What is social entrepreneurship?


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Presentation by Agnese Lešinska, Legal Advisor and Researcher of the Public policy centre PROVID at the Social Entrepreneurship Forum in Riga on November 8-9, 2012 For more information visit: http://sefriga.lv/

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What is social entrepreneurship?

  1. 1. What is socialentrepreneurship? Agnese Lešinska
  2. 2. Research project• Aim – to identify legal framework (definitions, criteria), support instruments (financial, non financial) for social entrepreneurs in 11 EU countries and provide proposals for Latvia• Team - PROVIDUS and Civic Alliance – Latvia• Authors – Agnese Lešinska, Gatis Litvins, Rasma Pīpiķe, Inta Šimanska, Oskars Kupics, Katrīne Bušēvica• Financial support – Soros Foundation - Latvia
  3. 3. Situation in Latvia• No legal framework for SU• Can be business companies or NGOs (with limitations)• No specific financial support (f.e.- subsidies for unemployed or disabled persons)• Mostly dealing with unemployment issues• Start-up companies or not older than 3 years• Small companies, employing 3-5 permanent staff
  4. 4. What is social entrepreneurship?- Criteria used in legal frameworks• Mostly to describe WISE for example – 1) it is entered in the trade register under the said Act; 2) it produces goods and services on a commercial principle; 3) at least 30 per cent of the employees in the company’s employ are disabled persons, or at least 30 per cent of all employees are disabled and long-term unemployed (percentage of placed employees); and 4) it pays all its employees, irrespective of their productivity, the pay of an able- bodied person agreed in the collective agreement, and if no such agreement exists, customary and reasonable pay for the work done. (Finland)- Criteria used in theories
  5. 5. EMES criteria for SE• continuous activity producing goods and/or selling services• high degree of autonomy• significant level of economic risk• minimum amount of paid work• an explicit aim to benefit the community• an initiative launched by a group of citizens• decision-making power not based on capital ownership• participatory nature, which involves various parties affected by the activity• limited profit distribution
  6. 6. European Commission “Social Business Initiative”Social entrepreneur is:• an operator in the social economy• main objective is to have a social impact rather than make a profit for their owners or shareholders• it operates by providing goods and services for the market in an entrepreneurial and innovative fashion and uses its profits primarily to achieve social objectives• it is managed in an open and responsible manner and, in particular, involve employees, consumers and stakeholders affected by its commercial activities
  7. 7. Muhamed Junus – social business• Business objective will be to overcome poverty, or one or more problems (such as education, health, technology access, and environment) which threaten people and society; not profit maximization• Financial and economic sustainability• Investors get back their investment amount only. No dividend is given beyond investment money• When investment amount is paid back, company profit stays with the company for expansion and improvement• Environmentally conscious• Workforce gets market wage with better working conditions• ..do it with joy ..
  8. 8. Common criteria• Mission - main objective is to have a social impact or to solve a social problem• Profit - limited profit distribution• Business model - it operates by providing goods and a service for the market in an entrepreneurial and innovative fashion• Management - it is managed in an open and responsible manner and, in particular, involves employees, consumers and stakeholders affected by its commercial activities.• Appropriate remuneration
  9. 9. Contact and find us here: agnese@providus.lv gatis@providus.lv rasma@nvo.lv inta@nvo.lv www.providus.lv www.nvo.lv