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An assessment of community-based social enterprises in three European countries.

Authors:

Abstract

In October 2016, Power to Change commissioned a team from the University of Westminster, Delft University of Technology and Stockholm University to carry out a comparative study of community-based social enterprise (CBSE) in England, the Netherlands and Sweden. National policy was reviewed and three case studies were selected from each country, in order to provide an evidence base for making comparisons and drawing out more general conclusions about the development of the sector.
Professor Nick Bailey, Dr. Reinout Kleinhans
and Dr. Jessica Lindbergh
February 2018
An assessment of community-based social
enterprises in three European countries
Research Institute Report No. 12
Contents
Executive summary 2
Introduction 8
1. A comparison of government policy relating
to community-based social enterprise 13
1.1 Introduction to the project 13
1.2 Definitions 13
1.3 The Netherlands 14
1.4 Sweden 15
1.5 England and the United Kingdom 15
1.6 Are there national policies? 16
1.7 Distribution 18
1.8 National support organisations 18
1.9 Support and funding at the local level 21
1.10 Local authority support for CBSEs 22
1.11 Conclusions 23
2. Key characteristics and findings from the case studies 25
2.1 England 25
2.2 The Netherlands 30
2.3 Sweden 36
3. Discussion and conclusions 41
3.1 Origins and development 41
3.2 Defining objectives 43
3.3 Organisation and management 43
3.4 Business model and funding 44
3.5 Context 45
3.6 Accountability and representation 46
3.7 Leadership 47
3.8 Prospects for growth 48
3.9 Conclusion 48
Bibliography 51
Appendix 1: Methodology 55
Power to Change Research Institute Report No. 12
An assessment of community-based social enterprises in three European countries
About the authors
Professor Nick Bailey, University of Westminster, UK
Nick Bailey is Professor of Urban Regeneration at the Faculty of Architecture and
the Built Environment, University of Westminster. Research in the Faculty covers the
full spectrum of the social, economic, governance and organisational aspects of the
built environment. A particular specialism is the evaluation of public policies and
their impact at the local level and the contribution public engagement can make
to improving delivery.
Dr. Reinout Kleinhans, Delft University of Technology Netherlands
Dr. Reinout Kleinhans is Associate Professor of Urban Regeneration at the Faculty
of Architecture and the Built Enviroment, Delft University of Technology. In his
department OTB – Research for the Built Environment, the interactions between
people, the built environment and technology are a focus point for research and
teaching, including new forms of self-organisation by citizens and contemporary
forms of area development.
Dr. Jessica Lindbergh, Stockholm University, Sweden
Dr. Jessica Lindbergh is Senior Lecturer in Business with a focus on
Entrepreneurship at Stockholm Business School, Stockholm University.
The Management department in which she works holds the interplay between
organisations and society in high importance. The entrepreneurship research and
teaching focuses on the development of forms entrepreneurships, societal change
and sustainability.
Acknowledgements
The three authors would like to oer our sincere thanks to all those who contributed
to this project as interviewees and contributors to the seminars. In particular, we are
very grateful to Richard Harries and Ailbhe McNabola from Power to Change for
their support and encouragement in carrying out the project.
Power to Change Research Institute Report No. 12 1
An assessment of community-based social enterprises in three European countries
Executive summary
Background and methodology
In October 2016, Power to Change commissioned a team from the University of
Westminster, Delft University of Technology and Stockholm University to carry out
a comparative study of community-based social enterprise (CBSE) in England, the
Netherlands and Sweden. National policy was reviewed and three case studies
were selected from each country, in order to provide an evidence base for making
comparisons and drawing out more general conclusions about the development of
the sector.
CBSEs take many organisational and legal forms but for our purposes we selected
examples which display the characteristics as used by Power to Change to define
community businesses. They are:
Locally rooted: They are rooted in a particular geographical place and respond
to its needs. For example, that could be high levels of urban deprivation or rural
isolation.
Trading for the benefit of the local community: They are not-for-private-profit
businesses. Their income comes from diverse activities such as renting out space
in their buildings, providing services, trading as cafés, selling produce they grow
or generating energy.
Accountable to the local community: They are accountable to local people,
for example through a community shares oer that creates members who have
a voice in the direction of the business.
Broad community impact: They benefit and impact on their local community
as a whole. They often morph into the hub of a neighbourhood, where all types
of local groups gather, for example to access broadband or get training in vital
life skills.
Power to Change Research Institute Report No. 122
An assessment of community-based social enterprises in three European countries
Methodology
This project was carried out by the research leads from the three universities
using a mixed methods approach. Having reviewed national and local
policy in the three countries, three CBSEs were investigated in depth in each
country making a total of nine case studies. Access to key stakeholders was
negotiated through known contacts and organisations such as Power to
Change and Locality in England, the National Association of Active Residents
in the Netherlands and Coompanion in Sweden. Case studies were selected
in order to be broadly representative of the sector in terms of organisations’
age, location, sources of funding, assets and services provided and systems
of governance. Summaries of each case study are published in the Appendix
Quantitative and qualitative research was carried out using published
and unpublished sources, including relevant academic journal articles.
Semi-structured interviews were carried out with a variety of stakeholders.
The interviews were digitally recorded, transcribed and retained by the
researchers. Seminars enabled findings to be shared and comparative
insights to be developed between countries with the assistance of external
contributors. It was agreed that the purpose of the project was not to
evaluate or make judgements about individual CBSEs but to learn from their
experiences so that conclusions could be drawn within and between countries..
Case studies
England
Goodwin Trust, Thornton estate, Hull (Yorkshire)
Millfields Trust, Stonehouse, Plymouth (South West)
OrganicLea, Waltham Forest (London)
The Netherlands
Stichting Bewonersbedrijven Zaanstad (SBZ)
Bewonersbedrijf Malburgen (BBM) Malburgen, Arnhem
Bewonersbedrijf Crabbehoeve (BBC) Crabbehof, Dordrecht
Sweden
Yalla Trappan, Rosengård, Malmö
Nya Folkets Hus Rågsved Rågsved, Stockholm
Roslagskrafterna, Norrtälje
Power to Change Research Institute Report No. 12 3
An assessment of community-based social enterprises in three European countries
Executive summary
A comparison of government policy relating to community-based
social enterprise
Definitions: In all three countries, the terms used to describe the social enterprise
sector are not clearly defined and may vary according to changing political
perspectives and priorities over time. However, funding and support organisations
often develop their own definitions and funding criteria.
Origins: CBSEs strike a balance between non-commercial, community
development-related activities and commercial trading operations which may
produce a surplus. CBSE organisations in all three countries often begin as
community development organisations but gradually take on assets or service
contracts which increasingly represent a source of income and thus ensure
relative autonomy.
National policy: All three countries lack a clear policy framework for social
enterprise and in particular for CBSEs. Responsibilities are also divided between
several dierent government departments, sometimes with unclear ministerial
accountability.
Legal structures: CBSEs may adopt a number of dierent organisational entities
in order to provide a legal status and financial protection to board members. This
depends on the legal and administrative forms available in each country.
National support organisations: All three countries have active national support
organisations which provide services including membership, technical and legal
advice, research, publications and access to specific funding programmes.
Financial support: CBSEs have access to a range of public and charitable funding
sources. These can be available nationally or only in particular geographical
locations. In England the National Lottery was particularly important for CBSEs
through, for example the setting up of Power to Change (an organisation dedicated
to funding and supporting community business). The Heritage Lottery Fund is
another important funder as many CBSEs operate from heritage buildings.
Local authority support: Local authorities and housing associations have
limited powers or resources to support CBSEs. Some are willing to oer leases
on buildings (or other assets) of varying lengths at rents below full market value.
Much depends on personal contacts through political representatives or highly
motivated ocers.
Power to Change Research Institute Report No. 124
An assessment of community-based social enterprises in three European countries
Executive summary
Key characteristics and findings from case studies in the three countries
Similarities:
All case studies adopted systems of organisation and management
relevant to their national cultures and legal frameworks but with some
common elements;
All demonstrate aspects of social innovation and entrepreneurialism
in their organisation and management practices, the projects and
opportunities secured, and the ability to work in collaboration with other
local service providers;
All develop hybrid business models which seek to combine trading and
non-trading activities, in order to achieve financial sustainability in the
longer term. Many rely on grants and loans from public and charitable
sources particularly in the early years;
Accountability is interpreted dierently depending on the nature of the
organisation. All define the community to whom they are accountable
dierently; some narrowly to users or others in regular contact, others
to those living in a defined neighbourhood;
Recruitment: Board members tend to be recruited on the basis of their
personal knowledge and skills rather than simply as representatives of an
area or interest. Most case studies report diculties in attracting new board
members with relevant knowledge and skills and there is little evidence of
succession strategies to allow for a regular turnover of local representatives;
The development of strong core values and principles which permeate
through the organisation and influence their activities is balanced by the
need to be flexible and responsive if new opportunities arise. These need
a careful risk assessment to ensure they reinforce the core values rather
than undermine them. Trading and non-trading activities need to be
carefully balanced;
Charitable activities: There are examples in all three countries of CBSEs
making surpluses which are then allocated to support other community
organisations in the area;
Impact was perceived as being significant, particularly at the local level
and in relation to the resources available, but CBSEs very rarely carried out
a systematic evaluation of their impact except through normal financial and
management reports to the board and sometimes in annual reports.
Power to Change Research Institute Report No. 12 5
An assessment of community-based social enterprises in three European countries
Executive summary
Dierences
Origins: CBSEs, particularly in England and the Netherlands, often
emerged out of previous community development or regeneration projects
and involved activists with relevant expertise. In Sweden case studies
tended to be more orientated towards creating employment opportunities
which is a reflection of the emphasis on work integrated social enterprise
(WISE) through dierent state initiatives and where Coompanion is the
national support organisation;
The context in which the CBSE operates is crucial in determining their
role and prospects for growth. This includes potential funding sources,
the ability to negotiate contracts and acquire assets and the need to
secure collaborative relationships with a network of other agencies;
Expansion through asset transfer of land and buildings from sympathetic
local authorities is most evident in England and to a lesser extent the
Netherlands;
The sector is relatively undeveloped in all three countries. There is no
national, strategic policy and at the local level much depends on highly
motivated activists and the relationship with ‘boundary spanners’ such
as local authorities, local economic development agencies and specialist
support organisations;
Leadership varies between the three countries. In Sweden it is often
the chairperson who provides leadership whereas in England there is
a tradition of the chief executive playing the leading role in developing
strategy and promoting the organisation externally. In the Netherlands
leadership often emerges from board members, paid sta or volunteers;
Accountable to the local community: All the case studies generally
support the principles of being accountable but how they perceive this
role varies between countries. In Sweden the view is taken that users and
beneficiaries are the community whereas in England and the Netherlands
there is a perception that the CBSE should be accountable to a wider range
of stakeholders, including local residents in the target area.
Power to Change Research Institute Report No. 126
An assessment of community-based social enterprises in three European countries
Executive summary
Conclusions and prospects for growth
CBSEs in the three countries are on similar trajectories from a low-level start as a
community project, gaining an increasing income from commercial activities over
time, and at some point in the future developing a more diversified range of services
and facilities based on both commercial trading and non-commercial funding.
Achieving financial sustainability takes time and some experience major financial
challenges in the early years. The two largest case studies in England have been
active for over 20 years. Thus, CBSEs can be both innovative and entrepreneurial
in developing this hybrid business model which is pioneering new approaches
to service delivery as part of a larger strategy of inclusive growth. Each seeks
financial sustainability but this will depend on the opportunities and constraints it
identifies in its locality and through developing boundary-spanning, collaborative
arrangements with others. However, central and local governments in all three
countries are often perceived as ambivalent to the CBSE model and may appear
uncertain as to whether they should support this sector and if so, how best to
provide such support.
The most significant dierences are largely related to variations in the national
and local context, political background and history of citizen-based initiatives.
Many similarities have also become apparent between CBSEs in the three
countries, particularly in terms of innovation and entrepreneurialism. The main
conclusion is that CBSEs are a response to relative austerity in each country
as well as a desire to promote dierent forms of ‘citizen-centred governance’
(Barnes et al., 2008), while also emerging from dierent national cultures and
local contexts. It is the dierent legal and administrative frameworks which have
a major influence on the establishment and support for CBSEs, while creating
opportunities to deliver services and to provide facilities which would not
otherwise be available.
Power to Change Research Institute Report No. 12 7
An assessment of community-based social enterprises in three European countries
Executive summary
Introduction
This project was funded by Power to Change in October 2016 and its primary focus
is the role and impact of community-based social enterprises (CBSEs) in three
European countries: England, the Netherlands and Sweden. CBSEs (often called
community businesses) can be dierentiated from social enterprises by defining
their purpose, benefits and management in relation to communities in defined
areas. They are, however, just one category of social innovation emerging from
the complex network of agencies and interests in all European urban areas (see
for example, Brandsen et al., 2016).
The three countries selected are similar in economic circumstances, in the impact of
austerity on traditional welfare support programmes, and in a desire to develop and
enhance the contribution of social and community enterprise to fulfil unmet needs.
It was our starting hypothesis, however, that there are also substantial dierences
based on historical, cultural and contextual factors. In all three countries, there is
strong evidence that CBSEs have developed rapidly through innovative approaches
to co-production and changing citizen-government relationships.
Objectives
This report sets out to explore the similarities and dierences between these
countries, particularly where CBSEs are making a significant contribution
towards contemporary forms of urban regeneration and reducing inequalities
and deprivation. The main objectives were to:
1. Identify the national and local policy parameters in which CBSEs are located,
in order to identify how they have evolved and the legal, technical and political
framework in which they operate in relation to broader societal and regeneration
objectives;
2. Review sources and levels of technical and financial support available from
stakeholders and national bodies and to determine the extent to which these
are critical to achieving sustainability and organisational objectives;
3. Determine through case studies the methods and extent to which performance
outputs and impact are monitored and evaluated;
4. Generate findings and broader conclusions of direct relevance to the case
study organisations, local and national stakeholders, and the wider EU
community.
Power to Change Research Institute Report No. 128
An assessment of community-based social enterprises in three European countries
Table 1: Membership of project consortium
Organisation Typ e of
Organisation
Country Contact person
Principal
Investigator
University of Westminster,
Centre for Urban
Infrastructures
Research England Prof. Nick Bailey
Co-investigator Delft University of
Technology,
Faculty of Architecture & the
Built Environment
Research Netherlands Dr. Reinout
Kleinhans
Co-investigator Stockholm University,
School of Business and
Centre for Stockholm School
of Entrepreneurship
Research Sweden Dr. Jessica
Lindbergh
Additional
Participants
Technical
support
Steve Clare
(formerly of Locality)
Cyta Consulting Ltd (a firm
committed to supporting and
advising CBSEs in the UK)
Practice UK Steve Clare
Technical
support
LSA (National Association
of Active Citizens)
Practice Netherlands Marieke Boeije,
Kristel Jeuring
Technical
support
Coompanion (association
supporting co-operative
entrepreneurship)
Practice Sweden Jenny
Kowalewski
Report structure
The report is divided into three main sections:
Section 1 discusses the national policy context in each country, identifies the role
of support organisations and sets out the main sources of public and charitable
funding available to CBSEs.
Section 2 provides an analysis of the case studies in each country.
Section 3 sets out a synthesis of the main similarities and dierences between the
three countries.
The Appendix
Summaries of the nine case studies are published in the appendix. In Tables 2, 3
and 4 we set out a summary of each case study in the three participating countries.
Power to Change Research Institute Report No. 12 9
An assessment of community-based social enterprises in three European countries
Introduction
Table 2: Summary of case studies in England
Goodwin Trust, Thornton estate, Hull (Yorkshire) | Start date: 1995
Legal structure Company limited by guarantee and charity, Goodwin Community Trading Ltd,
Goodwin Community Housing Ltd.
Core values
and aims
To develop the community and to reduce deprivation through the acquisition
of assets in order to deliver high quality services to meet community needs.
Trading
activities
A wide range of services provided to expectant mothers, a nursery, child care,
youth provision, community meeting spaces, food bank, arts and training.
Including a radio station.
