Europe

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Flickr/CC/TaxRebate.org.uk

By Pia Chatterjee

The recent global economic crisis that had the world run in the opposite direction with its tail between its legs had severe consequences for both businesses and organizations with a social purpose. With drastic cuts in public spending and the extreme fall in consumption on the part of people like you and I, problems related to poverty, health and housing loom just as large as before (or larger, still) and people are hesitant, to say the least, to invest in budding enterprises.

With the change this triggered in the European landscape, social enterprise has emerged an attractive and viable alternative to address some of the issues plaguing Europe. Here are 10 reasons social enterprise is exactly what the region needs right now:

  1. Replacing charities. Most charitable organizations that function off of grants and donations have experienced the crisis firsthand with the lack of public resource to go around. Many of them are experimenting with social enterprise to build their own sustainability and continue their mission without having to depend on handouts. The social enterprise model allows the same services to be delivered at a fraction of the cost.
  1. They’re addressing important challenges like poverty, health, education and housing. The existence of these issues preceded the crisis, and these have only been aggravated since.  Social enterprise gives you a new opportunity to tackle these given that they are “adaptable”, so to speak, to this business model. More generally speaking, emerging problems like climate change that require collective participation and engagement have the potential to be addressed by this form without relying on the state either.
  1. Community involvement. With the collapse of publicly sustained services, people are inclined to opt for self-determination to tackle their difficulties. In the age of social innovation, high-speed technology and neglected social concerns, many youths have found themselves wanting to be entrepreneurial but also work for the common good and public benefit. Social enterprise provides just the platform and amalgam of the two fields to satisfy this pressing need.
  1. Jobs. As the social economy and enterprise sectors grow by the year, so does the number of people to whom they provide employment. Needless to say, this becomes vital in the period following a crisis like the one the world was subject to a few years ago. What’s more, many of these jobs are awarded to people who need it the most or who are usually disadvantaged in the labour market, be it the mentally challenged, homeless or ex-convicts.
  1.  Stimulate demand and motivate employees. Working for the common good or a greater cause tends to provide the required additional incentive to invest in something. Most enterprises of this kind stimulate demand and push consumers to buy products they would otherwise be less inclined to purchase simply because they feel themselves contributing to a larger social or environmental cause. Similarly, it also motivates employees to work for less since they feel their work produces something bigger than themselves that doesn’t necessarily demand the remuneration they would ask for in any other situation. It is precisely for this reason that social enterprises often recruit volunteers, more so than other businesses. Such work environments also tend to report higher levels of job satisfaction.
  1. Cut costs. Companies in this sector do not require investments in areas like marketing to the extent that traditional businesses do. Advertizing costs and other costs are significantly cut down simply because the social and public benefit purposes served create the publicity and demand you would normally need.
  1. Collective participation. Social enterprise encourages the participation of regular people and puts them in charge of the services they receive. This kind of bottom-up approach allows these organizations to appropriately respond to the emerging needs of society without the public sector. Since the stakeholders concerned are not only investors but directly involved in the workings of the company, much work gets done fast, efficiently, accurately and with very strong incentives.
  1. Resilience. – Cooperatives and other types of business models based in the social economy tend to be more resilient in the face of hardship or hostile economic environments. Most people and studies attribute this to the fact that such organizations are strongly-rooted in the community and treat obstacles that are consistent and often exacerbated by crises. Their focus on sustainability makes them resistant to hurdles from the start and offers them a natural armour to shield them from the consequences of recession on the market. These businesses are also very directly steered towards finding solutions to problems rather than towards technical definitions and production, making them likely to have a reason to persevere.
  1. Cards are stacked in their favour. With the present circumstances demanding an overhaul of the European economic system, there has been much talk of creating a new, sustainable, socially-oriented system that moves away from capitalism. The social economy provides just the potential substitute to respect these conditions: it is a model that can answer to the difficulties faced by Europe and survive in the long term.
  1. Transparency. The primary consequence of the economic crisis was a loss of trust. People are reluctant to leave their lives in the hands of others as they did before, and social enterprise proposes an alternative by clearly laying its cards out on the table. People know where their money is going and what it’s being used for, and what’s more, they appreciate the fact that it’s being used to help them and those around them.

