News and views

On the fifth anniversary of the first lockdown, academic research shows that social enterprises not only survived during the pandemic - they thrived. Professor Richard Hazenberg and Dr Claire Paterson-Young from the University of Northampton explain.  At the five-year anniversary of Boris Johnson’s lockdown announcement in March 2020, there remain many questions as to the impact of the pandemic on the country’s economy and society.  One area that we still know relatively little about is the impact that the pandemic had on social enterprises and their ability to serve their communities.   Social Enterprise UK research in 2021 found that social enterprises proved resilient, retaining staff and having lower closure rates than other forms of business. But our team at the University of Northampton’s Institute for Social Innovation and Impact (ISII) has now found that social enterprises performed even better than previously thought.  With our new research, we found that not only were social enterprises resilient, but they also grew their turnover and increased staff numbers. Despite the challenges of operating during a pandemic, they also increased the number of people they were helping.   We looked at the financial performance and social impact of 1,507 social enterprises both before and during the height of the pandemic, covering the years 2019-2022.  It used data from the Social Enterprise Support Fund (SESF), delivered by Big Issue Invest and partner organisations, through funding secured from the National Lottery Community Fund.   Misson makes for resilience   Our analysis revealed that in the three years between 2019 and 2022, social enterprises in the sample increased their turnover by 28% and their profits by 89%. As social enterprises, those profits were largely reinvested into their social missions, supporting the groups and communities hit hardest by the pandemic. Not only did the financial statements make for good reading, but staffing levels and the number of beneficiaries supported both rose by 11%.   Moreover, these figures did not come at the expense of trading income. Whilst there was an increase in grant funding, overall proportions of trading income barely changed (-0.7%), illustrating that increases in turnover was balanced between both income streams (grant funding accounted for just over one-third of turnover increases).   How did the sector achieve this during a time of such immense challenge? It should perhaps not come as a surprise, as previous studies during earlier crises (such as the 2008 financial crash), have shown that the nonprofit sector tends to be resilient.   As part of our research, we held interviews with 17 social entrepreneurs and 16 stakeholders from the wider social enterprise ecosystem. These revealed that, for social enterprises, their inherent hybrid focus on both financial and social missions aided their reactions to the pandemic.   Indeed, it was their social focus, commitment to their communities, and ethical approach, which alongside their ability to problem solve and reshape their offers, allowed them to continue to deliver support. Community support offered by social enterprises was significant in reducing isolation, including the delivery of support to enable people to access technology, expansion of counselling for children, and online educational provisions.  It was therefore the multi-mission focus that lies at the heart of social enterprise approaches that supported this resilience.  Lessons to learn from   What does this mean for the social enterprise sector and those seeking to support it? Our sample is not illustrative of the social enterprise sector as it did not contain many micro social enterprises. The data also only runs through to 2022, so doesn’t determine how the organisations developed through the remainder of the pandemic and beyond.   However, the data does show that focusing on both financial sustainability and benefiting communities can prove an asset for organisations, at least when reacting to crises. Supporting more businesses to improve the integration of social mission at strategic levels and critically assess their community operations can support not only their resilience and sustainability but deliver wider economic and social benefit.    Perhaps most importantly, the data shows that social enterprise proved resilient and focused on delivering for their communities, despite the many challenges faced. As the UK faces ongoing challenges in public services delivery, spending cuts, and social tensions, support to allow social enterprises to expand further is vital, not least as a protection measure against the next big crisis.  The full, open access paper with the complete findings of the research, can be found here.  This article is part of SEUK’s Social Enterprise Knowledge Centre University Network – to find out more please contact research@socialenterprise.org.uk

Social enterprises present a great opportunity to improve life in the UK. Now a group of MPs will collaborate to help realise their potential. Patrick Hurley, MP for Southport, explains why he wanted to chair the group.  In my constituency of Southport and the wider area there are many social enterprises, cooperatives and community businesses delivering vital public services, community cohesion, innovating products and services and generating employment and inclusion. Businesses like these are powerful as they offer real value for people and planet and many do so at scale. They offer a fast-track solution to improving life in the UK for millions. Yet they still represent just 5% of UK businesses.  There have been numerous false dawns for social enterprises over the past twenty years. So much so, that any new attempt to create a buzz around the concept is likely to be greeted with a raised eyebrow and a knowing smile. Much more pragmatic, then, to accept that the path to a social economy is a gradual one, a path that accepts the reality of a mix of business structures, a path that is not paved with gold, but which is covered with a thicket of brambles needing to be cleared.  