Construction of 41 aordable homes and management of 50 others.
Non-trading
activities
Almost all activities are self- funding or grant funded, often a combination
of trading and non-trading.
Key partners
& funders
Hull city council, EU funding, Arts Council, contracts from a variety of agencies,
Homes & Communities Agency.
Millfields Trust, Stonehouse, Plymouth (South West) | Start date: 1998
Legal structure Company limited by guarantee, community interest company, separate charity.
Open membership for anyone over 18 living in the area.
Core values
and aims
To promote the regeneration of the Stonehouse area through the provision of work
space and employment, and encouraging children to raise their aspirations and open
up new work opportunities.
Trading
activities
More than 90 business tenants employing about 300 people, other land and
buildings, a pub.
Non-trading
activities
A charity, Millfields Inspired, funded by the Trust to widen the horizons of primary
school children.
Key partners
& funders
Plymouth city council, Local Enterprise Partnership, ERDF.
OrganicLea, Waltham Forest (London) | Start date: 2001
Legal structure Workers’ co-operative registered with Co-operatives UK, company limited by
guarantee.
Core values
and aims
To produce and distribute food and plants locally, and inspire and support others
to do the same. We bring people together to take action towards a just and
sustainable society.
Trading
activities
Growing and selling over 100 varieties of fruit and vegetables, honey and wine, a veg
box scheme, market stalls and sales to restaurants, a cafe, and training courses.
Non-trading
activities
Supporting and training volunteers, some with learning diculties.
Key partners
& funders
Esme Fairbairn Trust, Power to Change, local authorities, Big Lottery’s Making Local
Food Work programme.
Power to Change Research Institute Report No. 1210
An assessment of community-based social enterprises in three European countries
Introduction
Table 3: Summary of case studies in the Netherlands
Stichting Bewonersbedrijven Zaanstad (SBZ) Poelenburg, Zaanstad | Start date: 2013
Legal structure Foundation (stichting) with an ANBI-status, i.e. an ‘institution working for a public
benefit’.
Core values
and aims
To improve the local economy, employment and ‘liveability’, not only in the
Poelenburg area, but also other neighbourhoods. Mission: working on employment,
working on the neighbourhood and working on each other.
Trading
activities
Renting out meeting spaces from the local neighbourhood centre (until May 2017),
acting as subcontractor in the local ‘social neighbourhood teams’, and small
renovation works commissioned by local housing associations.
Non-trading
activities
Resident coaches, providing ‘work experience positions’, collecting bulky garbage,
running a neighbourhood garden, and organising sports activities in the Poelenburg
neighbourhood.
Key partners
& funders
Local government of Zaandam (in particular various departments), local housing
associations Rochdale and Parteon, the Dock foundation (care), Doen foundation
(funding) and others.
Bewonersbedrijf Malburgen (BBM) Malburgen, Arnhem | Start date: 2013
Legal structure Foundation (stichting) with an ANBI-status, i.e. an ‘institution working for a public
benefit’.
Core values
and aims
Provision of aordable housing to people from low-income and diverse
backgrounds; to oer a meeting place for residents of Malburgen; provide
opportunities for education and job training, enabling local residents to further
develop themselves.
Trading
activities
Renting out 130 units (primarily rooms, but also meeting / oce spaces) from a
renovated former care home.
Non-trading
activities
Tenants are expected to volunteer in the neighbourhood, supporting various social
activities. BBM accommodates self-employed people and associations oering
recreational, physical exercise, do-it-yourself or other activities.
Key partners
& funders
The local housing association Volkshuisvesting, Philadelphia (care), ‘social
neighbourhood teams’ and others.
Bewonersbedrijf Crabbehoeve (BBC) Crabbehof, Dordrecht | Start date: 2014
Legal structure Foundation (stichting) with an ANBI-status, i.e. an ‘institution working for a public
benefit’.
Core values
and aims
Oering a multifunctional meeting place for neighbourhood residents, enabling
them to meet people, volunteer for the neighbourhood, gain work experience,
transfer knowledge and to develop budding talents and entrepreneurship.
Trading
activities
Renting out a conference room, lunchroom with garden terrace and a workshop,
catering services (using garden crops), and targeting fundraising.
Non-trading
activities
The BBC hosts sewing ateliers, workshops, reading sessions, hobby workshops,
playful biology lessons for children, billiards and darts. It has a small library and
an Internet café. Volunteers helping in the garden can take home free produce.
Key partners
& funders
Local government, MEE (care organisation), local housing association, Doen
foundation (funding) and others.
Power to Change Research Institute Report No. 12 11
An assessment of community-based social enterprises in three European countries
Introduction
Table 4: Summary of case studies in Sweden
Yalla Trappan, Rosengård, Malmö | Start date: 2010
Legal structure Non-profit women’s co-operative which is open for general membership.
Core values
and aims
Co-operative with a one member, one vote system. Empowers immigrant women
that are far out of the job market.
Trading
activities
Café, catering, hand crafted food (marmalade, spices etc.), study visits, sewing and
design studio, cleaning and conference service as well as on site job training.
Non-trading
activities
Empowerment of female immigrants through language lessons and learning about
Swedish society as well as legal matters, societal integration and experience and
knowledge of how to run a business.
Key partners
& funders
Members, Malmö City Council, IKEA and the employment service agency.
Nya Folkets Hus Rågsved Rågsved, Stockholm | Start date: 2007
(previous organisation in 1980)
Legal structure Non-profit, member driven by local organisations and associations with additional
forms of legal structure such as limited company and a foundation.
Core values
and aims
Aims to be an agency that both follows and initiates social change and provides
local meeting space for democratic meetings.
Trading
activities
Rental of meeting space, arranges business conferences, café and catering,
second hand shop, on site job training.
Non-trading
activities
Give space and advice on how to organise citizen initiatives and provides cultural
experiences (e.g art exhibitions, theatre plays for children, workshops in music),
helps with homework and provides Christmas supper.
Key partners
& funders
Member organisations, local city council, employment service agency, Stockholm’s
business regions development as well as local real estate owners.
Roslagskrafterna Norrtälje | Start date: 2014
Legal structure Economic association and Workers’ Co-operative.
Core values
and aims
Create an opportunity to build a work place that suits them through a co-operative
social enterprise, provide on-site job training for people that have similar
experiences and engage in local charity.
Trading
activities
Second hand shop, remake multi-services, job training and two cafés.
Non-trading
activities
Experience and knowledge of how to run a business.
Key partners
& funders
Members, Coompanion, municipality council, a recycling company and the
employment service agency.
Power to Change Research Institute Report No. 1212
An assessment of community-based social enterprises in three European countries
Introduction
1. A comparison of government policy
relating to community-based social
enterprise
1.1 Introduction to the project
During the first part of the project a review was carried out in England, the
Netherlands and Sweden in order to assess how far there is a clear policy basis
for CBSE and to what extent and by which organisations it is being supported,
funded and encouraged to grow.
This section provides an overview of national policy and relevant support and
funding organisations for CBSEs for England (although reference is made to other
parts of the United Kingdom), the Netherlands and Sweden.
1.2 Definitions
There are many definitions used to describe organisations which fall under the
general heading of ‘social enterprise’. These include social business, community
business and business with a social mission. Co-operatives might be included but
these are normally organisations where the members jointly own the business
rather than contributing to its management primarily as members, trustees,
employees, or volunteers. This project focuses particularly on CBSEs which we see
as a sub-set of the broader social enterprise or community business category.
We also note that the academic literature is increasingly making connections
between social innovation, social economy and social enterprise where needs
are being met by a ‘third sector’ which is expanding in many European countries
(Defourny and Nyssens, 2013: 40). We argue that CBSEs are social enterprises
which operate in a defined geographical location or ‘community’ and give a high
priority to engaging local residents and businesses in the management of the
enterprise and delivery of projects. In practice, policy and funding opportunities
relate to the broad categories of social enterprise or community business, rather
than the narrower definition of CBSEs. In general terms, the organisations we are
researching have the following characteristics as defined by Power to Change.
They are:
Locally rooted: They are rooted in a particular geographical place and
respond to its needs. For example, that could be high levels of urban
deprivation or rural isolation.
Trading for the benefit of the local community: They are businesses, aiming
to generate profit to be reinvested in the local community. Their income comes
from activities such as renting out space in their buildings, providing services,
trading as cafes, selling produce they grow or generating energy.
Accountable to the local community: They are accountable to local people,
for example through a community shares oer that creates members who
have a voice in the business’s direction.
Power to Change Research Institute Report No. 12 13
An assessment of community-based social enterprises in three European countries
Broad community impact: They benefit and impact their local community as
a whole. They often morph into the hub of a neighbourhood, where all types
of local groups gather, for example to access broadband or get training in
vital life skills.
A survey by the European Commission (EC) found that most of the 29 member
states had evidence of social enterprises but that only 8 out of 29 had a ‘specific
policy framework for supporting the development of social enterprise’. There were
also many dierent legal frameworks involved. The EC report defined three
dimensions (entrepreneurial, social and governance) and five criteria which
define the role of ‘social enterprise’ (EC, 2014: 2).
The organisation must engage in economic activity: this means that it must
engage in a continuous activity of production and/or exchange of goods
and/or services;
It must pursue an explicit and primary social aim: a social aim is one that
benefits society;
It must have limits on distribution of profits and/or assets: the purpose
of such limits is to prioritise the social aim over profit making;
It must be independent i.e. organisational autonomy from the state
and other traditional for-profit organisations; and
It must have inclusive governance i.e. characterised by participatory
and/or democratic decision-making processes. (EU, 2014: 2).
1.3 The Netherlands
There is no ocial definition of social enterprise in the Netherlands. In academic,
policy and practice discussions, a range of terms are used, such as ‘sociale
ondernemingen’ (SEs), ‘sociale firmas’ (social firms) and, to a much lesser
extent, co-operatives. The concept of ‘maatschappelijke organisaties’ (societal
organisations) is also widely used, but it refers to a broader set of organisations,
focusing on the ‘public good’, including public benefit companies, housing
associations and health and educational institutions (EC, 2014, p.i). As part of
an EU-wide mapping eort of social enterprise (SE), the EU country report on
the Netherlands distinguishes broadly between several types of SEs with
dierent legal statuses:
NGOs, foundations and associations with revenue generating activities, social
aims and participative models- these could be considered social enterprises if
they have clear social aims and revenue generating activities (market activity).
‘Social’ co-operatives: these are generally to be considered social enterprises
as they are co-operatives pursuing a social mission, not serving the interests of
their members.
Power to Change Research Institute Report No. 1214
An assessment of community-based social enterprises in three European countries
1. A comparison of government policy relating to community-based social enterprise
Mainstream enterprises emphasising their social mission in business models: if
having a social aim and caps on profit-making these would fit the spectrum of
social enterprises.
Work integration companies: operating under a variety of legal forms but
under a given number of existing laws providing the legal framework for their
existence these are generally considered to be social enterprises.
Semi-public enterprises with societal aims: according to some these should be
considered as social enterprises, and might meet most of the criteria.
1.4 Sweden
In Sweden, there is a long tradition of strong popular movements (Berglund and
Johannisson, 2012) such as labour unions, free churches, sports associations,
village associations, temperance and youth movements but the social enterprise
sector that use a more outspoken business logic has only emerged comparatively
recently. There is no specific legal form for social enterprises in Sweden; they
can choose whatever form is perceived as most appropriate for their activities.
In general, organisational forms tend to be business enterprises (sole trader,
trading partnership, limited partnership and limited company) and associations
(economic and not-for-profit). The most common forms are economic associations,
not-for-profit associations and private limited companies (Tillväxtverket, 2012).
Some social enterprises also use several legal forms in order to separate the
more socially orientated objectives from economic or trading activities (EC, 2014).
Definitions of ‘social enterprise’ and ‘work integrated social enterprise’ (WISE) are
sometimes used interchangeably by government bodies and other supporting
organisations. The Swedish Agency for Economical and Regional Growth has
been given the responsibility to design and implement a national programme that
will stimulate the creation and growth of WISEs in cooperation with the Swedish
Employment Agency (Arbetsförmedlingen). Association enterprises with a particular
focus on community development in rural areas (i.e. benefits for a larger number
of people) can also receive support in the form of project funding from the Swedish
Board of Agriculture.
1.5 England and the United Kingdom
In the United Kingdom (UK) there is a long history of a variety of forms of social
enterprise (see Gordon, 2015, Spear et al. 2017) set out in detail the wide range of
types of social enterprise models and their evolution under dierent government
regimes in the UK since 1998. A sub-set of the wider category is community
enterprise which relates closely to our definition of CBSEs in that they are
locally rooted and managed.
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There are several legal frameworks which community enterprises can adopt
including: company limited by guarantee, community interest company (CIC),
community benefit society or co-operative society (FCA, 2014). Many also qualify
for charitable status which brings tax advantages. There is no nationally-agreed
definition of social enterprise or CBSEs but Locality provides this definition:
Community enterprise is a significant sub-sector within the wider social enterprise
sector. It shares the same definition as social enterprise: an organisation trading
for social purpose with profits reinvested rather than going to shareholders. But a
community enterprise is more specific in that it is based in, and provides benefits to
a particular local neighbourhood or community of identity. A community enterprise
is owned and managed by members of that community. It is an organisation run by
a community as well as for a community. (Locality, 2016).
Research commissioned by Power to Change suggest a steady increase in the
number of community businesses in England reaching 7,085 (including village
halls) in 2016 with assets to the value of £2.1 billion (Hull et al, 2016: 2).
1.6 Are there national policies?
There was very little evidence from all three countries, apart from in Scotland,
that a coherent strategy exists at central government level for developing the
social enterprise sector and CBSEs in particular.
In the UK, this is a policy area which is the responsibility of central government
for England and of the three devolved administrations in the rest of the UK. In
England, the most comprehensive policy statement dates from 2002 when the
Department of Trade and Industry published ‘Social Enterprise: A Strategy for
Success’ (DTI, 2002). Responsibility for social enterprise currently lies with a
Minister in the Department of Digital, Culture, Media and Sport (DCMS) who also
has responsibility for the voluntary sector and social investment in general. The
Department of Communities and Local Government has separate responsibility
for the transfer of assets (Locality, 2016) from the public sector to community-based
organisations as well as the Localism Act 2011. Thus, there are a variety of
responsibilities and powers but very little evidence of a clear policy and strategy
for delivery backed up with resources. However, the Scottish Government has
recently produced a national strategy (Scottish Government, 2016) and the Welsh
Government has produced a good practice guide (Welsh Government, 2016).
In the Netherlands, there is a similar absence of a clear policy direction and the
involvement of several dierent government departments.
The lack of a clear policy framework is also visible in the lack of responsibilities
among national government departments. The Netherlands Enterprise Agency
(RVO.nl) is part of the Ministry of Economic Aairs and works at the instigation
of ministries and the European Union. This particular institution encourages
entrepreneurs in sustainable, agrarian, innovative and international business,
helping with grants, finding business partners, general know-how as well as
sharing knowledge around compliance with laws and regulations (see http://
english.rvo.nl/home/about-rvonl/what-is-rvonl). Apart from this institution,
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several other ministries (e.g. the Ministry of the Interior) make reference to
social enterprise, but do not have any executive or legal powers.
However, in the context of growing austerity and budget cuts the Ministry of
the Interior published a White Paper which proposes to oer room for societal
initiatives and to support citizens to take action on societal issues. The White
Paper, ‘Do-it-yourself Democracy’, states:
The Cabinet aims to oer room and trust for societal initiatives and actively
support the transition towards a do-it-yourself democracy (which is a form of
citizens’ taking a part in deciding to take up societal issues themselves) […].
Several societal trends require a cabinet’s view on this matter: a) an increasing
level of self-organisation in society, b) a retrenching government, and c) an
increasing demand for social connectedness. Apart from these trends, the
transition to more do-it-yourself democracy is relevant from a governmental
point of view, due to scaling-up, decentralisation and budget cuts (BZK, 2013: 3).
