Posted on 10th February 2010
A social enterprise charter mark has been launched nationally by the Social Enterprise Coalition to allow people to identify enterprises that use at least 50% of its profits for a social purpose and comply with other socially focussed criteria.
Peter Holbrook, chief executive of the Social Enterprise Coalition, said, "Social enterprises are businesses doing really extraordinary things in new and innovative ways, but they have until now been hard to recognise, partly because they work in practically every industry imaginable and range from community enterprises to international companies. The time is right for the introduction of a visually powerful mark that indicates, at a glance, the integrity of an organisation and around which we can drive awareness and understanding."
To qualify to carry the logo, which bears the stapline ‘Trading for People and Planet’, organisations must be able to answer ‘yes’ to the following questions:
• Do you have evidence of your company’s social and environmental aims?
• Does the company have its own constitution and governing body?
• Are at least 50% of the company profits spent on socially beneficial purposes?
• Does the company earn at least 50% of its income from trading?
• Can you provide externally verified evidence that you are achieving your social or environmental aims?
• On dissolution of the company, are all residual assets distributed for the social/environmental purposes?
The mark has been piloted in the South West of England by the voluntary sector umbrella body, RISE in consultation with the Office of the Third Sector. During the pilot phase, the cost of registering for the mark was related to turnover, but has been replaced by a flat-fee of £99. The aim is to have 2,000 businesses signing up to the mark in the first year of operation.
The scheme has already run into difficulty with the Scottish social entrepreneurs network, Senscot, which has criticised the relaxation of eligibility criteria. For the pilot, companies had to re-invest 65% of profit in a social purpose. Senscot founder Laurence Demarco has said softening this criteria to 50% is ‘detrimental’ and has refused to be the Scottish partner for the mark.
According to figures published by the Social Enterprises Coalition, there are 62,000 social enterprises in the UK contributing £24bn to the UK economy and employing around 800,000 people. Recent data from State of Social Enterprise Survey 2009, shows that despite the recession, social enterprises are twice as confident of future growth as typical small to medium-sized enterprises (48% of social enterprises as opposed to 24%). Additionally, since the economic downturn began, 56% have increased their turnover from the previous year. This is a considerably better performance than SMEs in the UK, where only 28% increased their turnover and 43% saw it go down.
