackled through a business model rather than relying on charitable giving. It combines the best of business with a passion for making a difference to society. Social entrepreneurs are motivated by making finding a sustainable solution rather than by making themselves rich.

How do social enterprises work?

Some are very commercial. They sell a product or service and then use the profit to address the social issue eg One Water.

Others use their business to support the social issue they are tackling eg Blue Sky, a landscaping company where you have to be an offender to gain employment

How can you tell if a company is a social enterprise?

There is now a national accreditation scheme, The Social Enterprise Mark. Check out the criteria here to know if you are doing business with a social enterprise.

What company structures exist for social enterprise?

There is no one structure. Social enterprises are often companies limited by guarantee, sometimes a registered charity or a co-operative. New structures such as Community Interest Companies also exist which make the social objectives very clear. The only objective test is the social enterprise mark so it is wise to look at any social enterprise in that light.

How many social enterprises are there in the UK?

The last full survey was carried out in late 2008 and identified 62,000 social enterprises. Because of recent government policies supporting social enterprise as a way of doing business this is likely to have increased.

What support is available for social enterprises in the North East?

NESEP (North East Social Enterprise Partnership) is the infrastructure organisation for the North East and can signpost social enterprise to the relevant support.

What funding is available for social enterprises?

A true social enterprise is first and foremost a business so should not be reliant on grant funding for ongoing revenue. Many do use grants for start up funding and these are often through grant-making trusts and foundations. There are a number of funding sources specific to social enterprises that offer loan finance such as the Social Investment Business or The Social Enterprise Loan Fund and more potential social investors are coming forward as the plans for the Big Society Bank (now called Big Society Capital) develop into reality.

This was posted in Bdaily's Members' News section by Kate Welch .