In 2015 the Social and Economic Council of the Netherlands (Sociaal-Economische
Raad – SER) issued an advisory report1 entitled ‘Social Enterprises’ (Sociale
Ondernemingen), which is fundamental to the government’s position towards
social enterprises. The SER prepared the advisory report at the request of the
Minister of Social Aairs and Employment. While embracing the EU definition
of social enterprise, the SER emphasised that social enterprises are distinct
from other businesses in that their primary and explicit objective is to increase
positive externalities, to reduce negative externalities, or to assist disadvantaged
employees or clients (SER, 2015a). The SER has identified several key obstacles
to improving the positive social impact of social enterprises (SER 2015b: 3-4):
Problems related to impact measurement;
Limited recognition and appreciation of social enterprises;
Financing problems;
Obstructions in the law;
Government procurement problems.
The City Network G32, which includes the administrations of the 32 largest cities
of the Netherlands, has recently put significantly more eort into understanding
social entrepreneurship. For this reason, they have issued a ‘road-map’ which
aims to oer insights to local authorities on how to foster and develop social
entrepreneurship. Central to this is the creation and maintenance of a ‘social
entrepreneurial-friendly ecosystem’ (G32, 2017).
In Sweden, there is no policy statement regarding social enterprise in general.
Instead the focus has been on WISE. In 2010, a plan of action regarding WISE
was agreed. However, since the beginning of 2016 the government has given the
Ministry of Enterprise and Innovation responsibility for
1 An English summary of this report can be found at: http://www.ser.nl/~/media/files/internet/talen/
engels/2015/2015-social-enterprises.ashx
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supporting social enterprise and social innovations. According to recent statements,
the proposals are currently being reviewed and discussed are ongoing regarding
how, when and where they should be implemented by the government. Moreover,
the summary of suggested solutions has not been published.
Sweden has no legal framework for social enterprise or any particular legal
organisational form and ‘social enterprise’ and ‘work integrated social enterprise’
are sometimes used interchangeably by government bodies and other supporting
organisations (EC, 2014). Responsibility for WISE is currently divided between
the Ministry of Employment and the Ministry of Enterprise and Innovation.
The responsibility for social enterprise (even though there is no such formal
definition) is divided between two ministers in two dierent oces – the Minister
for Employment and Integration based at the Ministry of Employment, and the
Minister at the Ministry of Enterprise and Innovation.
1.7 Distribution
There are more and larger CBSEs in the UK than in other European countries,
probably because the well-established ‘Anglo-Saxon’ model of community
organisation has been prevalent there for a longer period of time. However,
the distribution in all three countries tends to be fairly random and dependent
largely on local activists and other bodies identifying both a need and a potential
to mobilise local stakeholders. The development of the sector in the Netherlands
and Sweden tends to be more recent and as a response to financial restraint and a
general trend towards neo-liberalism in European states. CBSEs in these countries
tend to be fewer and smaller. In all three countries, CBSEs are located in both
urban and rural areas. In England, the largest tend to be in inner urban locations
and often in areas of significant levels of deprivation.
1.8 National support organisations
In each country, there are a number of membership and support organisations
operating at the national level. Some also oer grants or assist CBSEs in accessing
funding from other sources.
Sweden
In Sweden, Coompanion is a corporate advisor for co-operatives which is supported
by the Swedish Agency for Economical and Regional Growth and which oers free
advice to co-operatives. The majority of their support is provided to WISEs.
Coompanion provides what are referred to as ‘innovation checks’ that can be worth
up to SEK 100,000 per co-operative. The co-operative should have a minimum of
three and a maximum of 250 employees. The innovation checks can be used to buy
external expertise from universities, research centres, and consultants regarding
for example new business models, new products and services. The money cannot
be used for ordinary operations. Coompanion is established as a national network
covering 25 regions in Sweden (see http://coompanion.se/ – helpyou).
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Other organisations involved with social enterprises and social economy, who
also have a part in adopting action plans for WISEs, are the National Association
of for Social Work Co-operatives (SKOOPI) and Sofisam. SKOOPI is a membership
organisation for WISEs. Primarily SKOOPI works to educate its members, and
arrange networking events and meetings (see http://www.skoopi.coop/about/).
Sofisam is a platform where government agencies, municipalities and other
interested parties can find information about social enterprises (primarily WISEs).
The website contains a list of WISEs as well as information about how to start a
social enterprise (see http://sofisam.se/om-sofisam.html).
The Swedish Association of Local Authorities and Regions (SALAR) has been
collaborating with the Swedish Agency for Economical and Regional Growth in
adopting the action plan for WISE. SALAR is an employer and representative
association for municipalities, county councils and regions. SALAR does not
however provide specific information and/or funding to social enterprises in
particular (see https://skl.se/tjanster/englishpages.411.html).
Hela Sverige ska leva (All Sweden shall live) is another relevant organisation,
with a focus on village development. This is a national association consisting of
nearly 4,700 village action groups; the aim is to support local development with a
focus on a sustainable society. The organisation oers advice and support to local
groups with knowledge on how to create local development. They also work as a
lobby organisation to influence public opinion and rural policies (see http://www.
helasverige.se/kansli/in-english/our-tasks).
In addition, there are a number of organisations that support particular projects
aiming to achieve social outcomes. Such funding is directed at particular projects
and tasks of a group and/or association, such as funding the construction of village
meeting spaces and sports facilities and/or venues.
The Netherlands
In the Netherlands, the main agency supporting CBSEs is the LSA. The LSA,
the National Association of Active Residents (Landelijk Samenwerkingsverband
Actieve Bewoners), is a platform of approximately 60 resident associations
from 38 municipalities in the Netherlands. It is a private non-governmental
organisation, consisting of a general director, project managers and support
sta, which receives a large part of its funding through the Dutch Ministry of the
Interior. Since its inception, LSA has looked for ways to strengthen the voice of
residents in neighbourhood (regeneration) policies and to stimulate bottom-up
initiatives of individual residents or groups to improve the quality of life in their
communities (see http://www.lsabewoners.nl/en/).
The RVO is the executive agency of the national government in the Netherlands
which is the most important public contact point for businesses, knowledge
institutions and government bodies which can be contacted for information,
advice, financing, networking and regulatory matters (http://english.rvo.nl/home/
about-rvonl/what-is-rvonl). (EU, 2014, p. 5). However, their scope is much broader
than social enterprises.
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Social Enterprise NL (https://www.social-enterprise.nl/english) is a fast-growing
network of social entrepreneurs established in 2012. Social Enterprise NL
represents, connects and supports the growing community of social enterprises
in the Netherlands. In November 2016, the number of members stood at 300 SEs.
Apart from providing support, Social Enterprise NL focuses on the local and
national government in improving the business environment for social enterprises.
Acknowledging that, contrary to many other countries, the Netherlands has no
separate legal structure for social enterprises, Social Enterprise NL has published
a white paper on a new legal structure as well as instigated the drafting of a Code
of Conduct for social enterprises (see https://www.social-enterprise.nl/english).
Social Powerhouse is also a support network run by and for social enterprises,
although it is less professional and active than Social Enterprise NL. The Social
Enterprise Lab (http://selab.nl/) brings together students, academics, practitioners,
experts and entrepreneurs, focusing on developing or scaling up social enterprises.
Their main activity is developing, validating and disseminating knowledge
from and about the social enterprise sector, and spanning various domains
(including health care and the environment). However, these agencies support
social enterprises in general, and do not explicitly mention CBSEs (http://www.
socialpowerhouse.nl/)
A type of organisation that does not have a formal status but is similar to CBSEs is
‘wijkondernemingen’ (neighbourhood enterprises). A platform with the same name
oers online information (http://wijkonderneming.nl). On closer inspection, this
reveals various legal forms, including associations, co-operatives, firms and social
enterprises. The relevancy of this platform is rooted in the explicit recognition of
collective action by neighbourhood residents to improve their living environment
or conditions, emphasising small scale action and proximity. This platform makes
explicit references to community trusts in the UK.
England
In England, there are a number of organisations operating to provide support and in
some cases funding to CBSEs. Social Enterprise UK (https://www.socialenterprise.
org.uk) is the national membership organisation for social enterprises whereas
Locality (http://www.locality.org.uk) is the national membership organisation for
CBSEs in England with approximately 600 member organisations.
Advice and funding are also channelled through a number of other organisations.
Power to Change is an independent charitable trust set up with an endowment
from the Big Lottery Fund. Its role is to support community businesses in England
over the next ten years. It also funds a Research Institute.
The Heritage Lottery Fund is a source of funding for restoring or converting
buildings listed for their architectural or historic importance.
The Big Lottery Fund’s £20 million Big Potential Fund (http://www.bigpotential.
org.uk/learn) is aimed at eligible voluntary, community and social enterprise
organisations (VSCEs) to improve their sustainability, capacity and scale and help
them deliver greater social impact for communities across England. Big Potential is
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administered by the Social Investment Business on behalf of the Big Lottery Fund
in partnership with Locality, Social Enterprise UK, Charity Bank and the University
of Northampton.
At the national level in England, £30m was allocated to support asset transfer
by the Big Lottery on behalf of the Oce of Civil Society in 2016. In 2017 Sport
England launched a Community Asset Fund of £15m to assist in improving sports
facilities and opening access to a wider range of users.
1.9 Support and funding at the local level
There is limited evidence of support at regional or sub-regional levels in the
three countries. In the UK powers to support social enterprise are devolved to the
four administrations and each has its own strategy and support organisations.
In England the 39 Local Enterprise Partnerships (LEPs) support business growth,
employment and skills training at regional or sub-regional levels. They tend to
be based on local authority boundaries and are normally managed by boards of
local businesses, employers and public agencies. An example is in London where
there is one LEP covering all 33 city boroughs and a population of 8.6 million.
LEP areas in England have been allocated €6.2 billion (£5.2 billion) as part of
the EU Structural and Investment Funds Growth Programme for 2014 to 2020.
In November 2013, each LEP published a strategy for how it intends to use the
funds. The strategies had to be aligned to the EU Structural and Investment Funds
Growth Programme’s top priorities: innovation, research and development, support
for SMEs, low carbon, skills, employment, and social inclusion. Since their inception,
Social Enterprise UK (SEUK, 2013) has worked to support regional and local
networks, and social enterprises themselves, to engage with LEPs in each area and
help them to achieve their objectives. But funding going to SEs or CBSEs is a very
small proportion of the allocated total.
There is no evidence of similar sub-regional bodies with a particular focus on SE
or CBSEs in the Netherlands or Sweden.
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1.10 Local authority support for CBSEs
Local authority support for CBSEs is uneven and often inconsistent between
dierent areas in all three countries. Much depends on local conditions and whether
eective contacts with political representatives or local authority ocers can be
secured over extended periods of time. Many CBSEs feel that their role and needs
are poorly understood and therefore rarely addressed by local government.
In England, there is little direct funding for core services for CBSEs and what was
available has declined since austerity was introduced after 2008. But support can
come in a variety of forms depending on local circumstances:
Transfer of assets (land and buildings) and registering assets of community value;
The award of service contracts;
Technical support in arranging contracts, leases etc.
Grants and loans (often at very low rates of interest);
Assistance with applications to other organisations, including match funding.
Levels of support vary in dierent locations but some local authorities, such as
Plymouth and Hull, have a good record of supporting community enterprise
based on political commitment and contact with various forms of social enterprise
over a number of years. Local authorities are also applying the principles behind
the Public Services (Social Value) Act 2012 and one in three (33%) now routinely
consider social value in their procurement and commissioning, and one in four
(24%) have a social value policy (SEUK, 2016).
In the Netherlands, a panel study (Kleinhans et al., 2015) analysed the local policy
context of CBSEs. Partly as a result of the absence of a national policy framework,
there are significant dierences in the ways in which local governments/local
authorities define and assess (CB)SEs. In line with the white paper ‘Do-It-Yourself
Democracy’ (BZK 2013), some local authorities choose to frame CBSEs in the
context of active citizenship, with a consequence that distinctions between social
enterprise, co-operatives and societal organisations are not clear. Hence, support
varies between local authorities, both in terms of content and finance. The extent to
which local authorities are supportive towards CBSEs appears largely dependent
on the opinions of individual ocials (local aldermen) and senior civil servants
who are well positioned in the organisation to act as a ‘broker’ between CBSEs
and the authority. The City Network G32 is now trying to foster and design social
entrepreneurship within the jurisdictions of the 32 largest cities, to stimulate a
‘social entrepreneurial-friendly ecosystem’ (G32, 2017). However, it is not yet clear
how this will translate into concrete measures.
In many cases, CBSEs receive financial support from either local authorities,
housing associations or both. Usually, this funding comes in the form of a
(temporary) subsidy or discounts on rent prices of real estate (such as empty
schools or care homes). In some cases, local authorities commission CBSEs to
deliver certain services, such as maintenance of green spaces. In the latter case,
funding is an integrated part of the business model of the CBSE.
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In Sweden, there are 290 municipalities and 20 county councils/regions. The
municipalities and county councils are encouraged to support social enterprises
but are not required by law to do so. There is also no requirement to have a special
unit and/or administrator dealing with social enterprises. However, a number of
municipalities have created a specific policy as to encourage the development of
social enterprises and also oer support in the form of pairing with Coompanion
who have a network of 25 oces throughout Sweden.
1.11 Conclusions
Definitions
The terms used to describe the social enterprise sector are not clearly defined
and may vary according to changing political perspectives and priorities over time
(see Teasdale, 2011). However, funding and support organisations often develop
their own definitions and funding criteria. In general, CBSEs provide a range of
commercial services and non-profit activities, often involving cross-subsidisation,
in order to deliver social, economic and environmental benefits for populations in
defined neighbourhoods.
The balance of activities
CBSEs in all three countries strike a balance between non-commercial,
community development – related activities and commercial trading operations
which may produce a surplus. Many organisations in all three countries often
begin as community development organisations but gradually take on assets
or service contracts which increasingly represent a source of income and thus
relative autonomy. Much depends on overcoming the barriers to acquiring assets
and identifying the levels of assistance provided by public bodies and support
organisations. The risks of taking on commercial activities can be high and
some organisations may be unwilling to accept these risks in the early stages
of development.
National policy framework
It is clear from this short review of the UK, the Netherlands and Sweden
that, despite seeing the potential for growth in this sector, all three countries
lack a clear policy framework for social enterprise and in particular CBSEs.
Responsibilities are also divided between several dierent government
departments and with sometimes unclear ministerial accountability.
The creation of new CBSEs is dependent on local initiatives and activities of
highly-motivated local groups; in none of the three countries are there any policy
incentives to locate in areas of deprivation or regeneration (Crisp et al, 2016). The
policy objectives adopted by particular CBSEs depend very much on the views of
the membership and priorities identified in their area.
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Legal frameworks
In all three countries CBSEs may adopt a number of dierent organisational
entities in order to provide financial protection to board members.
Distribution
In England (and the UK) there is a critical mass of well-established and financially
sustainable CBSEs, although the distribution is uneven. The development of the
sector in the Netherlands and Sweden tends to be more recent and as a response
to financial restraint and a general trend towards neo-liberalism in European
states. Interviewees suggest that CBSEs in these countries thus tend to be fewer
and smaller.
Support organisations
All three countries have a range of national support organisations which provide
services including membership, technical and legal advice, research, publications
and access to specific funding programmes. In some cases, as in the UK, these
organisations are designed to service particular sub-sets of the wider ‘social
enterprise’ sector but newly established organisations are not always fully aware
of what levels of support are available.
Local government support
In all three countries, local authorities have limited powers or resources to support
CBSEs. Much depends on personal contacts through political representatives or
highly motivated ocers.
The lack of clear national strategies reflects the relatively small part of the total
national economy represented by SEs. On the other hand, the absence of a
national policy can be seen as an opportunity in that it gives the sector more
freedom and flexibility to genuinely reflect the priorities and needs of particular
areas and to grow sustainably in order to meet local needs. In addition, a major
influence on how CBSEs develop is the range of funding bodies in each country,
the ability to acquire assets and their particular priorities. A unique feature of
CBSEs is the extent to which they are ‘locally rooted’ in terms of governance
by local people.
