European Economic and Social Committee Social entrepreneurship and social enterprise Ariane Rodert

Background – why social enterprise? Lisbon treaty, Monti-report calls for a highly competitive social market economy EU 2020 highlights social economy, social enterprise and social entrepreneurship i.e.Innovation Union and Platform against poverty and social exclusion Contribute to the EU2020 targets: Smart growth = social innovation Sustainable growth = environmental impact, long-term vision Inclusive growth = people and social cohesion Crisis calls for social innovation - no more business as usual (Andor ) Single Market Act, remained a priority Social entrepreneurship and social enterprise create both social and economic outcomes Social economy is already an important actor*: 2 million social enterprises in the EU Employs 11 million (6% of all) 1 of 4 new companies are social enterprises * KOM(2011)682 s 3

The EESC:s work on Social Enterprise EESC member represent key social economy actors, key expertise and knowledge EESC has produced significant work in this area previously: Voluntary organisations and foundations in Europe SOC/347 (1998) The Social Economy and the Single Market INT/029 (2000) Role of Social Economy enterprises in the economic diversification in the accession countries CCMI/006 (2004) Ability of SMEs and social economy enterprises to adapt to changes imposed by economic growth INT/242 (2004) Opinion on Commission Communication on Cooperative Societies Promotion INT/238 (2005) Diversity of forms of enterprise INT/447 (2009) Social entrepreneurship and social enterprise INT/589 (2011) Specifically mentioned in President Nilssons work programme on social economy and sustainable businesses * KOM(2011)682 s 3

Process in summary Single Market Act - April/2011 Commission request for exploratory opinion - June/2011 EESC internal process: Open consultation July-September Public hearing - July 28 Two study groups - July and September INT-section - October Plenary adoption - October 26 Commission launch communication "The Social Business Initiative - October 25 Commission conference Promoting Social Entrepreneurship – November 18 Implementation of Commission key actions – EESC follow-up opinion on SBI and related areas

EESC Opinion Definition for social entrepreneurship and social enterprise Key priority areas 1.Including social enterprise in public enterprise policy 2.Stimulating social investment 3.Modernising public financing 4.Launching development programmes for social enterprise 5.Building awareness of and trust in social enterprise 6.Other comments (volunteers, employees, new member states, external relations)

EESKs definition Primarily social objective over profit, producing social benefit, public interest Surpluses principally reinvested towards social aim Variety of legal forms and models, often hybrid Economic operators producing goods and services (often (SGI) Independent entities, participation, governance and democracy Often connection to civil society organisations

EESC key recommendations Full implementation of Commission action plan at all levels Describe social enterprise based on shared characteristics Include social enterprise in public policy enterprise initiatives/programmes on equal terms Promote cross-border initiatives through European meeting-places, ideas, models Top priority better access to tailored capital - share good practice and innovative initiatives Ensure EU regulatory framework support, not hinder new instruments Target structural funds explicitly towards social enterprises Launch EU-wide comparison of suitable public financing methods Encourage and assess tenders with social considerations, tackle "gold plating

EESC key recommendations Consider full state aid exemption of social services of general interest, or small-scale public services, certain social services Review and share specific tax regimes Develop support programmes for social enterprises and of social entrepreneurs Explore European system and use current models for measuring social outcomes Study existing social labels Include social enterprise research, innovation and development programmes Collect and share statistics on social enterprise in Europe Particular emphasis on new Member States to ensure the emergence of social enterprise

Commission Communication Social Business Initiative Creating a favourable climate for social enterprises, key stakeholders in the social economy and innovation Commission definition of social enterprise to cover the following types of businesses : Those for which the social or societal objective of the common good is the reason for the commercial activity, often in the form a high level of social innovation Those where profits are mainly reinvested with a view to achieving this social objectives, And where the method of organisation or ownership system reflects their mission using democratic or participatory principles or focusing on social justice May also include: Provision of social services and /or goods Business with a method of production of goods or services with a social objective

Commission Communication Social Business Initiative Action plan with 11 key actions 1) Improving access to funding - facilitating access to private funding and mobilisation of EU funds European regulatory framework for social investment funds Progress Microfinance Facility Structural funds 2) Increasing the visibility of social entrepreneurship – developing tools to understand the sector, increase visibility, reinforce managerial capacities, professionalism and networking Identify and replicate best practices and models Create public data base for labels/certifications Promote mutual learning and capacity building Single, multilingual data and exchange platform Promote community programs aimed at social entrepreneurs 3) Improving the legal environment – developing European legal forms, public procurement and state aid Statute for Cooperative Society, European Foundation Statute, Mutual Societies Enhance quality in procurement Simplify State Aid rules to social and local services

Commission Communication further ideas… Exchange of good practices public, semi-public financing Access to venture capital Social enterprise and European Year for Active Ageing 2012 Promote research of socio-economic impact Block-exemption, new state-aid category Best practice sharing national tax regimes Use of accumulated capital, asset locks Strategies, funding dialogue social enterprises and financial institutions Dormant patent access Trading platforms etc. Volunteers and donations European statute for other forms such as associations

Next steps Build awareness and stress implementation at Member State level Closely connected to EU2020 Must be prioritised in National Reform Programmes investment priorities in ESF etc. Key in social innovation initiatives Public procurement, state aid… Volunteering and civil dialogue. …etc. Key is role and competence of public authorities Role of the EESC, the ESC and the Liaison Group: Follow implementation and further development Provide input, expertise etc. Link to national level

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