 

The global economic crisis starved Europe of much-needed public services at a time where its citizens needed them most. It caused its leaders to realize the continent was in dire need of an economic rejuvenation to finally approach the many social questions that remained unaddressed. In a region that relies substantially on the welfare state, social enterprise does well to swoop in on its white horse to help bring the economy back on its feet.

 

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Flickr/CC/Quinn Dombrowski

By Pia Chatterjee

While being a pioneer in the sphere of “social economy”, France only witnessed the growth of social enterprise at the beginning of the 21st century. The evolution of this concept has made social enterprise exhibit its own unique and characteristic features that one must be aware of before the establishment of any social enterprise in the region. Here are 7 things you need to know before you set up a social enterprise in France:  

 

1. The French context is its own unique atmosphere.

Keep in mind that the French context has its own particular attributes, and that ventures from other countries can be modelled on but not identically transplanted from one context to another.  Aspects such as the French welfare state, labour laws, unemployment rates etc. all influence social enterprise in the country.

2. The relationship between social entrepreneurship and the state.

The state has been visibly more active in matters of social economy since the onset of the crisis. It has exhibited its influence through public policies, the establishment of new institutions, and the provision of or accessibility to new sources of finance. It is important to be aware of how the state may impact your business before the ball is set rolling.

3. Involvement of the European Union.

EU member states are known to be some of the staunchest supporters of social enterprise in the world. Be aware of the possibilities of public support at the regional level, and what type of work will most attract this kind of aid. Some models and sectors receive more attention at the EU-level than others.

4. Your type of model

France’s social enterprise is mostly composed of the WISE business models, and therefore largely limited to associations, cooperatives, mutuals and foundations, in order of their popularity in the French context. The type of model you choose would impact large parts of your business, including funding, employment hierarchy etc. You would therefore be advised to choose wisely (no pun intended).

5. Be aware of the sectors that have been influenced by current events.

Consequences of the financial crisis influenced a number of economic aspects such as the healthcare sector, the ageing population, unemployment, and the restructuring of the welfare state. These changes have consequentially created new and promising avenues for social entrepreneurship and the ‘solidarity economy’, making some business options more viable than others.

6. Incubators and social innovation. 

A number of well known incubators such as Social Good Labs, Paris Incubateurs and Le Comptoir de l’Innovation have steered themselves towards ventures that focus on both technological and social innovation. Considered a magnet for financial support, the term has been specifically referred to in national and regional policy schemes and reports and could be a useful characteristic to hone.

Flickr/CC/Le Camping
Flickr/CC/Le Camping

7. Social economy support networks.

France is home to an elaborate web of support networks that includes organizations such as Avise, Mouves, Les Scop and the Commité National des Entreprises d’Insertion (CNEI) which hope to create new jobs, enhance the role of social enterprises in the social economy, support individual entrepreneurs with their initiatives, and maintain sustainable work opportunities in the market. Be it the distribution of EU funds, the provision of a network platform for public authorities, or the facility of educational and professional training, these organisations are big players in the field of French social enterprise and cannot be overlooked.

 

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Flickr/CC/Quinn Dombrowski

By Timothy Jahl

 

For many of us, enjoying a refreshing beer at the end of a long day is something of a guilty pleasure. If your beer belly necessitates a bit of rationalization, fear not! These breweries give back to their communities in unique ways, allowing you to quench your thirst while knowing you are supporting a noble cause.

  1. Two Fingers Brewing Co.

Two Fingers bills itself as “the only beer brand that gives back to the men who drink it” as it donates all its profits to prostate cancer charities. The name is a none-too-subtle nod to the diagnostic procedure for this disease, and its all-too-evocative label art reminds you of this fact as you drink it. But if you can get past that, you will enjoy Aurelio, their crisp and light flagship beer. At the moment, it is their only product, but two new brews are coming soon.