Power to Change Research Institute Report No. 1224
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1. A comparison of government policy relating to community-based social enterprise
2. Key characteristics and findings from
the case studies
2.1 England
2.1.1 Origins and development
All three English case studies were launched by small groups of activists who
had a mission to meet certain needs and to deliver certain services in their
area of operation. It was often the case that decisions made in the early days
largely determined the future direction of the organisation. It was usually a local
issue which triggered local activity leading to the organisation being set up. For
example, the chief executive of Goodwin Trust describes how the group started
in 1995 as a protest over the proposed development of a piece of open space.
Members of the local community ‘... persuaded the council to give them an empty
shop. The organisation became what came through the door. The organisation
just responded to need. They started a job club, computer programme. They
persuaded the Council to employ someone to do a business plan and that was
me. I was given a three-month contract.
Millfields Trust emerged slightly dierently when a large amount of floor space
became available after the local authority took control of a former naval hospital
in the area. Four units were transferred to the Trust on beneficial terms to be let as
work space for small businesses. Other buildings and sites on Union Street were
later leased to the Trust and some have been redeveloped. Likewise, OrganicLea
began when a small group of horticulturalists took over some unused allotments.
All three organisations have clearly defined core values of: enabling residents
to meet local needs; becoming self-sustaining and thus independent of other
interests; and promoting a philosophy of community organisation as the best
way to bring about social, economic and environmental change.
2.1.2 Defining objectives
The main objectives tend not to change much after the organisation is established
although new funding opportunities or assets may steer the organisation in a
particular direction. All have faced major challenges associated with rapid
changes in policy at central and local levels, high levels of risk in accessing
funding, borrowing money or taking on new assets; and diculties in sustaining
the organisation in both commercial and community-oriented activities.
CBSEs can be opportunistic if new opportunities arise or new funding streams
become available but tend to continue to operate in similar policy contexts. In
most cases this might be a contract to deliver a new service such as a nursery,
or an asset which becomes available and which can be acquired at a reasonable
(below market value) price, such as a church to be converted into a performance
hub and ‘village green’ as with the Goodwin Trust.
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Both Goodwin and Millfields identified areas of benefit in inner city locations;
Goodwin is based on the Thornton estate in Hull which is surrounded by four main
roads, Millfields operates in the Stonehouse neighbourhood of the St. Peter’s and
Waterfront ward of Plymouth. OrganicLea uses a less clear set of boundaries in
the London borough of Waltham Forest.
2.1.3 Organisation and management
All three CBSEs are independent self-managing organisations. Goodwin and
Millfields both have a board of management chaired by local residents and with
a broadly representative group of members who may be elected. Millfields board
includes two ward councillors and a representative of business tenants. These
CBSEs then employ a chief executive and other sta to manage the organisation.
While Millfields has set up a charity to improve knowledge of work in primary
schools in the area, Goodwin has set up two subsidiary companies: Goodwin
Community Trading Ltd with four directors as well as becoming a registered
housing provider which is constructing 41 homes in the area. OrganicLea is a
workers’ co-operative where those employed on contract for eight hours or more
per week become co-op members. All three case studies are companies limited by
guarantee. Goodwin is a registered charity while Millfields has set up a separate
charity, Millfields Inspired. OrganicLea, on the other hand, is not a charity.
In general, the boards are responsible for setting out the strategy, monitoring
performance and making major decisions about financial investment, borrowing
and auditing. Employees take responsibility for day-to-day decision making and
implementing the strategy. The chief executive plays an important role in acting
as a bridge between the sta and the board, representing the organisation
externally and identifying new opportunities sometimes in collaboration with
other stakeholders in the area. This might also include assisting in the formation
of CBSEs or social enterprises elsewhere.
2.1.4 Business model and funding
All three case studies meet the definition of ‘hybrid organisations’ in that they
pursue a dual mission of financial sustainability and social purpose. These
‘institutional logics’ can be complementary but are often in conflict thus providing
a further source of risk to the survival of the organisations. Thornton and Ocasio
(1999: 804) define institutional logics as “the socially constructed, historical
patterns of material practices, assumptions, values, beliefs, and rules by which
individuals produce and reproduce their material subsistence, organise time and
space and provide meaning to their social reality.”
In the early years all three case studies depended heavily on a variety of subsidies
and public sector grants and loans and local authorities often provided relatively
short leases on below market rents. Where available, grants from regeneration
programmes were also accessed. This was clearly set out by the chief executive
of Millfields:
Power to Change Research Institute Report No. 1226
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2. Key characteristics and findings from the case studies
England
‘The Trust formed itself as a company limited by guarantee in 1998 and I was
appointed in 1999 so it took a couple of years to get established. There was
more funding then, such as the Single Regeneration Budget.2 It was an opportunity
to draw down money from several sources such as English Partnerships, as the
[Royal Naval] hospital closed. These and European money were used to purchase
and refurbish the buildings and to find a bit of revenue to employ the first members
of sta’.
As they proved their viability, leases were often extended and additional assets
were transferred. In addition, the case studies made good use of other public
sector funding sources: European Regional Development Fund, Local Enterprise
Partnerships and third sector sources such as the Heritage Lottery Fund and
Power to Change. Where necessary, commercial loans were negotiated but only
on the basis of well-constructed business plans and backed by property oered
as collateral.
As a member of OrganicLea made clear, trading projects often also enable other
services to be provided, such as for those with learning diculties: ‘We have lots of
volunteers, some with learning diculties. It would not run on its own commercially
and sta are geared to managing the volunteers. We’ve had funding from the City
Bridge Trust to support this. Those grants are increasingly hard to come by.’
In all three case studies a complex but balanced business model is operated.
Trading opportunities tend to be exploited where they fit with the core objectives
and where they generate a surplus which enables the non-trading activities to be
undertaken or expanded.
2.1.5 Context
All three case studies are part of a complex network of local and national
organisations with which they collaborate, are funded or provide practical support.
OrganicLea is supported by and works with a variety of organic horticultural
organisations in London and the east of England, such as Farm Start and London
Grown, and has been funded by Power to Change. Millfields and Goodwin are
members of Locality but are also active members of social enterprise networks in
Plymouth and Hull respectively. In all three cases commercial income comes from
services provided, such as the cafe, market stall and veg box scheme provided by
OrganicLea and commercial rents in the case of Millfields and Goodwin. All three
also run contracts for local government and other agencies and make use of grants
from charitable organisations. Goodwin, for example, rents out 50 houses and also
received a large capital grant from the Homes and Communities Agency and a local
authority loan to build 41 homes which will also generate an income from managing
these. It is also funded by the Arts Council and the Hull City of Culture programme.
While public sector contracts can generate an income, rapid changes in funding
policy in the public sector can be a serious risk factor which requires CBSEs to be
highly flexible and responsible to changing circumstances.
2 A central government funding mechanism to support local projects which ran from 1995-2001
Power to Change Research Institute Report No. 12 27
An assessment of community-based social enterprises in three European countries
2. Key characteristics and findings from the case studies
England
Thus all three are part of an evolving network of dierent kinds of formal and
informal relationship with a variety of agencies and organisations where there
are mutual benefits arising. All are ‘hybrid’ in that they aim to balance commercial
and social objectives in order to achieve organisational sustainability and growth.
All also seek out new opportunities to take over assets which will increase
financial sustainability in the longer term and thus represent examples of new
forms of urban governance under austerity (Pill and Guarneros-Meza, 2017).
2.1.6 Accountability and representation
There are many dierent interpretations of accountability and representation.
None of the case studies would claim to be a democratically elected,
representative body for their neighbourhood; instead they see themselves as
running a business to the benefit of the wider community. Because they are well-
established local agencies, they may be consulted informally and can sometimes
be invited to bid for contracts or assets because of their known track record. Some
may also co-ordinate a systematic assessment of local needs and develop policy
towards meeting these. Millfields, for example, is investigating the acquisition and
management of aordable housing in the area while Goodwin is co-ordinating the
preparation of a neighbourhood plan based on extensive local consultation. On
the other hand, OrganicLea is located on the fringes of east London and focuses
entirely on developing its organic food and horticultural role.
In terms of publicising their role, these cases tend to rely on traditional methods,
such as annual general meetings, a website, annual reports and not least having
local residents on the management board. Goodwin is the only one of the three to
invite membership of the organisation which is open to anyone over the age of 18
who lives in the area. OrganicLea is dierent in that it is a workers’ co-operative and
thus board members are also employees. All also encourage a mix of volunteers
who often provide informal feedback on the role and activities of the organisations.
Funding bodies receive regular reports and informal meetings but none of
the case studies apply continuous and systematic methods of monitoring and
evaluation – this is achieved through regular reports to the management board.
The feeling is that things change too rapidly and there is neither the time nor
sta resources to carry out a detailed evaluation. There are always new funding
applications to be made and management issues to be resolved. A series of
projects are also at dierent stages of development and/or completion and it is
not always clear at which stage they should be evaluated.
2.1.7 Leadership
Leadership and entrepreneurship are hard to define in this context since CBSEs
like to portray themselves as organisations based on equity, equal opportunities
and collective endeavour. In practice strong alliances often develop between
the chief executive and the board and the chairperson in particular. The chief
executive may also be responsible for setting up and maintaining networks
with organisations which might share similar interests or could become future
collaborators. In some ways the relationship is similar to that in the private
sector or in local government where building a relationship of trust and mutual
understanding between key decision-makers is very important. This can prove
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An assessment of community-based social enterprises in three European countries
2. Key characteristics and findings from the case studies
England
very eective and resilient particularly where relationships develop over a long
period of time. Thus in both Millfields and Goodwin the chief executives have been
in post since the beginning and the chairs and some board members have a long
record of involvement. OrganicLea was started by two people with a passion for
horticulture and they are still actively involved.
It is normally the chief executive who is responsible for developing the external
profile of the organisation, engaging with wider local and national networks and
identifying new opportunities and projects. These then need to be discussed more
widely with sta and board members so that a consensus emerges about how
the organisation should be promoted and which objectives should be pursued in
future. This process of identifying opportunities, packaging projects and proposals
in order to be most attractive to funders, and identifying partners to enhance the
oer, can be described as ‘entrepreneurship’ in this context.
2.1.8 Prospects for growth
CBSEs may be cautious about expanding too rapidly and diluting the original
set of core values which launched the organisation in the first place. A variety
of opportunities for growth may arise and each has to be carefully evaluated by
balancing the risk against potential benefits. Institutional logics are an important
factor here in that choices sometimes have to be made about being more
commercial to generate an income in contrast to devoting more resources to
non-commercial, community-orientated activities.
All three English CBSEs were largely dependent on low cost and short term
leases and soft loans in the early years. Over time longer term leases or freehold
acquisition can be negotiated enabling expansion of activities and redevelopment
to occur. Both Millfields and Goodwin have redeveloped part of their estate for
higher value uses which is also allied with their social remit. OrganicLea has
negotiated acquisition of a further set of glasshouses with another London borough
and hopes to replicate a similar organisation there. The trend in all three cases is
on a gradual expansion of commercial income.
2.1.9 Conclusion
The English examples emerged out of the philosophies and practices of community
development and a tradition of mutual, co-operative organisations which have been
established since the nineteenth century in a variety of legal and organisational
forms (Spear et al, 2017). CBSEs have expanded in number since the 1990s where
austerity and state retrenchment has aected communities particularly severely.
Each necessitated a synthesis between commercial and non-commercial activities
whereby trading for commercial gain could be justified if it supported legitimate and
much needed non-trading, socially orientated objectives.
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An assessment of community-based social enterprises in three European countries
2. Key characteristics and findings from the case studies
England
The three English case studies broadly reflect the culture and traditions of
social enterprise and community development which have evolved over 50 or
60 years, but also include more recent developments towards innovation and
entrepreneurialism. They are driven by principles such as equity, independence,
community control of resources and the devolution of power and control to the
local level. OrganicLea has an additional set of values promoting health, good
quality food grown locally and a commitment to training and the engagement
of volunteers. They are also innovative, socially entrepreneurial, and require a
complex set of skills in order to balance the competing logics of trading and non-
trading activities.
2.2 The Netherlands
2.2.1 Origins and development
All three Dutch CBSEs started with small groups of active residents who had
previously been involved in the wider regeneration of their neighbourhood.
The three neighbourhoods are characterised by high levels of unemployment,
poverty, dependency on social benefits, low levels of education, low levels of
Dutch language fluency, and a high ethnic diversity, resulting in social tensions
between resident groups.
The CBSEs focus on socioeconomic issues such as work experience, the local
economy and ‘liveability’. Two CBSEs (SBZSBZ, and BBCBBC) were able to
take over the management of assets (neighbourhood centre and former elderly
care home), while the third actively lobbied the local government to take over
assets (a vacant kindergarten building). One CBSE (Bewonersbedrijf Malburgen
BBM) aims to provide aordable housing to low-income people with various
backgrounds.
All the CBSEs actively endorse the notion of their building functioning as a low-
key meeting place for neighbourhood residents and oer spaces to develop
activities and opportunities for education and work (experience) training.
2.2.2 Defining objectives
All Dutch CBSEs stated that their core objectives have not changed over the years
since the start of the business. This stability exists despite a number of challenges
posed to the CBSEs These challenges are as follows:
Maintaining sucient sta capacity and in particular fully managed boards.
During the investigation underlying this report, two of the three Dutch CBSEs
had vacancies in the board;
Recruiting, managing and keeping sucient numbers of volunteers to initiate
and conduct all activities that support the core objectives of the business;
Keeping the core values alive and sharing them with all sta members,
including volunteers that may lack basic skills related to running activities,
let alone a business;
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An assessment of community-based social enterprises in three European countries
2. Key characteristics and findings from the case studies
The Netherlands
Achieving financial stability; only one of the CBSEs has a strong asset base
that guarantees a stable income source in the coming years (see the section on
Business model and funding for more information);
Attracting neighbourhood residents into CBSE buildings and making the
organisation known among the residents.
2.2.3 Organisation and management
All Dutch CBSEs have chosen a ‘stichting’ or foundation legal and organisational
model as advocated by the LSA. A foundation does not endorse membership, but
requires CBSE boards to formulate byelaws and to discuss the CBSE’s objectives,
activities and performance with members of the target neighbourhood. From a
financial point of view, the status of foundation enables CEs to apply for an ANBI-
status at the national Tax Authority, registering them as ‘institutions working for a
general (public) benefit’ (Algemeen Nutsbeogende Instelling). Inspired by British
experiences, LSA (see section 1) has developed a basic organisational model
for CBSEs. While the majority of board members should be residents from the
target community, external experts can also be recruited. Two of the Dutch CBSEs
studied here struggle to fill such vacancies. Even if the board is fully manned, such
as in the BBM, managing the CBSE remains a challenge in terms of arranging
and allocating all work, especially considering the limited extent to which people
outside the core of the CBSE are willing to take responsibility;
This is exactly the problem, many people have ideas, but people do not act, who
is going to do this, and yes, it’s very uncomfortable to say to someone with a really
good idea, ‘please come here and make it so’, because they always take the view
that we or I or whoever must do that for them.Secretary of the board, BBC
In all three cases, volunteers have an indispensable role in the daily running and
management of the CBSEs, because there is usually only one member of paid sta.
2.2.4 Business model and funding
The three Dutch CBSEs reveal significant dierences in terms of their money-making
activities. They have all chosen the foundation (stichting) with an ANBI-status,
which means that donors can subtract donations from taxes, and that CBSEs can
give small (tax free) allowances to volunteers. The LSA oers new or establishing
community enterprises the opportunity to apply for a starting grant if they submit
a business plan which is approved by an external evaluation committee. Two of
the three Dutch cases have made use of this oer.
All Dutch CBSEs rent out working and living spaces from their assets to generate
an income. The CBSEs themselves rent the building from a housing association
or local government (based on a reduced rent price), or manage this asset for the
local authority. However, there are large dierences in the extent to which this
financially sustainable.
Until recently SBZ ran two community centres, including the one in which they are
based themselves. In May 2017, the local government of Zaanstad and the SBZ
jointly decided that SBZ will gradually withdraw from the community centre in
which they are based, as they can no longer aord to be there both in terms of
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An assessment of community-based social enterprises in three European countries
2. Key characteristics and findings from the case studies
The Netherlands
finance and sta capacity. This is partly because it has not succeeded in raising
sucient income from rent.
