About social entrepreneurship

Why social economy and social entrepreneurship?

“Whenever the society gets stuck it needs an entrepreneur who will see an opportunity, who will turn their vision into a realistic idea, and then into reality, and finally into a new pattern throughout society… We need such social entrepreneurship… That is the job of social entrepreneurs.”

Bill Drayton, founder of the first
global organization for social
entrepreneurship “Ashoka”

Social entrepreneurship – meaning and characteristics

Social entrepreneurship represents a relatively new form of business which can relate to all legal forms business entities – collectives, citizen’s association, foundations, companies and groups for professional rehabilitation and employment of individuals with disabilities, business incubators and dependant social/spin-off companies, development agencies, limited liability companies and others.

Social entrepreneurship means doing business with the idea that by investing profits made by selling a product or service you fulfill a clear social mission. That means that the earned funds do not serve to increase profits of an individual, but rather be invested for other purposes such as employing people who have a harder time finding work, social and medical services, education, preservation of the environment, cultural activities in the communities, etc. Social entrepreneurship deals with identifying  and dealing with social issues such as seclusion, poverty, unemployment and others through using innovative methods and strategies.

In Europe, this form of business is known as “social economy”, whereas in Serbia it is known as “social entrepreneurship”, therefore in this presentation we will use this term in order to avoid any language confusion. In order for any legal entity to do business following the principles of social entrepreneurship, the European Committee has defined a few criteria (“Social Business Initiative“, 2011):

  • must have work in the field of economy;
  • must have an explicit and primary social goal;
  • must have limitations in regard to managing profits or property;
  • must have inclusive governing, and
  • must be independent

Social economy can be considered as foundation for the European Project of Integration. Through aiding the development of economy founded on solidarity, social economy helps member countries  achieve several  key goals of the European Union such as creating and maintaining work positions, social inclusion, social innovation, rural and regional development, protection and preservation of environment, and others. Even though it is not simple to define and classify this form of doing business mainly due to different understanding and status of social entrepreneurship in different countries. It is considered that in European Union there are around 2 million legal entities with about  14.5 million employees (6.5% of the working population)who  do business following the principles of social economy.

What is the situation like here?

In Serbia the legal and methodological framework for social development hasn’t been developed. The law which would regulate this has 4 times been put in the procedure for adoption in the Parliament of the Republic of Serbia but was then withdrawn . The only relevant  research was done in 2012 and showed some interesting data:

In Serbia there are 1.196 legal entities that do business following the principles of social entrepreneurship. Cooperatives make up for 65.6%, associations of citizens 23.7%, enterprises for employment of persons with disabilities 3.8%, development agencies 2.7%. Everyone else (foundations, business incubators, dependant/spin-off enterprises and other) made up for 4.3% of the total number of social entrepreneurs.

  • In 2012, social economy  made a gross profit of 6.819.200 million dinars, which made up for 0.2% GDP of the Republic of Serbia in that year.
  • In 2012, there were 10.326 employees within social economy which made up 0.6% of all employees. Alongside these, which were paid for their work, a further 23.826 volunteers were assigned.
  • Social enterprises in Serbia make a profit from performing various services and work. When it comes to associations and foundations the three most common areas of business are: education and training (31.00%), tourism and catering (18%), and culture and art (11.8%).

All of the aforementioned goes to say that this form of business here is still new, and that the community hasn’t recognized the specifics and benefits of social economy for overcoming the effects of the economy crisis and overall social development.

What is social entrepreneurship? Watch a short promotion video which was made made by the network of social economy of Serbia (SENS)

Publications regarding social entrepreneurship in Serbian language

Economic influence of social enterprises in Serbia, Republic institute for Statistics, Belgrade, 2014 http://webrzs.stat.gov.rs/WebSite/repository/documents/00/01/40/87/Socijalna_preduzeca_srpski.pdfhttp://webrzs.stat.gov.rs/WebSite/repository/documents/00/01/40/87/Socijalna_preduzeca_srpski.pdf

Brochure for social entrepreneurship for the young, Coalition for the development of social entrepreneurship, European movement in Serbia, Belgrade, 2013

Guide for setting up social enterprises – business for man, Smark collective, Belgrade, 2013

Encouraging social entrepreneurship and setting up social enterprises in the Republic  of Serbia, OECD report for the Republic  of Serbia, Team for social inclusion and reduction of poverty (SIRPU) in the government of the Republic  of Serbia, Belgrade, 2012

Recommendations for the support of the development of the capacities of social enterprises in Serbia, European movement in Serbia, Belgrade, 2011

Social entrepreneurship: models, comparative practices and legal framework for social entrepreneurship in Serbia, Group 484, Belgrade, 2011

Social enterprises and the role of alternative economy in processes of European integrations. European movement in Serbia, Belgrade, 2008

Mapping of social enterprises in Serbia, SeCons, Belgrade, 2008