Last edited 17 Aug 2019

Social enterprise

Coffee cup.jpg

A social enterprise (SE) is a business that is set up to help people, communities or the environment either for profit or not-for-profit. SEs tend to have a mission – to try and change the world for the better but at the same time, they may try to make a profit for the benefit of society. These profits are usually reinvested or donated in an effort to bring about positive social change. Therefore, an SE may use commercial strategies to realise its ends and achieve improvements in financial, social and environmental wellbeing.

Social Enterprise UK is the national body for social enterprise and, along with its members, has become a strong voice for SEs. It defines a social enterprise as:

  • Having a clear social and/or environmental mission set out in its governing documents;
  • Generating the majority of its income through trade;
  • Reinvesting the majority of its profits;
  • Being autonomous of the state;
  • Being majority controlled in the interests of the social mission, and
  • Being accountable and transparent.

SEs can range from multi-million-pound health care and public service providers to community organisations and retail business. They can span private, public and charity organisations. SEs can be found in the high street, ranging from coffee shops and cinemas, to pubs and leisure centres, banks and bus companies.

Well-known social enterprises include:

  • Co-op grocery stores;
  • Café Direct Fairtrade coffee and hot drinks company;
  • The Big Issue publication;
  • Elvis & Kresse (making luggage from industrial waste);
  • The Eden Project in Cornwall;
  • Divine Chocolate, and
  • Jamie Oliver’s ‘Fifteen’ restaurants (closed in 2019).

Selling goods on the open market allows social enterprises to reinvest their profits either into their businesses or the local community, or to create employment.

As well as social and community-based objectives, SEs can also have charitable-based objectives. Typical examples of non-profit-based SEs can include sports clubs and voluntary groups as well as housing associations and probation groups.

A social enterprise can be set up to be a:

A community interest company (CIC) is a special type of limited company that aims to benefit the community rather than private shareholders. CICs can be set-up online for as little as £27.

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