Social Entrepreneurship: A British perspective.

1. Social Entrepreneurship:A British perspective. Glen William Woodroffe LLB, MSt (Oxon), University Lecturer in Law, Barrister-at-law, Arbitrator

2. Biography • Lecturer in law, University of Central Lancashire (UCLan), Preston, England • Co-founder and director of Just Planet, an international human rights NGO • Founder and former managing director of CODIA CIC, a social enterprise based in England • Qualifications: Bachelor of law with Honours (LLB), Master of Studies in International Human Rights Law (University of Oxford), Barrister-at- law and Arbitrator

3. The ‘Third Sector’ • Term used to describe the range of organisations that are neither public or private sector. • Includes: registered charities, associations, self-help and community groups, social enterprises, mutuals and co-operatives. = Third Sector Organisations (TSOs) Source: National Audit Office

4. Third sector organisations • Take a number of different forms • Independent of government • Value driven – motivated by a desire to achieve social goals • Tend to reinvest surpluses generated in pursuit of their goals rather than distribute surplus as private profit Source: National Audit Office • However, some social enterprise models permit distribution of private profit

5. Economic benefits of TSOs • Employs nearly 800,000 people in the UK • Generates turnover of 37bn • Incorporates 20 million people who give up their time for others each year Source: The Guardian, 2013

6. Defining the term “social enterprise” The UK government defines a social enterprise as: • A business that helps people or communities • A business that has social, charitable or community-based objects Source: Gov.uk

7. Legal structures for social enterprises • Limited company • Charity or charitable incorporated organisation • Co-operative • Community interest company (CIC) • Sole trader or business partnership

8. Community interest companies (CICs) • CIC = aspecial type of limited company which exists for the benefit of the community • First established in 2005 • Not strictly ‘not for profit’ – can and do deliver returns to investors • But – primary purpose is one of community benefit rather than generating private profit

9. Special features of CICs • Primary purpose is one of community benefit rather than generating private profit • Asset lock” = ensures that assets of the CIC are used for the benefit of the community. Transfers only permitted to another ’asset locked’ body. • Returns to investors are permitted, but must be balanced and reasonable. A ‘dividend cap’ applies – limits the amount of dividend payable to shareholders. • Compliance ensured by the Regulator of Community Interest Companies • CIC Report = required to submit to Regulator an annual report detailing company’s activities undertaken and how these have benefited the community

10. CICs as a brand • All CICs must use the suffix ‘CIC’ or ‘Community Interest Company’ their company name • ‘CIC’ has legislative standing • Cannot be used solely for financial advantage of a group of people, for political purposes, or for the benefit of employees, directors or members of a single organisation

11. How many CICs? 10,000 community interest companies registered between 2005 – 2015 (Third Sector Magazine) But CICs are just one type of social enterprise structure in the UK. A CIC can exist as one of a portfolio of legal structures which operate in a mutual partnership of business and social value. Let’s look at one model that has created just such an ecosystem – the business and charity called ‘Recycling Lives’.

12. Social enterprise success • “Recycling Lives Limited” - Preston, Lancashire • Established 2008 – aim to rehabilitate homeless people and support them into full-time employment • Business model: • Recycling, total waste management, recruitment, training and business incubation services (4 subsidiary companies) • Gross profit: £9,007,000 (2017) – up 21% from 2016 • Net assets: £8,827,000 (2017)

13. Recycling Lives Ltd – social value • Residential programme • Stable accommodation for men facing homelessness, with a 6 Stage Programme for residents to regain their independence • Created £300,000 of social value last year • HMP Academies • Operational in 10 prisons creating work for 200 men and women • Supports offenders serving prison sentences by running workshops which enable men and women to undertake recycling, welding and fabrication work • Food Redistribution • Recycling Lives Food Distribution Centre • 1.5 million meals distributed since 2015 / feeds 5,000 people a week / 400 tonnes of food diverted from landfill / £4.4 million in social value since 2015

14. Recycling Lives Ltd – factors of success • Visionary leadership –social value an objective from the start • Mutual partnerships of business and charity • Socially conscious brand – attractive to consumers and government • Commitment to high quality services from the outset • Employee motivation – a business which exists to care for others • Innovative development and steady expansion • 2010 – Bought their first producer compliance scheme, Advantage Waste Brokers • 2010 – Opened their main Recycling Park • 2011 – Building England’s first ever Flat Panel Display TV processing centre • 2012 – Bought their skip company and achieved 99.9% recycling rate • 2012 – 2017 – Launch of their social value programmes • 2017 – Beginning of nationwide expansion of waste management business, taking over 5 sites in the United Kingdom

15. Recycling Lives Ltd – Steven T Jackson OBE DL (founder) "Our purpose, has always been to demonstrate that a well thought out partnership comprising business and charity, working for mutual benefit, can produce quantifiable and sustainable social benefits to communities. Recycling Lives is committed to creating social value that is equal to, or greater than, 10% of our annual sales; something that we are pleased to publish each year in our dedicated Social Value Report.” "The virtuous circle of Recycling Lives ensures that employee strengths are maximised and Group passion for social value and good business acumen is shared by everyone. Employees of the business are not only driven for commercial growth, they also enjoy personal fulfilment that their efforts help excluded people to thrive. While employees of the Recycling Lives Charity and Social Enterprise are equally proud to be part of an organisation that can concentrate 100% of its efforts in caring for people; rather than being preoccupied with fundraising and sustainability.”