The BBC is also struggling. While it pays a low rent to the local government, it still
has to pay for utility, heating and upkeep. An unexpected threat to the business
model is the renovation of the roof of the building which is likely to be expensive.
In the BBM, the situation is completely dierent. Even though many tenants in the
‘Bruishuis’ (a former care home owned by the BBM) pay a reduced rent, the rental
income from the 130 units is sucient to pay the rent to the housing association
(Volkshuisvesting) and to cover maintenance costs. In fact, the BBM made a profit in
2016. This CBSE appears to fully match the definition of hybridity, because its social
objectives are strongly related to their financial aims; renting out the units at a
reduced cost is directly supporting their social mission.
Two of the three CBSEs carry out commissioned work for the local government.
Both the SBZ and BBC target unemployed people on social benefits and recruit
them volunteers. The local government provides funds so that these people can
be supervised by the institutions for which they volunteer. SBZ is the first CBSE in
the Netherlands to act as a sub-contractor in the so-called ‘social neighbourhood
teams’, which bring together professionals from certain disciplines to target social
problems in a specific area. The local government pays two full-time sta members
from SBZ in these teams. In addition, SBZ is also undertaking commissioned work
for housing associations, such as painting the staircases of apartment buildings.
There are significant dierences regarding the use of subsidies and grants.
For SBZ, a quarter of the total income consists of local government subsidies.
The Bewonersbedrijf Malburgen started out with a seed grant from LSA and a
subsidy from the national Doen Foundation, but now refrains from applying for
any subsidy. In contrast, the BBC pays substantial attention to fundraising and
subsidies with external grants having been their main source of income from the
start.
2.2.5 Context
The most elaborate form of Dutch CBSEs are bewonersbedrijven, which are very
specific and local forms of social enterprise that were established in 2011 (see
http://www.bewonersbedrijven.nl) by the LSA. However, there are big dierences
regarding the extent to which the three CBSEs work as part of a wider ‘eco-system’
including local stakeholders.
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An assessment of community-based social enterprises in three European countries
2. Key characteristics and findings from the case studies
The Netherlands
The SBZ has an intensive co-operation with several local government
departments. As a sub-contractor in the ‘social neighbourhood teams’ it is able
to develop a contractual relationship with these departments, which is more
business-like than simply oering support for local initiatives. The same applies
to the BBC whose board members have several points of contact within the local
government.
However, the BBM aims to limit co-operation with other partners to those actors
who either rent accommodation within the ‘Bruishuis’, or with those groups
that receive donations from the CBSE. In line with their dominant philosophy
of independence, BBM rarely seeks contact with important local stakeholders,
because it can achieve its objectives without support from the local government.
2.2.6 Accountability, representation and monitoring
All three CBSEs aim to function as a local platform that facilitates bottom-up
initiatives. SBZ emphasises its function as a connector between bottom-up
initiatives in the municipality, but like the BBC, the fact that few people are willing
to take on responsibilities is a complex issue to deal with. Again, the approach of
BBM is slightly dierent. This CBSE connects various care providers (not residents)
in one location. On the ground floor of the ‘Bruishuis, the so-called ‘care street’
hosts a number of local care organisations, the social neighbourhood team and
the neighbourhood management team of the local government. By providing
accommodation to self-employed people and associations who oer various
recreational activities, physical exercise, do-it-yourself or other social activities,
the BBM assists small businesses to make a living and serve the interests of the
neighbourhood.
According to the research literature, CBSEs are defined as independent, not-
for-private-profit organisations that are owned and/or managed by community
members, and are locally accountable and highly committed to delivering long-
term benefits to local people. Many elements in this definition are applicable
to the three case studies, but the matter of local accountability seems to be an
exception. If CBSEs should be accountable, the pertinent questions ‘to whom?’
and ‘how?’ still remain.
There are relatively straightforward procedures for financial accounting to the
national tax authority. Because the foundation (stichting) is the legal basis of
Dutch CBSEs, they are obliged to establish byelaws (statuten). Byelaws require
CBSEs to have meetings with residents to discuss objectives and activities.
However, this is a bridge too far in all three case studies, for various reasons;
Power to Change Research Institute Report No. 12 33
An assessment of community-based social enterprises in three European countries
2. Key characteristics and findings from the case studies
The Netherlands
Then you indeed need to organise residents meetings in which you give an
account of your activities and plans, but hey, people in our neighbourhood
are not interested in this at all. What we do, if we have resident meetings with
a specific theme, then we include this accounting into the meeting, but as a
very small part. In our newspapers and other publications, we are accountable
as well, but to be honest, if you read what our byelaws say about we should
actually be accountable, we are not doing that.Chairman, SBZ
The BBM has a more fundamental philosophy with regard to accountability and
involving residents and other local actors.
To anyone who wants to hear it, we tell our story. But I don’t consider that as
accountability, it’s just informing. If I am obliged to be accountable to you, that
will be legally established in advance. But what really gets my goat if you start
meddling with our policy and operational management. If you have one member
that can organise resistance, a ‘trade union leader’, then you are lost. With an
annual turnover of almost €700,000 we simply cannot take the risk.
Lead entrepreneur, BBM
While informing local residents is a clear strategy, the BBM considers this is
neither accountability nor accepts any attempt from residents outside the board
to aect the running of the business.
With all the CBSEs having clear objectives for their business, a question is to what
extent do they review their performance. The interviews have shown that they
are barely in a stage of systematically monitoring outputs. In the BBM, monitoring
is embedded in daily routines. Two caretakers, who also live in the building,
keep an eye on everything in the ‘Bruishuis’. In the BBC, all those involved are
thinking through how to evaluate, but this requires them to establish a definition of
successful performance.
2.2.7 Leadership
Both the paid sta and volunteers of the three CBSEs are well aware that all
hands are needed to keep the business running. All have objectives but also
implicit or explicit core values. The core values not only relate to the target
community, but also to the values that all sta members should adhere to, in
terms of, for example, gender equality and non-discriminatory behaviour. It
requires leadership to keep these values alive and established as a shared
asset of all sta members, but this is not easy:
It’s the concept of social inclusion… if you want to achieve something and you do
your best, then you are welcome here, and this is what we need to keep alive by
conversation. We, as core volunteers, coordinator and board members, we must
do this consciously, but it raises a challenge… especially with all volunteers who
are not really into words, reading and writing, so we have to do it in a dierent
way.Secretary of the Board, BBC
Power to Change Research Institute Report No. 1234
An assessment of community-based social enterprises in three European countries
2. Key characteristics and findings from the case studies
The Netherlands
2.2.8 Prospects for growth
The Dutch CBSEs have dierent business models and their evolution hitherto
results in significantly dierent prospects for growth. It appears that the SBZ
has reached an at least temporary ceiling regarding growth, reflecting both the
diculty of making money and limited sta capacity for both operations and
management.
In Arnhem, the BBM has reached a stable situation that provides a clear basis for
the coming years. With all rental units occupied and plenty of opportunities to fill
vacancies, this CBSE seems assured of a steady income in the coming years. A
growth area may be small-scale service provision if sucient sta or volunteer can
be engaged to take this on.
The board of BBC is grappling with a fundamental tension. On the one hand,
it fears a loss of its social objectives if the organisation ‘professionalises’ its
activities and shifts the balance towards trading and commercial activities. On
the other hand, the treasurer emphasises the need for a more “entrepreneurial,
business-like approach” (a BBC director) that brings in money to secure its future.
2.2.9 Conclusion
In the Netherlands, CBSEs are considered as a new form of self-organisation
and public management, through being self-sucient and independent from
government, while simultaneously aiming for strategic alliances with governments
and other stakeholders. While it is too early to identify a definitive CBSE model
in the Netherlands, there are many recurring challenges in relation to CBSE
practices:
Many CBSE start-ups that arise from an existing resident platform struggle with
developing entrepreneurial skills that are required to develop the business-
related components of the CBSE;
The national government lacks a clear policy framework for social enterprise
and in particular CBSEs, so there are no directions for further development of
the sector;
Despite local governments’ positive attitudes, research has shown them to
support and simultaneously resist ‘disruptive’ entrepreneurial actions from
citizens, despite eorts by collaborating agencies (boundary spanners) to
prevent or mitigate this resistance (Kleinhans, 2017);
Expectations may be too high; CBSEs are expected to develop quickly and
many stakeholders are looking for ways to achieve this. However, the growth
potential of Dutch CBSEs is limited by diculties with recruitment of volunteers
with suitable skills and experience.
The CBSE approach in the Netherlands can be considered innovative and
entrepreneurial in the sense of it managing and integrating two institutional logics
– the need to conduct trading and non-trading (i.e. social) activities in order to
keep organisations financially viable. It remains to be seen whether the majority of
recently started CBSEs will successfully navigate a way through these challenges.
Power to Change Research Institute Report No. 12 35
An assessment of community-based social enterprises in three European countries
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The Netherlands
2.3 Sweden
2.3.1 Origins and development
Two of the Swedish CBSEs, Yalla Trappan in Malmö and Roslagskrafterna in
Norrtälje, are organised as workers’ co-operatives, aiming to provide work and/
or on-site job training for people who have had diculties fitting into the labour
market. Hence, the intended beneficiaries in the two co-operatives also own the
organisation. Both cases originate from work integration projects (WISE) but wanted
to achieve a more long-term sustainable financial model. Yalla Trappans trading
activities primarily consist of catering, café, cleaning services and study visits.
Roslagskrafterna’s trading consists of cafés, a second-hand shop and repair services.
The third CBSE, Nya Rågsveds Folkets Hus (NRFH) in Stockholm, is a local meeting
space which encourages and promotes active citizenship, but also oers on-site job
training as part of their mission. It is owned by other associations and organisations
in the community. This CBSE originates from the 1970s, when a group of young
people protested against the lack of meeting spaces in the local borough. The
commercial activities are primarily renting out space, a café and a second-hand
shop. The non-profit activities target the local community and include free meeting
space for smaller non-profit organisations, advice and help to set up organisations,
and to oer a place to come together during Christmas Eve for those who are
isolated and lonely.3 The objectives of the CBSEs are to various degrees related to
work (and work experience), empowerment, integration and increased liveability.
All three cases have their roots in either the labour movement and/or the co-
operative principles, which previous research has argued are common among
social enterprises in Sweden (Gawell et al., 2014, Gawell, 2015). Within the two
largest organisations, the founders clearly stated that their experience of the
labour movement and the Social Democratic Party had an impact on how and
why they had an interest in running a CBSE.
Yalla Trappan and NRFH are situated in boroughs close to a larger city. The areas
share similar challenges with of the wider immigrant population; a high degree
of unemployment, and high levels of young people dropping out of school.
Roslagskrafterna is situated in a municipality of around 60,000 inhabitants.
A low level of education amongst the population and an above average number
of citizens on early retirement benefits4 are challenges for the municipality.
2.3.2 Defining objectives
The overall objectives of the CBSEs have stayed the same, but for Yalla Trappan
and NRFH, the largest and most experienced of the three, it can be said that the
scale and scope of their practices are changing and that they are in a mode of
transition. Yalla Trappan, with its objective to empower immigrant women with job
opportunities, is no longer as place-bound as it was in the initial stage. The women’s
co-operative has turned into an organisation with a concept and practices that can
be transferred to other places with similar problems and groups of beneficiaries.
3 In 2016, 700 food plates were served.
4 https://www.ekonomifakta.se/Fakta/Regional-statistik/Alla-lan/Stockholms-lan/
Norrtalje/?var=17256&compare=1
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An assessment of community-based social enterprises in three European countries
2. Key characteristics and findings from the case studies
Sweden
Hence, the organisation has changed from being based in a particular community
in terms of area, to entering into an idea-based community where the concepts
and practices can be introduced in other Swedish municipalities. An additional
change is the partnership with larger business actors to create more jobs and on-
site work training. In the case of NRFH, there has been a shift in aims from bringing
people into the building to that of moving the activities of the organisation out
of the building and into other spaces, for example experimenting with vegetable
cultivation.
2.3.3 Organisation and management
All three cases dier in their methods of organising their activities and legal status.
Yalla Trappan and NRFH are non-profit organisations. However, NRFH has also
transferred some of its activities into other legal structures, such as a foundation
and a limited company, to separate the dierent activities financially and legally.
This, according to one interviewee, leads to “creating flexibility and opportunity to
more easily cease activities that are not working”. For Yalla Trappan, using the
legal structure of a non-profit organisation has positive advantages – for example,
according to the chairperson, it gives the organisation credibility. Although Yal la
Trappan has the legal structure of a non-profit organisation, the CBSE defines and
organises itself as a co-operative. Roslagskrafterna, which is the smallest and
youngest case, has the legal structure of an economic foundation. However, it
defines and organises itself as a workers’ co-operative with a social aim; profits
are re-invested in the members’ organisation and local charities.
In all three cases the chairperson plays an active role in their organisations. In
Yalla Trappan and NRFH the chairpersons are also directly involved in many of
the activities. Furthermore, in both organisations the chairpersons have changed
working voluntarily to being paid. In contrast, in Roslagskrafterna the chairperson
is gradually withdrawing from daily activities and only assists in the weekly work
meeting and chairs the monthly board meetings.
2.3.4 Business model and funding
All three organisations have several income streams to ensure financial
sustainability. Little of the organisations’ revenues come from grants5 and all
stress the importance of their activities needing to be self-sustainable, or otherwise
discontinued. The cases fit the description of hybrid organisations by mixing not-
for-profit and for-profit elements (Dees, 1998; Pache & Santos, 2012). The hybrid
organisation model is particularly reflected in the co-operatives. Sometimes the
CBSEs have to refuse a member employment due to insucient revenue streams.
In one of the cases, this is sometimes handled through sharing and dividing positions
(job-sharing) if this possible. Hence, it is possible to see some of the conflicting
institutional logics that appear in hybrid organisations (Pache & Santos, 2012);
they are there to do good by including and emancipating the beneficiaries, but
with a for-profit logic. This can at times create tensions in decisions and delivery
regarding what is marketable, the level of service, price and eciency.
5The CBSEs sell on-site job training, including supervision, and define them as payments, and not grants from
the employment service agency.
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An assessment of community-based social enterprises in three European countries
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Sweden
Increased flexibility and independence are key benefits of being financially
self-sustaining compared to receiving grants, according to NRFH. On the other
hand, grants are still part of the funding model but are treated and presented
more as a platform to promote the organisation’s ideas and local activities. Being
more business-like and achieving sustainable financing is in line with the initial
conditions for setting up the organisation. Increasingly, revenues generate a large
surplus so that they can also be used to fund other projects in the local community.
2.3.5 Context
The two more established CBSEs, Yalla Trappan and NRFH, can be portrayed
as actors that have high credibility in the community and with the local councils
as well as local businesses. As such they can both initiate and/or participate in
larger commitments. One example of this is the urban cultivation experiment by
NRFH, which includes other actors, such as the city council, the business region
development organisation, commercial companies and real estate owners.
Another example is that of a new version of the Yalla Trappan model which the
municipality has requested to be set up in Malmö city centre. This enterprise is
visited by ocials from other municipalities who come to study the ‘Yalla Trappan
way’. The chairperson has also been invited to meet government ministers to
discuss matters of social enterprise in Sweden. They have also established a
business relationship with the local IKEA store in Malmö and oer alterations to
textiles for IKEA customers. This is a unique relationship since IKEA do not allow
other organisations to work in this way.
The most recently formed CBSE, Roslagskrafterna, has a close relationship
with the employment service agency and Coompanion, the business advisor
for co-operative start-ups. Coompanion has been an important contributor to
knowledge regarding business know-how for the co-operative. Roslagskrafterna
is also experiencing increased credibility within the community. This has opened
up opportunities for collaboration with the local recycling company, as well as
being trusted to take over a café that was previously operated by another social
enterprise which closed.
