What is Social Enterprise?

Find out more about the social enterprise business model

Social enterprise is a business model that puts the interests of people and planet before shareholder gain

The above short videos from Iridescent Ideas explain the social enterprise business model and why it is important.

There is no single legal definition of social enterprise.

In simple terms, a social enterprise can be defined as a business that ploughs its profits back into a strong social or environmental mission – i.e. trading to create benefits for people and planet.

The Social Enterprise World Forum has produced a useful guide to help people understand what social enterprise is, which highlights the defining characteristics.

The UK Government definition of social enterprise:

“Businesses with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than being driven by the need to maximise profit for shareholders and owners.”

The below accreditations demonstrate that a business is operating to genuine social enterprise principles

Aspiring Social Enterprise badge

Social Enterprise Mark badge

Social Enterprise Gold Mark

What industries do social enterprises operate in?

Social enterprises exist in almost every industry, from healthcare to energy, from retail to recycling, from employment to sport, and from housing to education. Whatever they do, they do it differently from other businesses, because they are centrally driven by a social and environmental mission, and they are focused on the needs of the communities they serve.

You can browse our directory of accredited social enterprises to see the broad range of goods and services available from genuine social enterprises.

How can you tell if a business is a social enterprise?

There are several key distinguishing features of genuine social enterprises, which were agreed by the social enterprise sector when the Social Enterprise Mark was first created:

  • Trading primarily for social/environmental purposes, as articulated in governing documents
  • Committed to reinvesting principal proportion of profits and income towards achieving social/environmental objectives, taking priority over maximising profits for shareholders
  • Earn at least 50% of income from trading
  • Demonstrating that social/environmental objectives are being achieved
  • Independently owned/controlled

These features form the qualification criteria for the Social Enterprise Mark– an independent, externally assessed guarantee that a business is operating as a genuine social enterprise, adhering to the above principles.

The Social Enterprise Mark is an independently assessed guarantee of a company’s commitment to trading for the benefit of people and planet.
It provides reassurance to consumers that a company is living up to its social/environmental claims.

Look for the Social Enterprise Mark as proof of an organisation’s commitment to creating benefits for people and planet