A social enterprise is defined as a business that has specific social objectives that serve its primary purpose. It is an organization that applies commercial strategies to maximize improvements in financial, social, and environmental well-being—this may include maximizing social impact alongside profits for co-owners. These enterprises seek to maximize profits while maximizing benefits to society and the environment. These businesses are driven by a social/environmental mission and reinvest profits into creating positive social change.
Social enterprises are businesses that trade to intentionally tackle social problems, improve communities, provide people access to employment and training, or help the environment. These can be structured as a for-profit or non-profit and may take the form of a co-operative, mutual organization, a disregarded entity, a social business, a benefit corporation, a community interest company, a company limited by guarantee, or a charity organization. Their profits are principally used to fund social programs. They can also take more conventional structures.
Social enterprises have both business goals and social goals. Social entrepreneurs work to solve critical social problems and address basic unmet needs through innovation. As a result, their social goals are embedded in their objective, which differentiates them from other organizations and corporations.
- A social enterprise’s main purpose is to promote, encourage, and make social change.
- Social enterprises are businesses created to further a social purpose in a financially sustainable way.
- Social enterprises can provide income generation opportunities that meet the basic needs of people who live in poverty.
A social enterprise is a business that aims to achieve a particular public or community mission (social, environmental, cultural, or economic), and reinvests the majority of its profits into achieving that mission. They are sustainable and earned income from sales is reinvested in their mission. They do not depend on philanthropy and can sustain themselves over the long term.
A social enterprise can be more sustainable than a nonprofit organization that may solely rely on grant money, donations, or federal programs alone. As a for-profit model, you control the curriculum and funding of the program. They are the businesses created to further a social purpose in a financially sustainable way. The incentives of the company are designed such that a greater impact directly correlates to a great profit. Social enterprises:
- Provide income generation opportunities that meet the basic needs of people who live in poverty.
- Are sustainable. They do not depend on philanthropy and can sustain themselves over the long term.
- Are scalable. Their models can be expanded or replicated to other communities to generate more impact.