A one-day seminar hosted by Social Business International in association with:
- Bates Wells & Braithwaite
- University of Northampton
- Unity Trust Bank

Click here to download our pdf brochure for this event.

This one-day seminar focuses on how local Authorities, the NHS, Universities and other public bodies can be bold and innovative in their procurement decisions to construct new forms of service delivery that achieve wider public benefit. Social enterprises can play a vital role in realising this vision.

The Public Services (Social Value Act) 2012 puts new obligations on procurers and the Localism Act 2011 encourages new community led service delivery. Nevertheless, all public bodies have to comply with Competition Law and the Procurement and State Aid rules laid down by the European Commission, and these can appear daunting and restrictive. To do nothing or doing too much could lead to costly legal action.

The aim of this seminar is to provide an expert overview of what is possible within the EU rules and explore how public bodies can build business relationships with social enterprises. The seminar programme includes input from specialists and technical experts in the field as well as case study examples of what can be achieved when procuring from social enterprises.

To download our full programme for this event, with itinerary or further information on our speakers, click here. Or book your place using the form below.

The audience of 60 high level representatives from Finnish national and local government, innovation funders and social enterprises heard Greg Clark explain why the UK Government strongly supports social enterprise. He talked about some of the measures currently being adopted to encourage more social enterprise solutions through new legislation that gives communities the “right to challenge” the status quo in the way local services are provided and bid to run them. He also outlined the Government’s support for the creation of Big Society Capital, the new financial institution that will increase the supply of finance to social enterprises in the UK.

The audience also learned about the radical approach Surrey County Council has taken to de-commissioning their services for young people and how they have re-commissioned them using an outcomes-based approach.  In the old days they produced heavy, 400 page tomes specifying everything down to the size and height of the signs outside their youth centres. Now they focus on getting the best outcomes for young people into employment, training or education encouraging a diverse range of providers to come up with the best ways of doing so.

Participants also heard how SCCT span out from a local authority and grew from a small business caring for 62 people with 85 staff to one that cares for over 800 people with 600 staff and from £1M to £15M turnover. In particular Geoff Walker explained how using an innovative and empowering business model could cut costs and inefficiency but retain good staff pay and conditions and above improve the quality of the care they provide, offering ‘better for less’.

Despite the language and cultural differences it was clear that the UK and Finland share many common features. Many of our challenges are the same:  an ageing population, increased needs for services but limited resources from tax-payers to fund them. Both countries need new solutions and it was clear from the discussions in the seminar that to foster innovation in service delivery there are two sides to the coin.  Commissioners need to frame things in a way that allows providers like Geoff Walker to come up with solutions that have impact. There is also a need for new models for service provision and that means having new kinds of business, such as SCCT that compete in a diverse market place. Indeed, the issue of market development and management was seen as the key to unlocking the potential for innovation.

The European Commission has started to recognise the need for more plurality of business form within the Single Market Act and has specifically focused on social enterprise in the Social Business Initiative. Emmanuel Vallens of DG Markt highlighted the measures being developed by the Commission which were announced last year and in particular the proposals to remove barriers to social enterprises in the procurement and state aid regulations and to improve access to finance.

There was a lively panel discussion and debate from the floor and a lot of interest in how the nascent social enterprise sector in Finland could be supported and developed. There are some big barriers in Finland.  Most of the attention of Finnish local authorities is on mergers in a move for them to be economically viable, rather than on how to commission services differently.

However, there are developments in places like Oulu, Tampere and Espoo and there is interest elsewhere. Awareness is slowly being raised about social entrepreneurship and a Finnish social enterprise mark was launched at the end of last year.

What is really needed is a more enabling environment in Finland (and in other European countries). Some of the UK practice and the Social Business Initiative from the European Commission are instructive about areas to focus on. This can be categorised as what I call the three M’s – markets, money and models. That is how to:

• develop and manage public service markets

• ensure access to the right kind of investment

• promote and understand a range of social business models

The challenge is, whether national Governments like the Finnish one will act on the opportunity they have to support local authorities and social enterprises in providing these much needed dynamic solutions?

The seminar will offer the chance for high-level stakeholders to explore approaches to innovative forms of commissioning and delivery models that are being used in the UK and Finland.

