Social Enterprise: A Global Comparison

Foreword

Foreword Field organizations, corresponding to what we now call ‘‘social enterprises,’’ have existed since well before the mid-1990s when the term began to be increasingly used in both Western Europe and the United States. Indeed, the third sector, be it called the nonprofit sector or the social economy, has long witnessed entrepreneurial dynamics that resulted in innovative solutions for providing services or goods to persons or communities whose needs were met neither by private companies nor by public providers.∞ However, for reasons that vary from region to region as explained in this book, the concept of social enterprise is now the subject of a fast-growing interest, along with two closely related terms: ‘‘social entrepreneur ’’ and ‘‘social entrepreneurship.’’ Until recently, those three ‘‘se flags’’ were used more or less along the same lines: although this oversimplifies matters a little, one could say that social entrepreneurship was seen as the process through which social entrepreneurs created social enterprises. Since the early 2000s, however, a fast-growing literature has produced various definitions of and approaches to each of these three flags. A detailed analysis of these di√erent approaches is clearly beyond the scope of this foreword, but a few features may be pointed out in order to stress some current trends and help avoid too much confusion. The term ‘‘social entrepreneur’’ has been particularly emphasized by American foundations and organizations like Ashoka. Those entities identify and support in various ways individuals launching new activities dedicated to a social mission while behaving as true entrepreneurs in terms of dynamism, personal involvement, and innovative practices. Such a social entrepreneur brings about new ways of responding to social problems. Although this meaning of social entrepreneur is gaining some ground in Europe, the emphasis there has been much more often put on the collective nature of the social enterprise, as well as on its associative or cooperative form. The notion of ‘‘social entrepreneurship’’ was conceptualized in rather precise ways in the late 1990s.≤ These conceptualizations stressed the xii foreword social innovation processes undertaken by social entrepreneurs. However, the concept is increasingly being used in a very broad sense, as, for various authors, it now refers to a wide spectrum of initiatives, ranging from voluntary activism to corporate social responsibility (Nicholls, 2006). Between these two extremes, many categories can be identified: individual initiatives, nonprofit organizations launching new activities, public-private partnerships with a social aim, and so on. While scholars from business schools and consultants now tend to stress the ‘‘blurred boundaries’’ between institutional and legal forms as well as the ‘‘blended value creation’’ (profits alongside social value) that characterizes social entrepreneurship (Emerson, 2006), social science scholars underline the fact that social entrepreneurship most often takes place within the ‘‘third sector’’ (i.e., the private, not-for-profit sector). In any case, it seems clear today that of the three notions briefly described here, social entrepreneurship is the most encompassing. As to the concept of ‘‘social enterprise,’’ it took root in both the United States and Europe during the 1970s and 1980s. In the U.S., the nonprofit community began to set up and operate its own businesses as a way of creating job opportunities for the disadvantaged, the homeless, and other atrisk people. When an economic downturn in the late 1970s led to welfare retrenchment and cutbacks in federal funding, nonprofits began to expand commercial activities to fill the gap through market sales of goods or services not directly related to their missions (Crimmings & Kiel, 1983; Skloot, 1987). In Europe, new entrepreneurial dynamics clearly emerged within the third sector during the same period, though, as in the U.S., actual use of the term ‘‘social enterprise’’ was unusual. On the European scene, an emblematic step took place in Italy in the early 1990s, when the concept of social enterprise was promoted by a new journal entitled Impresa Sociale. The concept was introduced at the time in order to designate new types of initiatives for which the Italian parliament created the legal form ‘‘social cooperative,’’ a type of enterprise that has achieved amazing success (Borzaga & Santuari, 2001). Various other European countries have since passed new laws to promote social enterprises (Defourny & Nyssens, 2008). Going well beyond legal issues in its pioneering comparative studies of all eu countries, the emes≥ European Research Network stresses the positioning of European social enterprises ‘‘at the crossroads of market, public policies and civil society,’’ especially to underline the ‘‘hybridization’’ of their...