2.3.6 Accountability and representation
All three CBSEs have several channels for publicising their role including annual
reports, meetings, websites, interaction on social media sites and having local
representatives on the board. It is, however, only the women’s co-operative that
openly and visibly provides the opportunity for the public to become members
of the organisation. The other two are also membership-driven; NRFH only
targets other organisations, of whom the majority are non-profit-making, and
Roslagskrafterna is open for people who work in the organisation, either as
‘working owners’ or beneficiaries. Neither of them claims to be representing the
local community as a whole but stress that they are part of the local community.
They emphasise the importance contributing to the local business life in the
community, and of linking the CBSE members’ skills and knowledge, and business
opportunities, to the local market. One such example is ‘tours of the borough’
Power to Change Research Institute Report No. 1238
An assessment of community-based social enterprises in three European countries
2. Key characteristics and findings from the case studies
Sweden
that include the local shops. NRFH also uses the local community announcement
boards on a weekly basis to communicate with the community. In the case of
Roslagskrafterna, the question of local accountability and representation is related
to the members of the social enterprise and not the community at large.
2.3.7 Leadership
All the cases have a manager for each project even though each may be small in
terms of numbers of sta required. This is in line with the idea of sharing and dividing
responsibility amongst many of the members involved in the organisation. However,
it is also very clear that the chairperson in each case has a major role in setting the
organisation’s culture. They take part in some of the day-to-day activities as well as
developing the continuing strategy for the organisation. This has recently changed
for Roslagskrafterna, where the chairperson has gradually withdrawn as other
members gain more experience of running an enterprise. The members of NRFH
had previous experience of bankruptcy, and when setting up a new organisation
decided that the chairperson must have an operative role. The decision-making
process regarding member representation was also changed at this time, and
potential board members’ skills and knowledge became more important.
The entrepreneurial approach of all three cases can be described as a process
of ‘eectual reasoning’ during the set up and development the organisations
(Sarasvathy, 2008). The three cases have started with a particular set of objectives
and then allowed business goals to emerge depending on a) who they are, b) what
they know and c) whom they know. Sarasvathy (2001) describes the process as
follows: ‘Plans are made and unmade and revised and recast through action and
interaction with others on a daily basis. Yet at any given moment, there is always
a meaningful picture that keeps the team together, a compelling story that brings
in more stakeholders and a continuing journey that maps out uncharted territories.’
(p.3) For all three cases, their compelling story is the social aim that guides them,
whereas the activities from which the revenue stems are created through interaction
with their members and other stakeholders.
2.3.8 Prospects for growth
An uncertainty regarding the future of state policy outlines for work integration
social enterprises was a concern for co-operatives’ future directions and existence.
Other than that, time was the largest concern with regard to growth. A struggle for
all the cases, when looking at the work integration activities, is the sta’s ability
to increase the number of activities and/or expand the customer base. In Yal la
Trappan, which has had a growth rate of 30 per cent every year, the chairperson
argued that growing was not a priority in itself; growth needed to be related to the
members’ ideas, skills and capacity as well as a demand for the service or product
locally. In addition, the same CBSEs formulated a ‘co-operative model’ that can
be transferred and implemented in other regions in Sweden and are also growing
in this sense. As for NRFH, the urban cultivation project allows the organisation to
expand outside their original premises.
Power to Change Research Institute Report No. 12 39
An assessment of community-based social enterprises in three European countries
2. Key characteristics and findings from the case studies
Sweden
2.3.9 Conclusion
There is a consensus in Swedish research that the business communities’ for-
profit logic has had an increasing impact on the non-profit organisations’ way of
organising, executing and talking about their activities (Gawell, 2015; Berglund
et al., 2012; Stryjan, 2006; Trädgårdh, 2007; Wijkström, 2004). It is likely that an
increasing number of non-profit organisations will adopt the CBSE business model
in the future, especially if there is an increasing number of WISEs. When social
entrepreneurship is discussed in the Swedish context, it is described as being
related more to the continental European idea of the social entrepreneur as an
enthusiast for societal change who works primarily in the non-profit or the public
sphere, whereas in other cultural contexts a social entrepreneur is someone who
creates a new form of venture operating between the borders of the civil and the
private sector.
To some extent this is also demonstrated in the three cases. In Yalla Trappan
and NRFH, the women’s co-operative and the meeting house are grounded
in the context of a popular movement. NRFH is a member of an umbrella
organisation consisting of 500 similar meeting houses throughout Sweden, and
with a long history which is well-established and legitimate in the civil and public
society. The founder of the women’s co-operative has long experience from the
Workers’ Educational Association, which is Sweden’s largest adult education
association. Roslagskrafterna is set up as a co-operative where the enterprise
is democratically owned by the members, with one member one vote. And even
though it is set up as an economic association, where the members’ financial
interest needs to be their first priority, they have decided that profit must be re-
invested in local charities. According to the chairperson, the re-investment and
local charity “made it so much easier for a lot of the people to buy into the idea
of starting a business”.
These three cases were chosen because of their particular focus on social
enterprise, that is they had a clearly stated business model where trading is an
important source of revenue. In all three cases, the notion of community was not
necessarily used to describe their activities, even though their aim is to contribute
to a more inclusive society within the community. As for the concept of community
business, the approach adopted in the Swedish context is significantly dierent to
the one promoted by Power to Change in England. However there are a number
of voluntary associations and organisations that at least partly reflect the criteria
for community business, such as the co-operative businesses which do not wish to
be accountable to the community in general and rural community centres whose
enterprising activities may be only one element of their role.
Power to Change Research Institute Report No. 1240
An assessment of community-based social enterprises in three European countries
2. Key characteristics and findings from the case studies
3. Discussion and conclusions
This section discusses the key findings of the case study analysis in the three
countries. The purpose is not to provide a systematic comparison but to bring out
the specific and unique features CBSEs in each country, as well as identifying the
main similarities and dierences between them. This section follows the same
thematic structure as section 2 and ends with a number of conclusions.
While we have identified many dierences, which are largely related to variations
in the national and local context, political background and history of citizen
initiatives, many similarities have also become apparent between CBSEs in
England, Sweden and the Netherlands. Our concluding argument is that CBSEs
are a response to relative austerity in each country as well as a desire to promote
dierent forms of ‘citizen-centred governance’ (Barnes et al., 2008), while also
emerging from dierent national and local contexts. It is the dierent legal and
administrative frameworks which have a major influence on the establishment
and support for CBSEs, while also creating opportunities to deliver services and
to provide facilities which would not otherwise be available.
3.1 Origins and development
In all three countries CBSEs often start out as small-scale initiatives run by a few
entrepreneurial people who may continue to be involved for many years and
bring in others to help develop the business. For example, in England CBSEs are
often initiated in areas where there has been a history of resident involvement in
previous community programmes. In the Netherlands, many CBSEs arise in former
target areas of the national urban renewal programme, which has recently come
to an end. In Sweden, many of the CBSEs are linked to previous work integration
projects. While definitions of CBSEs (as set out in section 1) tend to emphasise the
importance of the local context, in several cases the initiators are not based in
the target area themselves whereas some CBSEs may bring specialist skills and
permit access to wider networks. The beneficiaries usually reflect dierent forms
of social inequality, deprivation and a lack of qualifications and skills.
Our case studies all identify needs that are not fully met by either the government
(at any level), the market, or by combinations of these and other actors. Hence, they
are entrepreneurial in the sense that they identify gaps in service provision and
niches in the market as well as new ways of delivering services. The identification
of needs is not only related to government withdrawal and austerity policies,
but also to levels of education, skills and other strengths of key individuals and
entrepreneurs within the organisations, who believe that citizens have an important
role to play in delivering services using methods which can be more responsive
than those delivered by government or the private sector. Hence, we perceive the
rise of CBSEs as a response to austerity policies in light of a growing commitment to
active citizenship within a strong civil society, including the desire to build more on
local strengths and expertise.
Power to Change Research Institute Report No. 12 41
An assessment of community-based social enterprises in three European countries
There are substantial dierences in levels of support for starting up CBSEs in the
three countries. Sweden provides the most extensive form of support, through
business initiators such as Coompanion, while in England and the Netherlands
support is available once an initiative has been formed at the local level.
All three countries have a dierent understanding of the definition of CBSEs,
although all recognise Power to Change’s use of the following criteria: locally
rooted; trading for the benefit of the local community; accountable to the local
community; and broad community impact.
A fundamental dierence between the organisations is associated with
the notions of ‘community’ and ‘community-based’. While ‘community’ is an
established term in both policy and scientific discourse, as well as in the public
debate in England and the Netherlands, it has no straightforward equivalent
in Sweden. The term ‘societal entrepreneurship’ is used in the Swedish context
and includes the notion of ‘community’, ‘community-based’6 and ‘local’ (Persson
& Hafen, 2014; Gawell et al., 2014; Gawell, 2015). However, the terms local,
community and community-based are more strongly emphasised when framed
in development settings in rural regions. Hence, in a more urban setting, where
the Swedish cases are located, the neighbourhood is not always stressed by the
respondents even though the cases are indeed products of their local context
and have social aims for the community.
The case studies in England and the Netherlands place a strong emphasis on
engaging with and providing benefits for ‘the community’, whereas in Sweden
this concept of the community is not clearly identified or expressed for all cases.
Instead, the benefits arising from the business are expected to accrue primarily
to the members in the social enterprises or to society in general. At the same
time, the Swedish cases use an exclusively needs-based analysis to identify
deficiencies in certain areas and among certain groups and subsequently address
these deficiencies with activities, without the need to label an area or group as
a ‘community’. In England and the Netherlands, CBSEs have been framed in
particular programmes and philosophies which are clearly influenced by a
few active organisations (Locality, Power to Change, LSA) which promote new
entrepreneurial forms of organisation that identify communities, in a social and/
or spatial sense. In the Netherlands, this contextual factor is further emphasised
by the fact that the rise of CBSEs is explicitly framed within, and as a response
to, the end of the national urban renewal policy, which focussed its eorts on a
number of top-down, pre-defined target areas. While needs-based approaches
are operating to varying degrees in all three countries, CBSEs aim first to identify
specific local opportunities and local strengths, in terms of assets or people. In
other words, the entrepreneurial ‘antennas’ respond to both negative and positive
local features. This is in line with earlier research showing that both necessity and
opportunity underlie motivations of entrepreneurs in deprived neighbourhoods, as
well as within their own locality (Williams & Williams, 2012).
6 ‘Lokala gemenskapsföretag’ is a term sometimes used by actors operating in the Swedish social economy and
is then as such direc tly linked to the term community-based enterprise as introduced in Scotland. This concept
shows great similarity to the co -operative ideas advocated by for instance Coompanion.
Power to Change Research Institute Report No. 1242
An assessment of community-based social enterprises in three European countries
3. Discussion and conclusions
3.2 Defining objectives
We found that all case studies are remarkably stable in terms of their overarching
objectives (such as empowerment, integration, aordable housing, health,
organically and locally produced food, meeting places, etc.). In all countries, the
mission statements and key objectives have not changed much over time, while
operational goals have varied in relation to the changing activities undertaken to
achieve the overarching objective(s). In all cases, the overarching objectives are
rooted in core values which are reflected within the CBSE. These core values are
manifest in dierent ways, for example, the values that volunteers have to adhere to
in order to be active in a CBSE function as a ‘code of conduct. In the Netherlands,
the BBC is establishing a simple code of conduct to make sure that all volunteers
adhere to the key values of the CBSE. The ways in which the CBSEs started, their
core values and guiding principles, are a major influence on how they develop in
future. New projects and newly acquired assets need to be seen to be contributing
to these core values and in this way all case studies can be said to be ‘path
dependent’ (Kay, 2005).
3.3 Organisation and management
All CBSEs have formed boards which are responsible for management but
there are significant dierences relating to the roles and responsibilities of
board members. In the Swedish cases, the chair of the board is legally
responsible for human resources and sta issues (although he/she might
delegate the practical work to another board member). In the Netherlands
and England, the chairperson does not have this legal obligation; any sta
member may be involved in managing human resources, but the board as a
whole remains the sole responsible legal entity. In most cases, there is a formal
allocation of responsibilities for a range of activities, but tasks are sometimes
performed by dierent sta or board members for various reasons, especially
where there are board member vacancies. In some cases, sub-committees are
formed of board members to focus on particular issues, such as longer-term
strategy, finance or recruitment of sta. In England, there is a strong tradition
of the director (or CEO) reporting to the board but also working closely with the
chairperson around strategy and new opportunities.
In all three countries CBSEs are examples of a wider trend of new forms of
organisations that emerge between the public and private sectors, but do not
always have clear boundaries and can thus be considered bridges between
sectors. As such, the amount of hybridity (Doherty et al., 2014) in such new
organisations is increasing rapidly. Likewise, in terms of the use of language
within bottom-up initiatives, it appears that ‘co-operative’ and ‘community-based’
are being used interchangeably. Both refer broadly to people getting together
to arrange matters for a certain group of beneficiaries. In England and Sweden,
where co-operative is not a legally established organisational form as in the
Netherlands, the concept captures the democratic principles of joint working
amongst community members. Hence, co-operative is predominantly used as an
adjective to reflect the way of working rather than referring to the legal institution
itself. In England co-operative suggests the shared ownership of an organisation
by those working for it, as in the case of OrganicLea.
Power to Change Research Institute Report No. 12 43
An assessment of community-based social enterprises in three European countries
3. Discussion and conclusions
3.4 Business model and funding
As mentioned in the beginning of this report, CBSEs can be considered a
particular form of social enterprise. The concept of hybridity, i.e. the pursuit
of the dual mission of financial sustainability and social purpose, is a defining
characteristic of social enterprises (Doherty et al. 2014). The CBSEs in England,
Sweden and the Netherlands all appear to span the boundaries of the private,
public and non-profit sectors. Therefore, they have to deal with conflicting
institutional logics; opportunities and challenges are dealt with in dierent ways
and according to the dierent logics of the state, market, and third sector (Pache
& Santos 2012; Doherty et al. 2014; Skelcher & Smith, 2015). For some projects or
business activities dierent management structures may be required. An example
of this is the creation of Goodwin Community Housing Ltd in order to carry
out a major housing development on a site previously occupied by the Trust’s
own oces in what was a former home for older people. Another example is the
umbrella organisation Nya Rågsveds Folkets Hus in Stockholm, which has a non-
profit structure when organising cultural and recreational activities for community
members, and uses the limited company for more commercial activities.
While all CBSEs seek a balance between trading and social activities, there are
dierences in the amount of eort put into trading activities. The same applies to
the variety of sources in funding, in particular the balance between state funding,
trading income (including commissioned work) and external grants. All case
studies are to varying degrees dependent on government or charitable funding.
For example, Swedish CBSEs are contracted to provide social services to the
government, which is the prime reason for labelling this as trading income and not
as a form of government funding (Gawell, 2015). The same applies to the Stichting
Bewonersbedrijven Zaanstad, in the Netherlands, where the local government
employs two sta members of the CBSE to perform social work in a team of
professionals.
In all countries, CBSEs generally prefer not to rely on project funding from
external sources, because it creates too much uncertainty and absorbs sta time
in making applications and monitoring requirements. Nevertheless, a notable
trend in almost all our case studies is that they rely heavily on public or charitable
grants and loans in the early years but then increasingly seek ways to increase
their trading income and thus to ensure their longer term financial sustainability.
In England, in particular, the acquisition of new assets could only be possible if
capital grants can also be secured to cover restoration of the physical fabric of
the building. In addition, an element of commercial activity is usually included
in new projects in order to cover additional costs.
This study has also uncovered dierences in how available government funding
is directed towards these initiatives. In general, there is a larger array of funding
opportunities available for CBSEs in England while there are fewer options in
Sweden and the Netherlands (see section 1). Moreover, the English case studies
have a much stronger asset base than the Dutch and Swedish cases. This is
probably because of a longer history of charitable activity and asset transfer
policies in England. The National Lottery and Power to Change in England are
also important sources of funding for community businesses and similar third
sector organisations in providing capital grants to restore buildings.