It will combine discussions about policy and practice with a mix of presentations and debates involving speakers from national and local government, expert practitioners and social enterprise leaders.

The aim is to identify areas where there are common interests and where mutual international learning could be deepened; and in particular to identify if there are policies and practices that can be adapted for use in the participating countries. The outcomes of the discussions and debate will prepare the ground for further work.

On a wider level, we hope the seminar will contribute to deepening dialogue in the context of British and Nordic co-operation and feed into the rapidly moving agenda on social business being developed by the European Commission.

The guest speakers include:

Rt. Hon. Greg Clark, MP, the Birtish Minister for De-centralisation and Cities, who is leading on the new ‘Right to Challenge’ which gives voluntary organisations and staff-led mutuals the opportunity to bid to run local services. The UK Government is promoting social enterprise as a way to innovate and improve the delivery of public services.

Permanent Secretary of the Ministry of Social Affairs and Health, Kari Välimäki, who has served the Ministry in various positions for almost three decades.  He has been the head of the staff for five years.  The last strategic plan, Socially Sustainable Finland 2020, was drafted under his guidance.

Emmanuel Vallens, the Policy Co-ordinator in DG Markt’s Unit for Single Market Policy and Relations with the Council of the European Commission. The unit is leading a major EU policy initiative to promote social enterprise, including social investment, procurement and state aid rules.

Assistant Director for Young People at Surrey County Council, Garath Symonds, is pioneering a radical de-commissioning of youth services to create a new, intergrated and outcomes-based provision that meets the needs for transforming young people’s lives in Surrey.

CEO of Sandwell Community Caring Trust, Geoff Walker, is a social worker by profession but has become one of the most entrepreneurial leaders in the UK social enterprise movement. SCCT provides innovative care services under contract for local authorities.

The seminar will take place on January 16th at the Residence of Her Majesty’s Ambassador to Finland and attendance is strictly by invitation only.

Partners and sponsors:

This event has been kindly supported by SITRA, STKL (SOSTE from 1.1.12) and the British Council.

Media contacts and further information:

Media interest in Minister Rt. Hon. Greg Clark, MP, to Irina von Witte, the Press Officer of the Embassy, irina.vonwitte@fco.gov.uk, +358 (0)9 2286 5100

All other queries to Anne Bland, CEO of SBI, anne.bland@socialbusinessint.com, +358 (0)40-8525656

At the launch of the Social Business Initiative on the 18^th of November[1] The European Commission made a remarkably strong political commitment to social enterprise. In the words of Commission President José Manual Barroso[2]:

-       The Commission’s guiding objective is to create the right environment for social businesses in all their diversity of legal forms and status across our Member States. To foster their growth and development across Europe. To un-tap some of the massive potential that they represent for Europe’s future prosperity.

During the high level event over 1100 delegates and live webcast audience heard Commissioners, Ministers from Poland, UK, Denmark and Tunisia, MEPs and very senior Commission officials one after another giving their support to social enterprise. Social businesses now have the possibility of being included in many future policies and programmes. Commitments were made to unblock some of the barriers created by EU procurement rules and state aid regulations. Already nearly €100m has been allocated for social investment, and there is the possibility of very considerable further funding across a range of programmes such as the Structural Funds from 2014.

This political commitment has opened up a relatively short window of opportunity. The question that strikes me right now is: what is going to happen over the next few months to ensure that the new polices and programmes coming out of the Commission will actually work?

Over the last 20 years I have seen many programmes come and go in the UK and other countries as diverse as Spain and Finland. I have been involved in some brilliant and impactful European projects, but I have also seen European taxpayers’ money wasted. Opportunities have been lost and expensive “white elephants ” created that look good on paper but don’t work in practice.

We should make sure this opportunity is now fully taken, and that in an era of scarce public resources, new measures are targeted at things that will be successful. The new initiative must make a difference to the thousands of social entrepreneurs on the ground in Europe who need access to finance, appropriate support and the possibility to enter and trade successfully in public service markets.

Commissioners Michel Barnier (DG Markt) and László Andor (DG Employment)  both talked about creating an ecosystem to support social enterprise. I share their vision and think this is vitally important. However, I believe there is still very limited understanding of what this really means in practice. The task of the next year is to be clear about how this ecosystem will work at EU level, and also nationally, regionally and locally in different member states.