Late last year, as a relatively new MP, I was elected to be the new Chair of the All-Party Parliamentary Group (APPG) for our sector - a group we chose to call the Social, Cooperative and Community Economy APPG - and have since been working to develop a programme of work and an approach to growing the capacity and potential of the sector in the current economic and political landscape. Working closely with others in both the Commons and the Lords over the last couple of months on our plans, we’re now keen to make tracks on our agreed priorities for the year.  The business and governmental context that the social economy sector works in has changed fundamentally over the past couple of decades; indeed, it has changed fundamentally more than once. The availability of finance on a patient basis, the ability to trade while fulfilling community interest requirements, the need to step into the gap left by retreating public services - all these factors and more have evolved, and impacted the way social economy organisations go about their business. The time is therefore right to see if the regulatory systems, the legislative environment, and the funding landscape are what the sector needs for the next 10-15 years.  The UK is home to a robust ecosystem of support networks that encourage innovation within the social enterprise sector. From accelerators to mentorship programmes and collaborative hubs, these resources help early-stage social entrepreneurs navigate the complexities of scaling their impact while staying true to their core values. By fostering a collaborative environment, the UK has become a hotbed for social innovation, leading the way for other nations to follow suit. But there is always more we can do, and the APPG committee is determined to help grow the sector in a way that hasn’t been possible in recent years.   As we look ahead, it is clear that the future of business in the UK should increasingly be shaped by social enterprises. As the government makes decisions on public service delivery and as local government begins to rebuild after a prolonged period of austerity, it’s an opportune time for the sector to step up once again to help shape the future of the UK’s business landscape and tilt it in a more social direction. 

What is it, who’s in it and what will they do? Everything you need to know is here. What is the APPG? The Social, Cooperative and Community Economy All-Party Parliamentary Group (APPG) has been created to increase understanding and support of diverse, mission-led business models (social enterprises, co-ops, mutuals, employee-owned and community business etc). As the name suggests, it will work to address issues important to building a more inclusive economy and try to influence legislative change so that diverse mission-led businesses can reach their potential. APPGs are informal cross-party groups that have no official status within Parliament. They are run by and for Members of the Commons and Lords, though many choose to involve individuals and organisations from outside Parliament in their administration and activities.  Social Enterprise UK provides the Secretariat for the APPG. We assist the chair and officers of the group with APPG administration including meetings and AGMs, develop and deliver work plans, and manage communications for members and stakeholders. Who’s in it? Chair of the group is Patrick Hurley, the first Labour MP for Southport. Patrick previously worked as a councillor for Liverpool City Council for 12 years and ran the city’s Social Enterprise Network. Vice-Chair Baroness Thornton, one of the founders of Social Enterprise UK, is a long-standing social enterprise and cooperative expert who worked in the Department of Health and Social Care when Gordon Brown was PM and now sits in the House of Lords. The group also has two officers - Josh Babarinde, Liberal Democrat MP for Eastbourne, who formerly ran the social enterprise Cracked It, and Conservative The Lord Balfe, a former Political Secretary of the Woolwich Arsenal Co-operative Society who served in the European Parliament. A growing number of parliamentarians have joined and expressed interest in the group and wish to be kept informed of its progress. You can find a full list here. What will they do? In addition to arranging visits for APPG members to meet social enterprises, coops and community businesses, the group will run two inquiries over the coming months. The first will look at how Labour’s manifesto commitment to grow diverse business models, such as social enterprises and coops, is being delivered, exploring past and planned government activity and the wider context for growth in terms of capitalisation, routes to market and ecosystem support. A second inquiry will explore public services provision and the role for social, cooperative and community business within it. The APPG will also host a Parliamentary reception in June, as part of work to raise awareness in Westminster of the work and contributions of social, cooperative and community business. If you’d like more information, please email appg@socialenterprise.org.uk

