Social Enterprise. The clue is in the name.

Social Enterprise. The clue is in the name.

Much has been written about the potential of social enterprise, but I share the concerns of many that, whilst social enterprise continues to be manoeuvred as a political plaything, the treasury loses sight of the real treasure that these ventures could yield.

As a global economy fighting for survival we need to unleash as many, and as varied, contributors as we can, and it’s clear to me that when it comes to social enterprise the clue’s in the name – a social enterprise is a venture that contributes to society, yes, but it’s also a business, so it also has a place to play in contributing to the economy. As such we should be doing everything we can to release its real potential.

The size of the prize

According to Social Enterprise: Market Trends’, May 2013, Cabinet Office, the social enterprise sector in the UK alone is estimated to employ more than 2 million people, and 15% of all SME (Small Medium Enterprise) employers are believed to be social enterprises (that’s 179,500 social enterprises that are employing people).

When we add the social enterprises that operate as sole traders, the total number increases to 688,200, and their combined annual turnover is a staggering £162.8 billion with annual Gross Value Added (GVA) estimated at £54.9 billion.

We need, collectively, to recognise that the social enterprise sector already makes a difference. The United Nations estimate that the livelihood of millions of people is secured by ‘mutual businesses’, through tackling a wide range of social and environmental issues; creating business solutions to achieve public good; and through their contributions to the economy at a macro, as well as a micro, level.

However it is clear that much more can be done. By engendering entrepreneurialism in the social enterprise sector, and encouraging more entrepreneurs to create businesses with a social or environmental purpose, the sector will grow. Without that push, it has the potential to diminish, through being side-lined and ultimately starved of resources.

Let’s not confuse social purpose with social behaviour

So what will really make a difference? Having a social purpose does not need to mean a social enterprise needs to behave any differently to any well led business in the private sector that has non-social aims (although it’s estimated that a third of all businesses in development actually aspire to be social enterprises!). Like any successful venture, social enterprises need clear aims as well as clear values, and they need the right people on board together with support (but not necessarily interference from) its stakeholders.

So let’s stop talking about ‘Governance’, and encourage the sector to focus on Leadership. Let’s stop leading the discussion through Government Policy and provide the resources to respond to market opportunity. And let’s stop preferring ‘collective ownership’ and ask social entrepreneurs to stand up and be counted, to truly drive change, take risks and make real, sustainable profits that will really change lives. Only then will we release the real potential of social enterprise.