Each month Jane shares her views on our business theme. This month Jane tells us why we are all social entrepreneurs..
It is estimated that the third sector will boom over the coming years. The Government define this as all organisations that do not fit into the public or private sector ie charities, foundations, voluntary communities and social enterprises. However, the definition of a social enterprise is not quite so black and white.
Having just recently established a Community Interest Company (CIC) called GIRLS OUT LOUD. An organisation dedicated to raising the aspirations of young girls in the UK between the age of 13 -18 my knowledge of the third sector and the hoops and red tape just got bigger!
If the definition of social enterprise is any organisation that has a passion and social purpose this applies to a whole raft of businesses, many with a commercial objective, indeed, my core business The Well Heeled Divas is one such business – our premise is to inspire and empower women to step up to entrepreneurship, leadership and wealth contribution and we already commit to donating 10% of all our profits to female centric charities. But we are not a social enterprise by government standards. Confused yet?
The fundamental difference between a social enterprise and a limited company relate to dividend and interest cap and asset lock. A community interest company like Girls Out Loud is limited by shares but has an interest and dividend cap at 10% and a commitment that all the assets of the business are donated to the community it is set up to serve. From a purist, entrepreneurial position, not a particularly attractive proposition I hear you say? So why bother?
My view is that social enterprise ventures have tended to grow from community/voluntary projects where commercial savvy is limited so converting to a more business orientated structure encourages more sustainability and attracts business input, however, as an entrepreneur, in my opinion, the only benefit in becoming a CIC is to be in a better position to attract funding. The hard facts…. If you are looking to access Government funding the CIC badge is a huge advantage. Do I sound cynical?
Don’t get me wrong here, I am a huge supporter of social enterprise. I fully subscribe to this and the philosophy of wealth contribution, if fact I champion it, I just fail to see how narrowing our definition supports the global vision of entrepreneurs using their skills and profits to make the world a better place.
In the era of corporate responsibility, ethical trading and making a difference, if you are in business today, you are more than likely contributing to your local, if not, global community in some way. It is pretty impossible not to and most entrepreneurs are motivated by the need to drive change, make a difference, create a legacy and contribution. The growth in programmes like The Secret Millionaire continue to highlight that the benefits of giving far outweigh stockpiling!
Although, I sometimes wonder about the super rich – The Sunday Times Rich List published last week, highlighted once again how the rich simply get richer even in a struggling economy. Lakshmi Mittal, the steel baron tops the list in the UK for the 6th year running and his net worth is up by 108% to 24.24 billion, yes BILLION! In fact, most of the top ten have seen their value increase and we now have 53 billionaires in the UK a rise of 10 this year alone. Mittal leads a very extravagant lifelstyle, living in the most expensive house in Europe, worth something like £80 million. He spent around £15 million on his daughter’s wedding a few years ago – My head cannot compute these figures!! Although, I accept, on an intellectual level, he earned it and therefore he has a right to spend it on whatever he desires, but my heart sings a very different tune. I cannot see where his social entrepreneurial conscious is? If anyone finds it please let me know, maybe he is funding a third world country somewhere and keeping it a secret!
I look forward to sharing more about Girls Out Loud CIC in the next edition and I know there are some amazing women role models reading this and believe me – our young girls need you to step up and get involved so watch this space!