Supplying services to the government or intending to? Here’s everything you need to know about the government’s new Procurement Act and how it will affect you.  Many of our members supply goods and services to local and national government, which is why the Procurement Act 2023 finally coming into force on 24 February is big news for social enterprises. The government is telling us that “the rules that shape how public bodies buy goods and services will change,” so if you’re a supplier or aspire to be, read on. We’ll tell you what’s changing, what you can do to prepare for it and why this is good news.  What is the new Procurement Act? According to the government, the new Act will simplify bidding and negotiating for contracts with the public sector by introducing a more flexible process that will reduce bureaucratic barriers for social enterprises. Payment will be more prompt, with 30-day payment terms on more contracts being promised, and suppliers can also expect feedback on their tenders from public bodies.   Key to this slicker way of working will be a new central digital platform, which is being positioned as ‘an enhancement to the existing Find a Tender service’. Registration will be simpler, and you’ll be able to store your core business details, making it easier to share your information with contracting authorities and use it for multiple bids. If you’re interested to see the new platform, the section below tells you how. All public procurement opportunities will be visible and searchable, and you’ll also be able to set up alerts, making it easier to stay aware of relevant available tenders.   The Act also promises a new regulator to ensure everyone plays by the new rules. The slightly Orwellian sounding Procurement Review Unit (PRU) will ‘enhance public sector procurement practice by ensuring adherence to the Procurement Act and safeguarding public procurement from suppliers deemed to pose risk’. Should you feel you were treated unfairly through the procurement process, the PRU will be the people to speak to, including anything to do with late payment.   How to get ready for the changes The government has done a good job in providing lots of resources to help you prepare for this new procurement process. It’s put a wealth of written information at your disposal, but also a library of 'Knowledge Drop' videos, as well as the training materials they are supplying to public sector buyers. You can find links to all of these on the government website. If you can set aside an hour, this video gives an overview of the new Procurement Act, along with key benefits and a demonstration of the new central digital platform. Join one of our practical webinars  We’ll be hosting a series of webinars to support organisations make the most of the opportunities being created by the new procurement landscape. 13 March, 12-12:40pm – Support for social enterprises Join our Deputy CEO, Charlie Wigglesworth, who’ll run through the key requirements for social enterprise suppliers. This webinar will be taking place in our Members’ Area and SEUK members will be sent a sign-up link in advance. If you’re not a member but would like to find out more, please fill out this expression of interest form. 12 March, 11am-12pm – Support for government suppliers VCSE Crown Representative, Claire Dove will run through the governments plans to increase spend with social enterprises and charities, providing practical examples and advice. 11 March, 12-1pm – Support for local authorities This webinar, explicitly tailored to local authority commissioners, will outline why it is important to involve social enterprises in the commissioning process. Why is this an opportunity for social enterprises?  The government has prefaced the Act going live with a National Procurement Policy Statement (NPPS) which provides transparency to the expectations they have of commissioners.   In it, it’s particularly pleasing to see recognition that social enterprises “are more likely to generate diverse and thriving local economies, creating jobs and economic growth”. Even better, that the number one requirement for economic growth in the NPPS is to “maximise procurement spend with small and medium-sized enterprises (SMEs) and voluntary, community and social enterprises (VCSEs)”.  Read our full response to the NPPS. Overall, we see the new Procurement Act and accompanying statement as a good direction of travel towards our aim of all public sector procurement creating social value. If you’re interested in knowing more about this, you can read about our Social Value 2032 Programme.

Social Enterprise UK welcomes the publication of the government’s National Procurement Policy Statement (NPPS), which recognises the power of public procurement, and how social enterprises “are more likely to generate diverse and thriving local economies, creating jobs and economic growth".  The new Procurement Act, launching on 24 February, will mean the biggest change to public procurement in a generation. It is particularly pleasing to see the NPPS recognise the value of voluntary, community and social enterprises (VCSEs). The number one requirement for economic growth in the NPPS is to "maximise procurement spend with small and medium-sized enterprises (SMEs) and VCSEs".   As the national voice for social enterprise, we have long been building the evidence and making the case for procuring goods and services from businesses with a social and environmental purpose. The Future Economy Alliance, led by us, called for public sector procurement to give greater consideration to purpose, use of profits, paying taxes and employment practices. The NPPS does just that.  We also welcome the government’s commitment to mandatory targets for spending with voluntary, community and social enterprises from April 2026, something we've long called for.   However, we note that this applies to direct spending only. Given that nearly 50% of government spending with SMEs is indirect, we hope the government will consider applying these targets to all procurement (direct and indirect) in future. From our work on the Buy Social Corporate Challenge, we know that there is a genuine appetite from large business to work with VCSEs in their supply chains.  We would like to thank Claire Dove CBE DL for her work as VCSE Crown Representative driving public procurement to create social value, and to Georgia Gould and the Cabinet Office team for their leadership.   Our organisation has worked with 12 central government departments in the past three years to benchmark their VCSE spending. We look forward to supporting more departments and agencies in the future to achieve fairer and more sustainable use of taxpayers’ money that delivers the greatest economic and social value.  

