EU plots course for social enterprise support

Europe and its citizens are at a critical crossroads – this statement isn’t likely to stop the presses, but the map given by the Expert Group of the European Commission on Social Entrepreneurship (GECES) to the drivers of the social entrepreneurship vehicle might take Europe to the right path.

The report, Social enterprises and the social economy going forward, adopted last October, is noteworthy in that it delineates the direction of social entrepreneurship policy development for the years to come.

It should also be a significant impetus propelling forward the social entrepreneurship agenda within the European Union, and thereby giving a boost to social enterprises in the region. 

With the launch of the Social Business Initiative (SBI) in 2011, the European Commission confirmed social entrepreneurship as one of its priorities. The SBI encompasses measures that aim to create an enabling financial, administrative and legal climate for the flourishment of social enterprises. 

GECES, the multi-stakeholder task force mentioned above, was appointed specifically to advise the Commission on how to best implement the SBI’s tenets, and on developing further policies that promote social enterprises.

As an outcome of its work, the Expert Group has released recommendations for specific measures that the Commission, as well as national authorities, should put into effect. 

The GECES report is a bold proposal for a sweeping policy framework on social entrepreneurship. Thirteen recommendations collectively make up a dedicated European Action Plan for the Social Economy and Social Enterprises, spanning four thematic areas that build on the themes of the SBI: 

  • Chapter 1: informing about and giving legitimacy to social enterprises; 
  • Chapter 2: strategically unlocking private and public funding; 
  • Chapter 3: developing social enterprise-friendly legal frameworks at the national level;
  • Chapter 4: championing global cooperation on the issue of social enterprises 

The European Venture Philanthropy Association (EVPA) has substantially contributed to the development of the recommendations on ‘Improving access to funding’ under the leadership of Rapporteur Lisa Hehenberger.

The policy direction in this area is pioneering, recognising and addressing the diversity of financing needs depending on enterprise maturity, of financing instruments available and institutions offering them, as well as of specificities of the social entrepreneurship ecosystems across Member States. 

Given its active involvement in building the venture philanthropy/social investment sector, the EVPA supports GECES’ call for the development of “an adequate financial ecosystem.” This is a key precondition to harnessing the synergies to be achieved from public efforts to unlock private funding, which can correct market failures and step in to complement public funding, where insufficient. 

The potency of the report lies in its nature as a call to action. Not only is the Commission compelled to lead in supporting social enterprises and developing their ecosystem, different actors invested in the sector are invited to actively participate in the process.

The Action Plan derives its considerable utility from the highly practical nature of the recommended measures.

In the midst of daily uncertainties as to the terms on which terms Britain will exit the EU, who will soon be elected to lead France and the Netherlands, or what role the US will play on the international arena, it is comforting that at least the social entrepreneurship agenda might be moving forward in the right direction.

Co-authored with Elinor de Pret of the European Venture Philanthropy Association

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