As a minimum, this ecosystem will require:

• Promoting a deeper understanding of the social enterprise concept in a mixed and more resilient European economy; one that encourages plurality of business forms.
• Building and sharing knowledge of successful social enterprise business models.
• Addressing market failures in the supply of finance by linking funds, financial instruments and tailored support to create a viable deal flow from sustainable social enterprises.
• Making more public support possible for social businesses through reform of state aid and procurement rules.
• Developing appropriate ways of measuring impact.

This is no small task. To be successful it requires co-operation between the Commission, member states and the emerging social enterprise movement itself. Building the system should draw on experience from where social enterprise has been promoted well and badly in the past. Proper analysis and reflection should guide the new policies and programmes.

Those with experience across the EU, and beyond, should mobilise to pool their knowledge to support the Commission and their partners in national and local government and make this ecosystem a reality.

The clock is ticking. Let’s get to it!

[2] http://ec.europa.eu/commission_2010-2014/president/news/speeches-statements/2011/11/20111118_speeches_2_en.htm

Recipe for success

Take one social enterprise, one that’s making all sorts of people happy – its employees, its customers, its service users, its funders, its supporters – sprinkle some social innovation fairy dust and watch it grow. Multiply the business by two, four, eight, sixteen new businesses…and hey presto, you have a whole lot more social impact across a wider geographical area, more jobs and lower operating costs because of a shared brand and joint purchasing power. Happiness multiplied! (Happiness = wellbeing = healthy communities = better world). What’s not to love?

Read the recipe carefully

Social franchising (or replicating / licensing depending on the contractual detail) is definitely one way to grow the social enterprise movement. With so many exemplar social enterprises achieving lasting impact in their communities, it seems like a logical business strategy, and one that the likes of the School for Social Entrepreneurs (UK), BARKA (Poland / UK), Le MAT Europe (France / Italy) and FIETSenWERK (Belgium) have acted upon with great success.

But why aren’t more social enterprises replicating? There are plenty of successful social enterprises out there. Research in the UK even shows that they’re more likely to survive than mainstream businesses in the current economic climate (Fightback Britain, Social Enterprise UK 2011).

Reading between the lines at the recent European Social Franchising Conference (London, 18 Oct 2011) a number of key success factors must not be over-looked, not least the fact that social enterprises need to carefully consider whether this strategy for growth is the right one for them. You see, social franchising brings with it a few challenges: how to maintain quality and brand integrity, how to keep products and services focused on the local market, how to develop a successful business relationship based on reciprocal support. Not by any means insurmountable, but with only 24 social franchises across Europe, there is something quite significant that warrants further consideration: are there so few because it’s difficult, or are there so few because in reality the impact is not as great as the equation (more = better) suggests and other routes to growth offer more immediate benefits?

I don’t know the answer to that question, but as I’m a great supporter of using the social franchise model, I hope that the difficulty factor is the reason. You can do something about difficulty. You can learn, share, collaborate, replicate…the message is most definitely in the method!

Regarding impact, perhaps there is a need for some quantitative and qualitative research comparing social franchising with other growth strategies (mergers, consortia, joint ventures). I suspect though, rather ironically, that the impact of social franchising is still to manifest itself. Growth using this strategy has not, in the short term, brought with it a significant increase in employment; there are still fewer than 7,000 employees of social franchises across Europe.

But what do we know? Growth of social enterprises must equal greater social impact. Implicitly a good thing. However, if social enterprises want to grow, it is the economics of growth that deserves the most attention. Franchising comes with a literal price tag; without doubt the core business model has to be financially robust otherwise the franchisor risks everything (italicized for dramatic effect) and the franchisee risks losing local investment, the license fee and the opportunity to resolve local problems at speed. Explicitly a bad thing.

Luckily for anyone wanting to explore this route there are now resources out there that examine the strategy, decision-making process and step-by-step approach to social franchising:

European Social Franchising Network

ESFN Research

Social Enterprise UK (Social Franchising Support)

Kirsten van den Hout is a SBi Associate and a guest blogger.