The government has announced that a Social Impact Investment Advisory Group will ‘review existing work on impact capital ... and provide views on the long-term future and direction of this work.’   As this comes hot on the heels of Lord Adebowale’s recent report into social investment, this should be welcome news. There’s only one problem: they’re not talking to social enterprises – the customers for social investment – about it.  To try and address this oversight, we’re publishing an open letter to the government pointing out some of the flaws in social investment uncovered by the Adebowale Commission and offering to work with them, connecting them with social enterprises to talk to as part of their work.   Our open letter Dear Chief Secretary and Secretary of State,  As representatives of social enterprises across the UK, we were interested to see the promise of a new Social Impact Investment Vehicle announced in the Autumn Budget, which we hope can support the Labour government to deliver on its key missions.  As you will be aware, social enterprises work in every sector of the UK economy. Government figures report 131,000 social enterprises, with a collective turnover of £78 billion and employing around 2.3 million people. These businesses are growing local economies, delivering high quality public services, running creative arts and leisure services, hospitality and restaurants, cleaning, recycling, clean energy and waste management businesses.  We know that investment can be a powerful tool which enables mission-led businesses to thrive – evidence tells us that social enterprises which receive investment experience higher growth and make an even greater contribution to our economy and society.  Yet too often over the last decade, the promise of social impact investment has failed to reach its full potential. This is especially true for marginalised social entrepreneurs.  In 2023, while 40% of social enterprises did not think the finance available to them was suitable, this number rose to 51% among Black-led social enterprises. Similarly, while 60% of social enterprises reported that financial barriers were impeding their growth, 71% of Black-led social enterprises felt this applied to them.  We were particularly pleased to see, therefore, that the new Social Impact Investment Advisory Group will review existing work in the field and provide views on the long-term future and direction in this area. We hope the Advisory Group can play a deliberate role in reducing these inequalities and ensure social entrepreneurs from all backgrounds have access to flexible, sustainable finance.  To ensure that this new impetus does not replicate the existing inequalities found within social impact investment, it is critical, therefore, that membership of the Advisory Group is balanced by those with less power in the market. We urge you to engage not only with existing investment providers and financiers, but also with those on the demand side - with social entrepreneurs, with those who struggle most to attract finance, and with those who have yet to see the benefits of shared ambitions.  We would like to support you with the development of a new, shared direction for the future of social impact investment – one which engages with social enterprises up and down the country and from all backgrounds, and which can unlock the potential of those who are often left behind by existing initiatives.  We would be happy to recommend social entrepreneurs and social enterprises to engage with as part of the Advisory Group, and throughout their work, to ensure this new impetus addresses imbalances in the social impact investment field and delivers inclusive economic and social value in support of the government’s missions.  We want to see mission-led businesses work hand in hand with your mission-led government to deliver sustainable social and economic impact across the UK. We look forward to supporting your work further and welcome the opportunity to meet with you at your earliest convenience.   Yours sincerely,  Bethan Webber, Colin Jess, Chris Martin, and Peter Holbrook  CEOs of Cwmpas, Social Enterprise Northern Ireland, Social Enterprise Scotland, and Social Enterprise UK 

The man who went up against Nigel Farage in the 2024 general election will now be making the case for social enterprise to politicians.  Taking on a media savvy political operator with more than twenty years experience in a general election when you’re just 27 years old is not for the faint-hearted. So it was no surprise that Jovan Owusu-Nepaul’s selection as the Labour candidate up against Nigel Farage for the Clacton seat raised a few eyebrows.   Perhaps unsurprisingly given his public profile and many years in politics, Farage won with 46% of the vote but for Owusu-Nepaul, it was an opportunity to add to his political experience.   Having joined the Labour Party whilst studying for his A Levels, he went onto become the youngest ever Chair of the Lewisham Deptford constituency Labour Party and then worked under Vidhya Alakeson, who is now Keir Starmer’s Chief of Staff. All of which will stand him in good stead as he takes on a new challenge of ensuring parliamentarians and policymakers are aware of the importance of social enterprise to British society as our new Head of Public Affairs.   “All the work that I've ever done has been about some form of social change or social impact. Working for the Labour Party was one way I could do that, and now this feels like a meaningful, tangible way in which I can try and advocate for a certain type of economy, making the case more concretely for an alternative way of business,” said Owusu-Nepaul.  He’s particularly eager for conversations about how government can better hold businesses to account, using the social enterprise sector as an example of an alternative way of doing business which can exist at a larger scale. As someone who has spent a lot of time thinking about what we value as a society and ways to embed a value structure into the economy (beyond the bottom line), he’s also looking forward to our forthcoming Social Value Leaders' Summit.  Owusu-Nepaul sees social enterprises as a tool to achieve social justice because he believes they give people agency in society, are nurturing to their communities and create beneficial social outcomes.   He added: “Social enterprises are so much more effective than just having business as a kind of raw parasitic form. They’re demonstrating an alternative value system within the context of a more inclusive model of capitalism, and that is exactly where political parties should be focusing because it integrates economic interests alongside social and cultural interests.”  As someone who was the exact opposite to Farage in so many ways, not only on policy but as the only black candidate under 30 in the election, his selection was irresistible to the media. It’s lead to invitations to appear on LBC, ITV’s Good Morning Britain and Channel 5’s The Jeremy Vine Show, and he’s enjoying having a platform.   “You can engage in kind of a national conversation, and you can plant ideas in people's heads as to how an alternative society could look. It's really important to demonstrate to people that the way things are today, that doesn't mean that's how it always has to be. The media's allowed me to do that,” said Owusu-Nepaul. 

