Promoting the social economy and social enterprises Making the best use of the ESF for 2014-2020

1. Promoting the social economy and social enterprisesMaking the best use of the ESF for 2014-2020 Gerhard Bräunling, Policy adviser

2. Overview • Issues at stake • EU policy messages • Barriers • Pillars of ESF support • Programming the ESF

3. Issues (1) Definition What is a social enterprise? • The General Regulation does not define social enterprise • Concepts and definitions vary widely across Europe • The Social Business Initiative and the PSCI refer to a definition of social enterprise that tries to take into account the diversity of economic structures, cultural traditions and legal frameworks across Europe: • Trading on the market • Main objective: achieve a social impact rather than a profit for owners or shareholders • Surpluses are mainly used to achieve social goals • Participative governance structures that involve workers, customers and stakeholders • accountable and transparent, innovative and entrepreneurial management

4. Issues (2) ScopeWhat are the economic activities of social enterprises? • Facilitate work integration • Provide/improve social and health care for disadvantaged people • Deliver social and care services of general interest • Produce services and products that meet collective needs, such as: • Organise and finance community development , • Produce and distribute healthy and affordable food, • Facilitate access to and deliver education and lifelong learning, • Nurture culture and arts, • Provide inclusive and sustainable facilities for tourism, recreation and well-being • Strengthen democracy and enable participation in the digital society, • provide public services such as community transport, utilities, • reduce emissions and waste, • use natural resources efficiently, or • promote fair trade

5. Issues (3) JustificationWhy promoting social economy and social enterprises? • Social entrepreneurs are innovators and drive social change: • They generate sustainable jobs, facilitate social and work integration, provide inclusive social services and improve the quality of social and health care; • They introduce efficient ways to reduce emissions and waste, and to use natural resources and energy more efficiently; • They focus on innovation and the participatory use of the internet • The investment priority on promoting social economy and social enterprises is strongly linked to EU2020 and social innovation, the Social Business Initiative, the Entrepreneurship 2020 Action Plan, and the Social Investment Strategy

6. EU policy messages (1) SBI Communication • EU policy framework that recognises the business model of social enterprises in a pluralist social market economy. • The definition of Social Enterprise tries to take account of the range of economic structures, cultural traditions and legal frameworks across the EU. • Social enterprise support needs to be embedded in a comprehensive ecosystem for social entrepreneurship and social innovation. This principle needs to be applied both at national and at EU level. • The Commission has asked the Member States and regions to step up their efforts to promote social enterprises.

7. EU policy messages (2) Key challenges to be addressed in ESF support actions • The crisis calls for reengineering Europe's economic and social fabric, and for reprogramming public policies and actions.  Social enterprises are drivers in social innovation. • The guiding principle for further developing the single market is the social market economy.  Social enterprises often lack capacity and opportunity to work across national borders. • Social enterprises face specific barriers in access to finance, markets and ressources.  Need a level playing field with all economic actors. • Cohesion policy instruments are to tackle economic, social and territorial disparities which the Single Market does not reduce by itself.  Many Social enterprises have a mission that falls into the ESF and ERDF scope of intervention. • The economic crisis is also a crisis ofvalues.  Social enterprises are the vanguard of responsible business.

8. Barriers to start, develop and scale social enterprises to be addressed by public policies • Lack of awareness and recognition of the social value which social enterprises generate; • Education and training system not developing the necessary mind-sets, skills and competences; • Inadequate support services, networks and infrastructures; • Lack of seed finance and support • An underdeveloped finance system - throughout the life cycle of a business.

9. Key objectives of support to Social Enterprise • speeding up and increasing the rate of creating sustainable social enterprises • direct support for capacity building of teams starting a social enterprise • address societal challenges through developing new business models and innovative solutions • Supporttransfer ofexpertise, cooperation and start-ups • stimulating the development of a supportive eco-system • delivery of high quality supply of business development and support services (education, training, networking, coaching, tendering etc.) • facilitating access to finance • Set up financial instruments

10. Strategic policy framework Social values & challenges Awareness, education Social Innovation Capacity building (pre-start up) Business development services Level playing field Capacity to assess needs & opportunities of social entrepreneurs Access to finance for enterprise consolidation & growth Access to markets Financial market regulations Learning & networking platforms; fora and pactsof stakeholders Objectives in line with the national employment strategy Good governance Design & implementation in partnership with stakeholders Simple administration rules & delivery procedures Synergetic actions of different depart. & levels of government Mechanisms for monitoring, impact measurem´t and evaluation

11. Social entrepreneurship supportProgramming the ESF • Priority setting • In partnership with stakeholders • Based on an assessment of challenges and needs (in the ex-ante evaluation) • Taking into account the proposals in the Commission Position Papers • Specific investment priority for EL, ES, HU, IT, PT • specific objective for AT, DE, LT, MT, PL, SK • Meeting the requirements for a concentration of resources • Documented in the partnership agreement

12. Social entrepreneurship supportProgramming the ESF • Options for programming • An integrated and startegic support package to promote social entrepreneurship • Schemes and actions that use social enterprises to deliver specific thematic objectives and investment priorities: • Promoting employment (access to employment for job-seekers and inactive people):  work integration SE • Investing in education, skills and LLL (Reducing early school-leaving): SE providing providing early childhood education and care • Promoting social inclusion and combating poverty (Enhancing access to affordable, sustainable and high-qualityservices)  SE providing health care and social services

13. Social entrepreneurship supportProgramming the ESF 3. Ex ante evaluation • Clear intervention logic: condition for good programming! • Strong recommendation: use a logical framework ! • The evaluator should examine: - What is the expected change? • How will outputs contribute to intended results? • Will the proposed actions effectively lead to these outputs? • What other factors could influence the expected results? • Would evidence suggest other approaches? • Are the planned forms of support the most effective? What is the rationale? (grants, repayable assistance and financial instruments and a combination: Art. 56) • Will the actions effectively meet the needs of specific territories or target groups?

14. Integrated Approach 1000 200 20 50 Stakeholders/ promoters 1 2 4 5 7 10 6 11 12 9 8 3 Social entrepreneurs 100,000 200 2,000 500 Act & implement Learn & improve Engage & empower Activate & nurture linkages Reach & encourage Create confidence & share risks

15. Good practice in promoting social economy and social entrepreneurship • Guiding principles (1) • An integrated strategic framework • combining support to social entrepreneurs, provision of business development support, access to financial instruments with awareness raising and recognition of the sector • Ensuring synergies between actions of different governmental departments and levels involved • Seamless support along the whole process of social enterprise creation, development and scaling-up • Support not restricted to specific legal forms of enterprises, nor selected sectors • Support requires linkages with civil society and community organisations

16. Good practice in promoting social economy and social entrepreneurship • Guiding principles (2) • Experimentation through regionally adapted pilot actions • Support is covering both creation of a new social enterprise and transformation of a pre-existing organisation • Support is conditional to meeting the double objectives of economic viability and generating social, environmental or community impact, and documenting how the social mission will/has been accomplished • Support to facilitate business links with mainstream companies