The European Commission’s Communication on Social Business, which will set out the broad policies it is developing towards social enterprise, will be published next week. In advance of this, social enterprise has already been identified as an investment priority in the new structural funds and around 90 million euros have been earmarked for a new social investment instrument to support debt and equity investments. Support for social entrepreneurship has also been included in the new EU programme for Social Change and Innovation. Tucked away in the small print of the rules governing this programme is the first ever EU definition of social enterprise; one which is likely to be used for the next seven years.

The Commission’s definition is good and very compatible with the approach developed in the UK:

‘Social enterprise’ means an enterprise whose primary objective is to achieve social impact rather than generate profit for owners and stakeholders. It operates in the market through the production of goods and services in an entrepreneurial and innovative way, and uses surpluses mainly to achieve social goals. It is managed in an accountable and transparent way, in particular by involving workers, customers and stakeholders affected by its business activity.

President Barroso is hosting a major event to discuss the Social Business Initiative in Brussels on 18^th November with EU Commissioners, Prime Ministers from several member states, MPs and MEPs. There will be high level endorsement for social enterprise and I am sure, a lot of warm words. The question is, how far can the Initiative really support the growth of social businesses on the ground?

The measures already announced are positive. However, the bigger and more sustainable step would be to recognise the unique role social enterprise plays in the economy and society. The people who create social enterprises do so for public benefit, not to maximise their private profit.

The benefits of economic growth through free market competition across international borders don’t reach EU citizens who have lost their jobs or are socially excluded. Indeed, EU competition policy is often at odds with EU social policy. Competition rules that were designed in the last century for the motor industry are now being assiduously applied to areas, like health and care, where different approaches should be used. The application of the rules on state aid and procurement kill social innovation and are holding back the reform of public services. They are also a block on tackling social exclusion and supporting the creation of employment.

European regulations should clearly recognise the public benefit provided by social enterprises and make exemptions from competition rules in the early stages of their development (for example for public sector spin-outs) and in certain areas such as investment in local community economic development. This would lead to better solutions to some of the challenges facing us which require a shift to a new 21^st Century paradigm. This doesn’t mean social enterprise should be exempt from competition per se, afterall, the whole idea is that they are businesses that trade in markets.

However, does the left hand know what the right one does? Social enterprises need support to get going. Public service markets and government investment policies should be regulated in a way that matches policy intentions regarding public benefit. Later this year DG Markt will publish its proposals for reform of the procurement directive. It should use this as an opportunity to back social business.

The seminar entitled “High level internal workshop on building the ecosystem for social business in Europe”. It was organised to help the Commission to prepare for a Communication on Social Business, which is due to be launched this autumn.  Working with over 30 external experts from the across the EU and another 40 senior policy makers from different parts of the Commission, we spent an intensive 48 hours helping to put some flesh on the bones of the proposal to support social business, which has been included in the Single Market Act.

For those of us interested in the growth of social business, in all its forms (and by that I include social enterprises trading as charities, co-operatives, social companies and a variety of hybrid models), I can’t stress enough what an important opportunity this is.  Michel Barnier is convinced that the only way for Europe to be successful economically is for there “to be a social market economy, where financial services are at the service of the real economy, and that the real economy is at the service of human progress”.  Social business has been indentified as a key lever in renewing the single market and ensuring social cohesion. Europe needs the new solutions created by social entrepreneurs if we are to meet the challenges that face us in creating an economic model that also fosters social cohesion.

So what does this mean? It means that the Commission is looking to give official recognition to the role of social business and is exploring how it can use its policies, programmes and influence to promote it.  During the seminar we had some very considered discussions about what is meant by social business  (with some consensus on understanding it through a set of defining characteristics rather than by legal form). We also explored what kind of actions or changes to EU rules could be made to boost the growth of social enterprise. Topics covered changes to procurement law and state aid, taxation, social investment (including the role of micro finance), increasing visibility, education and capacity building.

And what comes next? Over the coming months DG Market will prepare a communication setting out policy on social business which will be presented to the full Commission in September and publically launched in November.

I think we could see some big steps forward, so watch this space!

It shows that in all three countries, the growth of public service co-operatives has been closely linked to enabling legal and fiscal frameworks, with sector-led support structures that are able to provide specialist advice and share learning.

Key findings:

-            In Italy, there are over 7,000 co-operatives that provide social care, health and employment services, which is arguably the most extensive and successful programme of mutualisation anywhere in the world. Their success comes from creating a clearly defined legal structure for ‘social co-operatives.’