  1. Hophurst Brewery

Hophurst brags that their beer is “crafted with a conscience,” but can back up their claim as they support multiple social outreach projects. First, Hophurst runs a training program to help members of their local community gain marketable job skills. Graduates of the program are either hired by Hophurst or given the tools to seek employment elsewhere. Hophurst also supports Drinkaware, a campaign to promote drinking responsibly, and closely monitors the social and environmental impact of their business. Their minimalist beers manage to achieve complex flavor without trying too hard.

  1. Boundary Brewing

Boundary is a co-operative that was founded on the principles of social enterprise and valuing people over profits. It is owned by its brewers and drinkers, and works to promote awareness of co-operative style enterprise and the benefits it can bring. A new brewery, Boundary is due to release their very first batch this year.

  1. Breugems Brouwerij

Breugems is another brewery with a mission to invigorate its local economy. In Breugems’ case, they run a training program targeting people with disabilities. They help about 50 disadvantaged people each year find work who might not otherwise be able to. Their line of beer has a very hand-crafted feel to it.

  1. Brew On Brewery

Like many others on this list, Brew On gives back to its community by providing training and jobs in an area that sorely needs them. Unlike the others on this list, however, Brew On does not make beer, focusing mainly on ciders and other fermented fruit juices. In addition to their training programs, Brew On donates at least 50% of their profits to social charities, and employs disadvantaged or disabled people as at least 50% of their workforce.

  1. Guinness

The only non-craft brewery on this list, Guinness is less hands-on than more locally focused groups, but still deserves a spot. As part of the celebrations for their 250th anniversary, Guinness established the Arthur Guinness Fund for Social Entrepreneurs, which distributes millions of euros each year to aspiring social entrepreneurs. Besides funding, the program provides practical support, mentoring, and workshops for its awardees.

Flickr/CC/CCharmon
Flickr/CC/CCharmon

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Flickr/CC/Benjamin Großmann Geese

By Pia Chatterjee

The Netherlands always seemed to have the potential to provide the ideal environment for social enterprise to thrive in: with some of the fastest growing companies in the world and a conscientious population, they call out to the socially engaged and innovative who have a knack for business. While social enterprise appeared to take a while to pick up, as of today the country hosts between 4,000 and 5,000 companies that can be classified as products of social enterprise, including ones such as WASTED, Greenchoice, Fair Trade Original, Greenwheels, Tendris, and more. These companies remain on par with their more traditional for-profit counterparts and continue to grow relentlessly.

One of them, Fairphone, recently won the Tech5 competition for being the fastest-growing startup in Europe, having competed with 4 other for-profit finalists from other countries. The company aims to produce cell phones maintaining a fairer and more transparent production process and ensuring that all the steps taken, from mining and design to manufacturing and life cycle, take into consideration ethical values. Fairphone’s aim is to reconnect consumers to their products and lessen their own adverse environmental impact.

With 60,000 Fairphones sold, the company is undoubtedly off to a good start. The reasons for this are manifold: Fairphone is entirely auto-funded and hasn’t had to rely on donations to function. Employing people from all over the world, it currently boasts the presence of 20 nationalities bringing together knowledge from across the globe. Furthermore, while it works tirelessly to address issues of worker welfare, mining and conflict minerals in electronics production, and supply chain transparency, it has also paid adequate attention to ensuring its phones are equipped with advanced software technology and high quality components. You have the possibility to change parts of your phone yourself thanks to the access they give you to spare parts, and you’re sure to be presented with a product that is not only fairly produced, but is of the same stellar quality as other highly demanded smartphones on the market.

It only goes to show that social enterprise has the full potential of competing with more conventional corporate forms in the market without having to take any supplementary steps or measures.

Having recently come out with its second edition, Fairphone now offers its customers an excellent quality phone priced at $525 that can be pre-ordered on the Fairphone website starting July 2015.

 

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