FAQ: “Can I Become a Social Enterprise?”

After telling someone about our transition to becoming a non profit social enterprise their first question was “Can I become a social enterprise?” if your business suits the CIC  frame structure and your intentions good then why not become a social enterprise….For our business model it was only a matter of time until

 we became a social enterprise but it may not fit every business type so do your homework first and make sure it’s the right decision!

What is the difference between a social enterprise and ethical business?

The two are distinct ways of doing business. A social enterprise’s primary purpose is its social and/or environmental mission – it tries to maximise the amount of social good it creates balanced against its financial goals. An ethical business however, attempts to minimise its negative impact on society or the environment. Can I register to become a social enterprise? There is no single regulator for social enterprises.  Unlike charities, social enterprises take a range of legal forms so they are regulated by a range of different bodies:

  • Community Interest Companies are regulated by  Companies house and the Community Interest Company Regulator
  • Standard companies limited by share and guarantee are regulated by Companies House
  • Industrial and Provident Societies are currently regulated by the FSA – though this is likely to change shortly
  • Social enterprises with charitable status are regulated by the Charity Commission

In the end, being a social enterprise is about adopting a set of operational principles. These include:

  • Having a clear social and/or environmental mission (set out in your governing documents)
  • Generating the majority of your income through trade
  • Reinvesting the majority of your profits to further the social mission

This is regardless of what form the organisation takes.  So if you have these in place – you are acting as a social enterprise. While there is no social enterprise regulator there is an accreditation mark and further details can be found here:  www.socialenterprisemark.org.uk

                                                   Serious about becoming an SE?

We’re running a course on how to become and run a successful Social Enterprise so if you are serious about starting up or growing your social enterprise knowledge then get on this course ASAP!

To book your place or request more information email us at:

info@businesscommunity.org.uk

or call 0121 345 0620

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About Business and Community Link

Business and Community Link is here to offer the best in business support. We are a small but friendly team of business owners who understand the difficulties that you face because we have been there! Our main aim is to encourage, support and offer assistance to those running or thinking of running micro and small businesses. Our vision is to be the first point of call for businesses across the country when they are looking to get the help and support they need to make a success of their organisations. We will provide training, mentorship and affordable solutions so that all businesses no matter what their size or turnover, can have a fighting chance of survival.
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