Power to Change Research Institute Report No. 1244
An assessment of community-based social enterprises in three European countries
3. Discussion and conclusions
This study has provided insights into how CBSEs instil their entrepreneurial
approaches in particularly local contexts. Generally, businesses start out on
the basis of certain aims that may, through a process called causal reasoning,
provide clear leads towards activities and instruments that help to achieve the
aims. However, we have found that CBSEs, especially those in Sweden, tend to
apply eectual reasoning. While causal reasoning usually provides prescribed
approaches towards achieving specific aims, eectual reasoning starts from
identifying what is there in terms of directly available resources and people, to
subsequently identify opportunities for the business and act accordingly and in
interaction with other stakeholders (Sarasvathy, 2001, 2008). Put simply, eectual
reasoning poses the question ‘what can we do (in business terms) with what we
have at our disposal at this moment?’ Hence, CBSEs tend to identify opportunities
through a ‘filter’ of their available resources (such as people and assets) because
they cannot easily expand their resources through loans or other sources of funding.
3.5 Context
Chapter 1 discussed the wider ‘eco-system’ of local stakeholders and national
support organisations, which appears to be a very specific to each country, but
also between local cases within countries.
Contingency theory7 (Donaldson, 2001) helps to explain how CBSE practices in
three countries are responding to the range of national and local opportunities
and available funding sources. This also applies to the willingness of local
authorities and other public and private bodies to provide support, for example
through joint collaborative arrangements. The key variables seem to be the
availability of dierent forms of capital and revenue funding, the extent of support
from government agencies and the local authority, and the ability to access new
contracts or to acquire assets which contribute towards the organisation’s social
and economic objectives. In Plymouth in England, for example, Millfields Trust has
a very good relationship with the city council which has enabled it to secure leases
of increasing length for land and buildings at below market value.
However, once CBSEs start out in a particular direction, their evolution is to a
certain extent pre-determined. While continuity is important, CBSEs also need
to be pragmatic, because it may not make sense to continue certain activities if
the associated circumstances and conditions change. However, certain choices
and internal or external events may lead to a form of ‘creative disruption’ which
changes at least part of the development trajectory and activities of the CBSE.
For example, Goodwin decided to demolish its headquarters building in order
to replace it with a new aordable housing development which it could manage
itself and thus generate an income.
Another similarity between countries relates to ‘boundary spanners’ (Van
Meerkerk & Edelenbos, 2016) in that CBSEs seek partner organisations, such
as local authorities, with which to collaborate. On many occasions during the
development process, a variety of collaborative arrangements between public
7 Contingency theory suggests that organisations respond and adapt to the environment in which they are
located, taking account of their aims, size, leadership and the range of commercial and non-commercial
opportunities available to them.
Power to Change Research Institute Report No. 12 45
An assessment of community-based social enterprises in three European countries
3. Discussion and conclusions
and private agencies have provided support in sharing costs or providing technical
and financial assistance to create a viable project. The more boundary spanners
a CBSE has, the better the chances of identifying useful funding opportunities or
partnership arrangements. For instance, In the Swedish cases there are several
such ‘boundary spanners’ on all three boards who have previous experience in the
public and/or private sector. The ability to explain the organisations’ values and
ways of operating in dierent sectors are valuable at a local as well at a national
level, e.g. the chairperson in one case was invited to explain and discuss the co-
operative’s way of doing business as well as negotiating a contract with one of
Sweden’s major furniture companies.
3.6 Accountability and representation
According to the academic literature, CBSEs are independent, not-for-private-profit
organisations that are owned and/or managed by community members, and are
locally accountable and highly committed to delivering long-term benefits to local
people (Pearce, 2003; Peredo & Chrisman, 2006; Somerville & McElwee, 2011;
Bailey, 2012; Kleinhans, 2017). Many elements in the definition are recognisable in
the three case studies, but the matter of local accountability is an exception to that
rule. In fact, we have observed that the understanding of what constitutes being
accountable to the ‘community’ varies according to how the organisation perceives
its role, its governance systems, users and beneficiaries.
The ways in which dierent community businesses define and address the need
to be accountable to dierent stakeholders is fully examined by Buckley et al.
(2017). Thus the community may simply be defined as users and people, such as
volunteers, having contact with the organisation, or in other cases residents living
in a clearly defined area. In the former, this might be described as a community of
practice rather than a community of place. In most cases accountability is practised
on an informal, day-to-day basis. The main reason for this as reported by CBSEs
is that they do not have the time, expert knowledge and/or other resources to be
accountable in systematic ways which are often prescribed by more ‘bureaucratic’
agencies. For the same reason, impact is not monitored systematically; some
CBSEs do measure outputs, but in practical, low-key ways that are embedded
in the daily routines. For example, a large part of the monitoring for the
Bewonersbedrijf Malburgen in the Netherlands is carried out by two caretakers,
who are present in the organisations’ building almost full-time.
Many interviewees from CBSEs argue that they provide needed services, and
therefore question the often externally imposed necessity to provide further
justification for what they are doing. They emphasise the importance of telling
their story, being transparent and communicating their aims and activities, to
their target groups and beyond. Some of the interviewees have described this
as public relations, image management and informing rather than accounting.
In terms of these informing elements, it appears that all case studies rely
predominantly on relatively traditional methods of communication: newsletters,
annual reports, websites, items in local newspapers, and themed meetings. Some
use social media to advertise their activities or special events.
The divergence between theory and practice is also clear in relation to the issue
Power to Change Research Institute Report No. 1246
An assessment of community-based social enterprises in three European countries
3. Discussion and conclusions
of local representation. None of the case study interviewees stated that their CBSE
represents the locality in which they are based. At the same time, CBSEs claim
that they know what local residents are thinking. Board members draw on local
knowledge through their own networks, but they do not aim to set themselves up as
representative bodies for the community. However, other local state organisations
might identify or treat them as such. This may result in contractual relations, in
which they are asked to perform certain activities as a result of being ‘close to the
community’. As for representative democracy, boards are often not democratically
elected, simply because it is sometimes dicult to find suitable candidates for a
vacancy. Case studies in all three countries reported diculties in filling vacancies
on their boards and few if any had a succession strategy to ensure a steady
turnover of board members.
All CBSEs produce annually audited accounts and reports to satisfy the formal
requirements of their legal status, as a company limited by guarantee (England),
non-profit and economic association (Sweden) or foundation (Netherlands) as well
as regular reports to funding bodies.
3.7 Leadership
In most of the case studies we have identified ‘leaders’ who can be considered
as the ‘motivating force’ of the CBSEs. These are often, but not exclusively, the
initiators, or board members that were involved in the start-up of the business.
Both in Sweden and England, Chairs (Sweden) and chief executives (England)
are driving the organisations, by being entrepreneurial and managing external
relations. In the Netherlands, the leadership varies in each local situation;
sometimes it is the chair of the CBSE, in other cases lead entrepreneur.
While the literature seems to attach importance to community leadership
(Selsky & Smith, 1994; Renko et al. 2015) which is supposed to be structured
democratically, our case studies reveal practices of leadership exhibited by
charismatic individuals, who propagate the core values or take the majority
of the decisions. Some may do this with or without consulting the board, but
usually without consulting ‘the community’. Conversely in the member-driven
organisations such as the Swedish cases the members and the representatives
of the board themselves can be considered to be the community or at least partly
so. The democratic principle of ‘one member one vote’ is still at the centre of the
decision making process which may slow decision making down.
In many cases, board members have been recruited because of their professional
skills, local knowledge or extensive networks such as in the case of residents.
In other words, CBSE are skills-driven rather than democratic representative-
driven, with the latter reflecting a situation in which board members might be
democratically elected. In reality, elections very rarely occur in the cases we
have studied because very few have multiple candidates for board vacancies.
Power to Change Research Institute Report No. 12 47
An assessment of community-based social enterprises in three European countries
3. Discussion and conclusions
Experienced volunteers can often be a good source of board membership recruits.
The Swedish cases work on the basis of a co-operative structure which allows
members to ensure good practice is followed, while in the Netherlands, this
opportunity is lacking because foundations do not have members. OrganicLea
in England has been reviewing its management structure in order to get a good
working balance between leadership by a few as well as the active involvement
of all 15 co-operative members. The challenges of collective decision-making are
not unique to CBSEs.
3.8 Prospects for growth
In all three countries CBSEs share relatively limited growth prospects. A key
cause for many of them is that they rely heavily on volunteer sta capacity, in the
Netherlands in particular, which makes it dicult to plan for the future. Moreover,
in many of the cases, volunteers have learning disabilities or mental health issues
which is part of the mission of the respective CBSEs but means eorts are required
to guide them. Another diculty is that expanding commercial activities requires
permits, compliance with legislation, and guaranteed availability of sta at the
requested times, knowing that many voluntary and/or paid sta members within
CBSEs cannot work full time. Instead a work situation that can support people
with varying levels of ability is needed.
Many CBSEs are aware that growth generates risks, even though a larger
business might help to deal with day-to-day changes in sta availability and
reduce overheads. A key strategy for growth for CBSEs is connecting with wider
networks of similar initiatives or reproducing the CBSE concept and values in a
dierent location. This strategy is applied by for example OrganicLea in England
and Yalla Trappan in Sweden. In the former case, this is called ‘replication’, whereby
the organisation itself does not grow but it assists other organisations to establish
similar working practices. This is happening in another London borough where
the local authority is willing to let a set of glasshouses which are surplus to their
requirements to a CBSE to promote similar objectives of volunteering and healthy
eating through growing locally produced food. In Sweden, Yalla Trappan has created
a co-operative model of how to set up a WISE which is being replicated in other
places in Sweden.
3.9 Conclusion
This explorative study has provided a snapshot of CBSEs in three dierent
countries, each at a dierent stage of development. Based on nine case studies,
it is neither possible nor desirable to look for ‘best practices’, a term that is all too
easily used by policymakers, nor to evaluate each one. Instead, based on the
above discussion of similarities, we can identify five broad conclusions which
are relevant to CBSEs in the three countries;
Power to Change Research Institute Report No. 1248
An assessment of community-based social enterprises in three European countries
3. Discussion and conclusions
i. Context
This study has shown how important the context is for the growth and development
of CBSEs. Many factors that determine the inception, progress or failure of CBSEs
are strongly imbedded in local social, economic and policy contexts. Nevertheless,
all the case studies apply a broadly similar hybrid business model which aims to
achieve a balance between trading and non-trading activities in order to promote
the organisation’s core values. Most of the case studies are based in areas of
relative deprivation where their activities bring considerable benefits to those
making use of the services or facilities of the CBSE. But the relatively small size of
these organisations and because they usually provide a limited suite of services
means that they are likely to only moderate but not reverse levels of deprivation
in the longer term.
ii. Asset base
Regardless of the dierences between countries, it appears that having a
strong asset base is crucial to the success and prospects for growth of CBSEs.
An asset base (for example, land or buildings) can provide a durable means
for generating an income beyond project-based time limits and uncertainties.
Asset transfer is increasingly common in England during a period of austerity,
although opportunities vary in dierent locations. In other European countries,
the perception is much more likely to be that what is owned by the state is also a
community asset and therefore the transfer to community-based organisations
is much less evident. Other sources of income, such as government funding, are
always time-limited and contract-based service provision is often short term.
iii. State support
The study has emphasised the need for the positive support of governments and
especially local authorities. However, as shown in the policy review section 1, the
social enterprise sector is still in its infancy, which aects the outcome of positively
framed discourses on this particular form of active citizenship. In Sweden, there is
a growing interest in social entrepreneurship but at the same time there seems to
be an uncertainty in how to and in which direction the national government should
promote increasing citizen responsibility. For instance, a commission requested by
the government with the purpose of investigating what actions need to be taken
to strengthen the social economy and social innovations has not been published
despite considerable interest in the outcome. The emergence and growth of social
entrepreneurship is not without criticism and it has been suggested that changing
government policies have been part of the problem (e.g. Dey & Steyaert, 2010;
Teasdale, 2011). In England, social and community enterprise have a relatively
low national profile in comparison, for example, to Scotland where there is
a national strategy linked to other programmes such as urban regeneration.
In the Netherlands, the increasing importance of social enterprise has been
acknowledged, but this has not yet aected supportive policies on various levels.
In fact, the growing role of social enterprise in the three countries may still be seen
as a threat to established interests of local authorities, who feel that they should
(and can in the future) remain responsible for various forms of service provision.
Even if local authorities are supportive, the tendency to strive for scaling up or
‘rolling out’ social innovations such as CBSEs can become “a mechanistic, mass
production perspective of service provision” (Pesto, 2014, p. 393).
Power to Change Research Institute Report No. 12 49
An assessment of community-based social enterprises in three European countries
3. Discussion and conclusions
iv. Leadership and accountability
Notions of leadership and accountability need to be reconsidered in the context
of CBSEs. As for leadership, the development of CBSEs relies on a few active
persons to make decisions at key stages in the development of the business.
The same applies to ‘allies’ in local authorities and other organisations. The
results of the case studies give reason to question the common assumption
that CBSEs should be considered as democratic in terms of accountability to
the community, although clearly most are in constant dialogue with residents
and service users. They do not formally represent the larger population, and
this is not their intention, but the activities of the organisation have an important
role in developing social capital. CBSEs struggle with the transformation from a
representative to a participatory democracy, which is evidenced by the diculty
some CBSEs face in recruiting new board members.
On the other hand, there is evidence that CBSEs are both entrepreneurial and
innovative in that they deliver services often more eectively and at lower unit cost
than many more traditional providers. Many actively engage volunteers who gain
confidence, skills and expertise which often enables them to gain employment
elsewhere. Particularly in England where asset transfer is more common, CBSEs
have demonstrated considerable expertise in identifying opportunities for land
and buildings previously written o as unusable and have created imaginative
solutions to meet local needs or to generate new sources of income. For example,
Goodwin Trust acquired a redundant church in its area which it was able to rent out
to a theatre group as rehearsal space as part of Hull’s City of Culture programme.
However, CBSEs tend to operate in high risk environments where rapid policy
or funding changes can undermine projects or threaten the whole organisation.
Increased diversification and the ability to respond flexibly to new opportunities
are essential if the organisation is to grow and prosper.
v. Similar trajectories
CBSEs in the three countries are on similar trajectories from a low-level start as
a community project, gaining an increasing income from commercial activities
over time, and at some point in the future developing a more diversified range of
services and facilities based on both commercial trading and non-commercial
funding. Thus CBSEs can be both innovative and entrepreneurial in developing
this hybrid business model which is pioneering new approaches to service delivery
as part of a larger strategy of inclusive growth (Vickers et al., 2017). Each seeks
financial sustainability but this will depend very much on the opportunities and
constraints it identifies in its locality and through developing boundary-spanning,
collaborative arrangements with others. However, central and local governments
in all three countries are often perceived as ambivalent to the forms of innovation
represented by our case studies and may appear uncertain as to whether they
should support this sector and if so, how best to do so.
Power to Change Research Institute Report No. 1250
An assessment of community-based social enterprises in three European countries
3. Discussion and conclusions
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Appendix 1: Methodology
This project was carried out by the research leads from the universities of
Westminster, Delft and Stockholm using a mixed method approach. Having
reviewed national and local policy in the three countries, a series of three CBSEs
were investigated in depth in each country making a total of nine case studies.
Access to key stakeholders was negotiated through known contacts and
organisations such as Power to Change and Locality in England, the National
Association of Active Residents (LSA) in the Netherlands and Coompanion in
Sweden. The main focus of this project is CBSEs which are often formed in areas
of relative deprivation, or undergoing regeneration, in order to provide services
or facilities to social groups or local communities which would not otherwise
have access to them.
Quantitative and qualitative research was carried out using published
and unpublished sources, and semi-structured interviews with a variety of
stakeholders. The interviews were digitally recorded, transcribed and retained
by the researchers. Seminars and workshops enabled findings to be shared and
comparative insights to be developed between countries with the assistance of
external contributors. It was agreed that the purpose of the project was not to
evaluate or make judgements about individual CBSEs but to learn from their
experiences so that conclusions could be drawn within and between countries.
The project was co-ordinated by Nick Bailey through regular Skype meetings with
Reinout Kleinhans and Jessica Lindbergh. Ethics approval was obtained from the
relevant authorities in our three universities. There were four main stages:
Stage 1:
In stage 1 we contacted key practitioners and policy makers in each country in
order to examine the parameters within which CBSEs operated. This enabled us to
write up chapter 1 which discusses the extent to which relevant policy exists at each
level as well as identifying key support and funding agencies in all three countries.
