Definition

Social enterprises(SE) can be defined as companies and organizations, which creates benefits for society. Those companies are reinvesting a main part of profits to development of the society or environment. Thus the primary purpose of the social enterprise is not to obtain a return on capita or pay dividends. There operates over 2 million social enterprises in the European Union area, which employs totally over 11 million people. The operation of social enterprises is based on national or EU legislation. There are several types of companies, which are categorized as social enterprises, basis on the purpose of activity.

SE Types in Europe

Co-operatives are enterprises and associations, which are jointly owned by private persons. The aim of the co-operative is to achieve common goals in economic, social or cultural field. A co-operative has democratic structure of administration; each member has one vote and decision-making is based on the democratic majority. The co-operative invests profits to common interest, which supporting its objectives. In the Europe Union, co-operatives are working for instance in agricultural and forestry industries.

A mutual enterprise is an autonomous association of legal entities and natural persons. The primary purpose of the mutual enterprise is to satisfy common needs. The main difference compared to a co-operative is that the mutual enterprise operates with own funds, not with share capital. The mutual enterprise is typical form of business in insurance markets in European Union.

Associations are typically group of natural persons or legal persons working together as voluntarily. Associations have open membership and equal voting rights for its members. Associations are important services providers in sports, a voluntary work, a healthcare and social services. Associations offer services especially for elderly people and children, but they are also important recreation channels for all people in society.

Foundations are bodies operating with own capital. A foundation can share capital for different purposes, based on own criteria. They are operating with help of management board. Typically foundation supports international development, or national and local projects. The foundation provides funds to students, elderly people or voluntary work, and that is how it concludes benefits for society.