More diversity at leadership level could mean more money for the economy. Our latest report found that social enterprises are playing their part – particularly those led by women.  Whatever your views on the diversity of Britain's workforce, there's a good reason to consider the findings from our last State of Social Enterprise report: it's been estimated that better gender and ethnic diversity in executive teams would be good for the economy.  For example, the business charity Business in the Community has worked out that race equality could boost the UK economy by £24 billion per year, which works out at an incredible £481 million a week. For anyone interested in economic growth like this, our deep dive into diversity amongst social enterprises should make for interesting reading.   Beyond the bottom line, more diversity can help stimulate a culture that draws on the experiences, perspectives and knowledge of different groups. Embracing different views and nurturing talent, while combatting biases and prejudices that can hold a business back, can contribute to a better business culture and enhance performance. When we interviewed more than 700 social entrepreneurs, their answers around the diversity of their businesses were incredibly revealing.  Social enterprises lead the way when it comes to representation on staff and leadership teams. More social enterprises are led by women and people from ethnic minority backgrounds than is the case for the wider business community. More than half of social enterprises are run by women (59%) and they’re making more than double the money of their male counterparts; average reported profits among women-led social enterprises are £160,000 compared to £70,000 by those led by men. For comparison, in the wider business community, just 18% of SMEs are run by women.   Another result that leaped out from the report is that one in every 20 businesses run by someone from an ethnic minority background in the UK is a social enterprise. Social enterprise leadership is closer to representing the national ethnicity makeup of the UK than the rest of the business world. The UK’s last census (in 2021) found that 18% of the population is from an ethnic minority background and our research found that 13% of social enterprise leaders identify as being so. In the wider business community, just 6% of leaders are from an ethnic minority background.  Social enterprises strive to address different social challenges and lead the way when it comes to representation on staff and leadership teams. Further, a substantial proportion actively tackle issues of gender and racial discrimination as their core social mission.  While there are several reasons to be optimistic about the contribution social enterprises make to a more diverse and representative workforce, challenges remain. As with all businesses led by women and people from minoritised groups, there remain concerns that certain social enterprises can face persistent barriers that hold their business back. The Adebowale Commission on Social Investment, for example, found that Black-led social enterprises faced a disproportionate struggle to access and secure financial support from social investment firms.  Black female-led social enterprises are significantly less likely to raise finance sought than the average, and female-led social enterprises are less confident that their organisations have the required skills to secure finance and investment.  It is critical that we improve our understanding of the challenges experienced by different groups within the social enterprise community. Through improving diversity and representation across social enterprise, economic gains can be made, and the ability of social enterprises to recognise and meet the needs of the communities they serve can be strengthened.   This report explores data collected by the Social Enterprise Knowledge Centre – in particular the State of Social Enterprise, the largest UK survey of social enterprises. It maps the demographic profile of social enterprises and explores differences in performance and experiences for women-led and ethnic minority-led businesses.  We’d really love your help with the next State of Social Enterprise, which we’ll be compiling this year. In February we’ll be launching our biannual survey, which is open to all social enterprises. It will give us more valuable data to help showcase the difference social enterprises are making. If you’d like us to send you the survey, let us know here.