This analysis helped us select three case studies in each country for more detailed
investigation and after seeking advice from national support organisations. The
main criteria agreed in advance were: number of years since foundation; size and
type of trading and non-trading activity; location in areas of relative deprivation;
and aspects of organisation and delivery which might be transferable to other
locations. Thus the nine case studies selected represented as near as possible
the full spectrum of CBSE activity.
At the end of this stage a seminar was held at the University of Westminster in
February 2017 to discuss the findings and the wider implications. Representatives
from all three universities and support agencies from each country made short
presentations.
Power to Change Research Institute Report No. 12 55
An assessment of community-based social enterprises in three European countries
Stage 2:
In stage 2 we carried out a detailed investigation of case studies and prepared
a summary report on each one. These were based on semi-structured interviews
with a sample of employed and volunteer members of each CBSE as set out in
Table 1, as well as secondary material from reports, websites and social media.
Table 5: Policy makers and case study representatives interviewed in each country
England Netherlands Sweden
Paid employees 7 2 5
Chairs of management boards 3 2 3
Other board members 553
Volunteers 330
Members of support organisations,
other social enterprises and state
agencies
4 1 9
TOTAL 22 13 20
Stage 3:
In stage 3 a two-day seminar was held in June 2017 at the Delft University of
Technology at which the findings from the case studies were discussed in order to
identify similarities and dierences. Representatives from all three countries made
presentations as well as Ailbhe McNabola, Head of Research and Policy at Power
to Change, Peter McGurn, director of the Goodwin Trust (one of the English case
studies) and Ingmar Van Meerkerk from the Erasmus University in Rotterdam who
is also doing research on this topic.
Stage 4:
In the final stage, the three academic investigators met in Stockholm in September
2017 in order to discuss the findings and to draw out general conclusions from the
whole project. These are set out in the Discussion and Conclusions (chapter 3) of
the report.
The nine case studies were written up and draw on all sources of research data.
These are published in a separate annex to this report which is available on the
Power to Change website.
Power to Change Research Institute Report No. 1256
An assessment of community-based social enterprises in three European countries
Appendix 1: Methodology
Power to Change
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... One distinctive form of SE is community-based social enterprises (CBSE). Researchers [28,29] highlight the importance of CBSEs as an alternative self-reliant, selfsufficient business model for sustainable development. CBSEs are non-profit, independent organizations with a unique geographical characteristic, wherein community members own and operate their business to earn incomes from self-managed community-based activities that contribute to the local development and well-being of the community [30][31][32]. ...
... Bailey, Kleinhans & Lindbergh [28] An enterprise that is rooted in a particular geographical place and responds to its needs. It aims to generate profits to be reinvested in the local community. ...
... While each CBSE case may vary based on their distinctive contexts, the literature identifies several underlying common success factors in the development of CBSE. These include leadership [28,33,79], local ownership [31], community participation and partnership support from within and outside the community [80][81][82], plus benefit-sharing [83,84]. In fact, CBSE represents a transformational change from traditional top-down to bottom-up participatory leadership approaches, and an absence of necessary leadership support may adversely affect CBSE progression toward sustainability [85]. ...
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... The social innovation literature is full of examples of societal challenges in various contexts, ranging from poverty and social exclusion to environmental issues (Macke, Sarate, Domeneghini, & da Silva, 2018). In addressing gender equality and women's empowerment, some examples of social innovation are: fostering an egalitarian environment for women's involvement in organizational and local governance (Lyon & Humbert, 2012), providing affordable health technologies to women in India (Tracey & Stott, 2017), offering of employment opportunities to women refugees in Sweden (Bailey, Kleinhans, & Lindbergh, 2018), establishing community nurseries to give access to quality childcare services for disadvantaged women in the United Kingdom (Lyon & Fernandez, 2012), and building peace through women's empowerment in Uganda (Maracine, 2019). ...
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Migration to Poland has only been discussed in terms of integration needs and challenges in the last couple of years. Although the programmes dedicated to immigrant integration are a relatively new phenomenon, some non-governmental organizations, such as the Polish Humanitarian Action, Caritas or the Helsinki Foundation for Human Rights, were active in this field already in the 1990s. At that time, however, the assistance was offered mostly in the form of humanitarian aid and legal assistance. The sector of social enterprises (SEs) for a long time did not focus on immigrants as a primary target group. Although available statistics on social economy or civil society do not provide sufficient data on migrant organizations, some trends are visible. The recent and unprecedented growth in the number of immigrants living and working or studying in Poland corresponds with an increase in initiatives and programmes dedicated to this particular group. Since the Polish state has not developed appropriate immigrant-oriented social policies, the supportive role is fulfilled to a large extent by the representatives of civil society. In some cases, local governments have recently begun to create their own policies and established various forms of cooperation with SEs and other institutions focused on immigrant integration. It is a very complex and dynamic phenomenon with huge challenges lying in front of all actors involved in the support of immigrants in Poland.
... In Italy, and not only (in this regard see Bailey et al. 2018), the tendency of these actors to use public heritage to experiment practices of social innovation and new entrepreneurship, linked to local communities and resources, is clearly emerging. To cite Mangialardo and Micelli (2017a, b, p. 110) "bringing this heritage into play means rethinking the underlying role of the public heritage, facilitating the activation of a new economy and new social relations, and consequently, new value". ...
Thesis
This doctoral project intends to advance our understanding of the potential of social entrepreneurship (SE) towards sustainable development and community empowerment. While research studies linking social entrepreneurship and sustainable development (SD) are steadily increasing, in-depth and holistic investigation of if and how social entrepreneurship (SE), contributes to SD and community empowerment seems to be lacking. Therefore, the central question of this doctoral thesis is as follows: What is the potential of social entrepreneurship in contributing towards SD and community empowerment in developing economies?? To address this question, three papers were developed. Drawing on a systematic literature review and applying alternative development theory, the first paper set the disciplinary context for SE and sustainable development by identifying, synthesizing and critically evaluating the extant literature. The aim is to interrogate how and to what extent social entrepreneurship contribute to the seventeen United National Sustainable Development Goals. Paper one reveals variation of engagement by SE across all seventeen SDGs. SE seems to pay more attention on addressing problems related to SD1, SDG8, SDG3 and SDG17. The focus on SDG17 in particular reveals the importance of working in partnerships among all partners and across sectors by applying both bottom-up and top-down development approaches. These results have inspired the second paper, which aims to generate an empirically-informed picture of the extent to which SE empowers communities. The second and third paper use the context of Tanzania due to the emerging of social enterprises scholarship and practice, which has increasingly been applied in tourism sector, which is one of the key contributors to the country’s GDP. Drawing on 56 qualitative interviews in Tanzania, the second paper reveals that community empowerment is both a process and outcome in multidimensional view. Connected to these community dynamics and social inclusion function of SE, the third paper has taken the study forward by investigating the ability of SE as a vehicle for women empowerment and gender equality. The findings demonstrate there are some issues that need to be examined in-depth and that entail policy/practical interventions, particularly in developing country contexts, such as Tanzania. To enhance the capacity of SE in empowering women, a balanced approach of collaborations and partnerships among actors are essential. The key contribution of the thesis to academic knowledge lies in its ability to advance our understanding on the instrumentality of SE in empowering and enhancing the wellbeing of communities in different domains of sustainable development. Overall, the thesis provides important theoretical and practical implications for academics, policy-makers and other stakeholders in the domains of sustainable development and social entrepreneurship in general. Keywords: Sustainable development, Social entrepreneurship, Community empowerment
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Rural shrinking is an ongoing phenomenon in many parts of Europe. Against this backdrop neo‐endogenous rural development has been gaining support as a conceptual and policy approach which stress the combination of local and external actors, resources and forces for enhancing an integrated development of rural areas. Within this governance framework rural social enterprises have been stressed as potential key actors contributing to rural development. This paper explores, through 36 semi‐structured interviews with diverse stakeholders of two Irish community‐based rural social enterprises, the role of these organizations in contributing to a neo‐endogenous development. Our findings show how their mobilization of the social attachment of their members, their collective character and their delivery of tangible results have been key to develop collaborative dynamics with stakeholders from different sectors and situated at various spatial scales. Moreover, these organizations have accommodated global‐exogenous forces buffering their effects through locally‐focused solutions which address the needs of their rural communities, despite their incapacity to address the causes of these global‐exogenous trends. We conclude that rural community‐based social enterprises can play a relevant role in contributing to neo‐endogenous development, however, institutional frameworks that address the diversity of rural areas and that enhance balanced collaborations among different rural development stakeholders are a precondition to unlock their potential.
Preprint
Social enterprises are very common in Birmingham having the largest concentrations of social enterprises in the United Kingdom. With the emergence of the Covid-19 pandemic, the operations and management of social enterprises in Birmingham has been greatly affected. This study seeks to analyse the impact of the Covid-19 pandemic on the operations and funding of social enterprises in Birmingham UK. In order to achieve this, the study is going to carry out a qualitative methodology in order to analyse the impact Covid-19 has had on social enterprises. The research is going to select relevant stakeholders through a non-purposive sampling criteria identifying individuals who have direct interest in the functioning of social enterprises. The relevant stakeholders will be expected to respond to semi structured interviews that are structured to evoke responses relevant to this area of research. The research realized that Social enterprises in Birmingham are a critical player in the economy of UK with many individuals depending on the social enterprise industry. In addition to that, the study realised that the Covid-19 pandemic exposed social enterprises to various financial and market risks. Moreover, social enterprises were forced to make a change in their organizational structure through cost management changes and offering alternative services. However, the government came in support through provision of grants and funding to boost the social enterprise economy.
Book
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Recopilación de experiencias y de reflexiones entorno al papel que la economía social puede jugar en la lucha contra la despoblación y a favor del desarrollo rural.
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Using the case of Cardiff, Wales, we argue that the hybridisation of local governance forms is exacerbated by the downscaling and offloading of austerity politics. Conceptualising hybridity as a process which operates across governmental scales, at the organisational and at the individual level helps understand the growing complexities of local governance under austerity and the tensions which arise in seeking to assemble locally appropriate ideas and practices. Conceptualising hybridity as practice, we consider how ‘hybrid officers’ at the frontline experience austerity, their situated agency, and the implications for higher levels of governance.
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Many European countries are implementing austerity measures alongside trends of welfare state retrenchment. Entrepreneurial forms of active citizenship are considered as a new form of public management to fill gaps left by spending cuts and to continue neighbourhood regeneration. Inspired by British practices, Dutch citizens are trying to set up community enterprises (CEs) to provide services or other benefits for residents in deprived neighbourhoods. Based on a qualitative panel study, this article reveals supportive responses but also resistance from local governments and housing associations. Within a positive policy discourse on co-production, institutional responses often encompass forms of ‘counter-production’ that hold CEs in full uncertainty about crucial conditions for their business.
Chapter
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In Chapter 22 Van Meerkerk and Edelenbos go deeper into the concept of boundary-spanning leadership to reflect on how tensions between civic initiatives and existing political and governmental institutions can be managed. They argue that to make civic-induced interactive governance work, boundary-spanning activities on both sides of the state–society boundary are needed. By using the insights from a longitudinal in-depth case study on community self-organization in the Netherlands, they delve deeper into the boundary-spanning profiles and boundary-spanning practices of the key figures in this case. Their reflective case study seeks to ‘put a face’ on boundary-spanning leadership and to contextualize it within the research on civic initiatives. They specifically examine how the different boundary spanners, positioned in diverse institutional and organizational settings, contributed to the organizational and democratic anchorage of this community self-organization in which citizens take the initiative in developing and maintaining a specific area. In making civic induced interactive governance work, they found that boundary spanning is both a distributive and complementary activity of different boundary spanners at both sides of the state-society boundary. Based on their case analysis, they argue that complementing boundary spanning practices are extremely important in aligning and embedding civic initiatives within existing governmental institutions. Support and resources for and democratic legitimacy of civic initiatives can be built by these combined boundary-spanning practices.
Book
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European cities are teeming with new ideas, initiated by citizens, professionals and policymakers. The problem is, despite all the case studies of social innovation that exist, it is still not sufficiently understood how social innovations are linked exactly to their wider urban context. It is this gap that the book addresses. We have defined social innovations as ideas, turned into practical approaches, which are new in the context where they appear and which are marked by a high degree of risk and uncertainty, e.g. due to the specific context they meet. According to this working definition, social innovations are, in a significant way, new and disruptive towards the routines and structures prevailing in a given (welfare) system or local setting. Given that non-profit organisation often act as a force for renewal in the local context, research on social innovations is inextricably connected to the study of non-profits. In practice, innovations arise within a complex context of local discourses, policies and institutions. While there have been many case studies documenting this, few, and none in recent years, have made a hard comparative study of emerging patterns: which types of innovations in European cities and how are they linked to contexts of urban governance? A key indicator for successfully rolling out social innovations constitutes the urban governance context in which the innovative idea emerges and develops into either an organised structure or another sustainable governance arrangement, in which nonprofit organizations and/or civic engagement might play a central role. The book is one of the main scientific final products of a three-year research project on local welfare (WILCO: Welfare Innovations at the Local level in favour of Cohesion)
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We propose a novel approach to theorizing hybridity in public and nonprofit organizations. The concept of hybridity is widely used to describe organizational responses to changes in governance, but the literature seldom explains how hybrids arise or what forms they take. Transaction cost and organizational design literatures offer some solutions, but lack a theory of agency. We use the institutional logics approach to theorize hybrids as entities that face a plurality of normative frames. Logics provide symbolic and material elements that structure organizational legitimacy and actor identities. Contradictions between institutional logics offer space for them to be elaborated and creatively reconstructed by situated agents. We propose five types of organizational hybridity – segmented, segregated, assimilated, blended, and blocked. Each type is theoretically derived from empirically observed variations in organizational responses to institutional plurality. We develop propositions to show how our approach to hybridity adds value to academic and policy-maker audiences.
Book
Most social ventures cross the boundaries between the private, the public and the non-profit/voluntary sectors, and this broad involvement of actors and intertwining of sectors makes the label 'societal' entrepreneurship more appropriate. Stating the importance of both the local and the broader societal context, the book reports close-up studies from a variety of social ventures. Generic themes include positioning societal entrepreneurship against other images of collective entrepreneurship, critically penetrating its assumptions and practices and proposing ways of promoting societal entrepreneurship more widely. © Karin Berglund, Bengt Johannisson and Birgitta Schwartz 2012. All rights reserved.
Article
This article examines the historical contingency of executive power and succession in the higher education publishing industry. We combine interview data with historical analysis to identify how institutional logics changed from an editorial to a market focus. Event history models are used to test for differences in the effects of these two institutional logics on the positional, relational, and economic determinants of executive succession. The quantitative findings indicate that a shift in logics led to different determinants of executive succession. Under an editorial logic, executive attention is directed to author-editor relationships and internal growth, and executive succession is determined by organization size and structure. Under a market logic, executive attention is directed to issues of resource competition and acquisition growth, and executive succession is determined by the product market and the market for corporate control.
Article
This article explores how hybrid organizations, which incorporate competing institutional logics, internally manage the logics that they embody. Relying on an inductive comparative case study of four work integration social enterprises embedded in competing social welfare and commercial logics, we show that, instead of adopting strategies of decoupling or compromising, as the literature typically suggests, these organizations selectively coupled intact elements prescribed by each logic. This strategy allowed them to project legitimacy to external stakeholders without having to engage in costly deceptions or negotiations. We further identify a specific hybridization pattern that we refer to as "Trojan horse," whereby organizations that entered the work integration field with low legitimacy because of their embeddedness in the commercial logic strategically incorporated elements from the social welfare logic in an attempt to gain legitimacy and acceptance. Surprisingly, they did so more than comparable organizations originating from the social welfare logic. These findings suggest that, when lacking legitimacy in a given field, hybrids may manipulate the templates provided by the multiple logics in which they are embedded in an attempt to gain acceptance. Overall, our findings contribute to a better understanding of how organizations can survive and thrive when embedded in pluralistic institutional environments.