-            In Spain, there are around 550 co-operative schools, and their success reflects links with a wider, successful co-operative business sector but also benefits from long-term thinking from the state, particularly clear legislation and favourable taxation.

-            In Sweden, 1,200 childcare co-operatives provide pre-school care for around 30,000 children. The state has helped to grow childcare co-operatives by investing in a national framework of co-operative business advice.

Copies can be downloaded from  www.uk.coop/serious

Right now, I believe there is a significant window of opportunity to influence the social business agenda and make a difference in a way this directly affects the UK and spread the success of our movement across the European Union.

Two urgent matters. The European Commission is consulting on changing the procurement directive , which affects every social enterprise that trades in public sector markets (the deadline is 18 April). Brussels is also planning to introduce a social business initiative , drawing on ideas from the UK (in particular social investment) and they could put social enterprise at the heart of a new social innovation agenda. The consequences of economic crisis that followed the banking crash means it is no longer business as usual, creating employment and tackling poverty are higher up the agenda. In addition, there are challenges of Europe’s ageing population and climate change. The last time the social dimension was so pronounced at EU level must have been almost 20 years ago.

There are three very good reasons for the UK social enterprise movement to get involved:

• We should have influence over the rules and regulations that affect us.

• We should influence the billions of euros that the EU spends to get more support for the growth of social enterprise solutions.

• We should work with others to share the knowledge about our business models and to learn new things.

I have just spent two days in Brussels meeting officials from the commission who have responsibility for the single market, enterprise and employment, and it was very clear that we about to miss the train. Right now, they are deciding the broad allocation of budgets, new programme priorities for the structural funds, and the framework programme. Don’t let your eyes glaze over. If we can make a successful interjection at this stage, there could be a more enabling procurement regime, European funds for social investment and social innovation and new measures to support social enterprises that create jobs and opportunity.

The challenge is that there appears to be no common voice that represents social enterprise in its many faceted forms in Brussels. Indeed there is considerable fragmentation between those representing the traditional social economy (co-operatives, mutuals, associations and foundations) and new groupings of social entrepreneurs and wider civil society organisations that engage in trading.

One of the reasons that many people have remarked that the UK is leading the way on social enterprise is that we overcame that problem many years ago through our joint working and having one voice. Commissioner Michel Barnier’s social business initiative is drawing on our experience. The Young Foundation has been very effectively championing social innovation. The call to promote social innovation has been taken up by the Euclid network of civil society leaders, but we need much greater critical mass and co-operation to be effective in making major change.

Social enterprise needs a strong European voice. It feels to me that the time is right. Is this an invitation to all those in the UK with a vision for social enterprise to work for a new alliance to shape the next steps to promote social enterprise in Europe? Yes I think it is.

Jonathan and Anne Bland of Social Business International have been joined by Baroness Glenys Thornton and Kirsten van den Hout to promote social enterprise in Europe and beyond. The new team will work with public bodies, social enterprises and civil society organisations and the private sector to develop social enterprise solutions.

Jonathan Bland said:

“Our experience shows we need to be working much more closely with colleagues in other countries. We should learn from each other and build common understanding. Expanding the team will allow us to develop some exciting new projects. I am delighted that Glenys and Kirsten have joined us as associates”

Glenys Thornton said:

“I am very pleased to be working with Jonathan again. There is so much to do internationally, not least working to shape the programmes and policies of the European Commission which affect all of us in Europe”

About Social Business International

Social Business International (SBI) specialises in knowledge transfer and innovation in the field of social enterprise.

SBI designs programmes and informs policy frameworks to support the growth of social enterprise. Clients include governments, public authorities, civil society organisations and private companies.

SBI has recently delivered a major knowledge transfer programme working with the Finnish Ministry of Employment and the Economy, involving research, publications and series of study visits to the UK.  This has led to a commitment to include the development of social enterprise in the programme of the next Finnish Government starting in May 2011. SBI is now widening its focus to other countries and to engage with the European Commission.

For further information please contact: Jonathan Bland, Managing Director, Social Business International Ltd, info@socialbusiness.com,
tel: 07848007986. www.socialbusinessint.com