I wouldn’t normally single out readers’ comments for specific mention, but Sebastien, in commenting on the post on Call Britannia here has raised a really important issue.
He says in his comment:
Sorry to rain on the parade but from what I know about this venture, this isn’t a social enterprise at all. Yes, it is great that an “enterprise” is being set up in an area of deprivation. But merely setting up a business in an area of deprivation should not, and does not make a social enterprise.
I think we have to be clear here – while this organisation may want to do “good” by employing people, the fact that it employs people does not automatically make it a social enterprise.
Essentially Karen is setting up a similar business that she sold off to the Daily Mail a number of years ago called Simply Switch – which employed people in Croydon. Perhaps using the social enterprise tag makes business sense for her now….
I wish this private enterprise well, but please use the correct labels…
So, when is a social enterprise not a social enterprise? Sebastien is probably right to be at least sceptical in this instance — but on the other hand, is it a bit too easy (or a bit too categorical) to simply say “this isn’t a social enterprise at all”? It has a social mission. A proportion of profits are gifted to a foundation to provide employment support to those who need it. It focuses its activities in areas of greatest deprivation. It has received investment from two specialist investment funds targeting businesses that make a financial and social return — Big Invest and Bridges Ventures.
Yet on the other hand, a Companies House search confirms that Call Britannia is indeed a Private Limited Company, and Big Invest’s Nigel Kershaw, quoted in an article in the Guardian recently said, “We spent time with Karen thinking what do we have to commit to, to make this a proper social enterprise, rather than just a business with some other stuff tagged on,” which seems to suggest that at least one of the investors recognises that Call Britannia is a hybrid form…
Of course, one might take the line that what would determine the real social enterprise nature of the business beyond doubt is whether it is operated on a non-profit distributing basis — i.e. is “not for personal profit”. This doesn’t appear to be the case.
But does that prevent it being a form of social enterprise? Or is there only one true form — not-for-personal-profit? Personally, I feel quite ambivalent about this. I know plenty of people in the sector who hold the latter view — that the only true form of social enterprise is not-for-personal-profit. But equally I know others who say “what matters is the social impact the enterprise achieves”.
One thing I am sure of — partly because policy and investment models are driving things in this direction — is that we will see more of these kind of private/social hybrids.
To my mind this strengthens the argument that social enterprise is a way of doing business rather than a specific, single ‘model’. But it would also suggest that some social enterprises may be “more social” than others….or, to put it another way, that some social enterprises are “more commercial” than others. Perhaps we need a new category — “private business with a social mission”?
While it might be more comfortable to simply say “this isn’t a social enterprise at all” this is to close one’s eyes to a distinct trend emerging in the social business sector. Denying the social enterprise status of such ventures doesn’t make them go away — and nor does it help us understand an increasingly grey area in the sector.
Sebastien has started a debate I hope others will join.