Lack of political support is major barrier for European social enterprises, latest European Social Enterprise Monitor finds
The third edition of Social Enterprise Monitor launched today in Davos by Euclid shows social enterprises want better public funding schemes and more social procurement from governments.
A lack of political support is a barrier for more than two thirds of European social enterprises, the latest European Social Enterprise Monitor reveals.
Of the 1,800 European social enterprises surveyed across 31 countries, nearly 70% considered there was no, very low or low political support for social entrepreneurship. This echoes findings from the first European Social Enterprise Monitor which was published in 2021.
The biennial survey, now in its third edition for 2023-24, is produced by Euclid Network, which represents social enterprises in Europe, with support from the European Commission, SAP, Google.org, Bertelsmann Stiftung, ImpactCity, the World Economic Forum Global Alliance for Social Entrepreneurship and the Schwab Foundation.
It was launched in Davos during the World Economic Forum annual meeting, at a fringe event hosted at Social Innovation House organised by Catalyst Now (formerly Catalyst 2030) An executive summary is currently available and the full report will be published soon.
Social enterprises in particular pointed to a lack of public support schemes (for 41% of the sample), too complex public financing (50%) and a weak lobby for social entrepreneurship (40%). They rated the ecosystem in which they operate at 39 out of 100.
Johanna Mair, professor at the Hertie School, Murali Nair, senior project manager at Bertelsmann Stiftung, and Neven Marinovic, president of Euclid Network, at the launch event of the report in Davos
Measures that policymakers could take to better support social enterprises are the creation or improvement of public funding schemes dedicated to social enterprises (backed by 61% of the sample), having a specific tax scheme (64%), and more social procurement from public bodies (53%).
This puts into question the success of the European Social Economy Action Plan, launched in 2021 to support the social and solidarity economy in the union, which introduced a number of recommendations to solve those issues.
However, Toby Gazeley, policy lead at Euclid, pointed out that the measures outlined in the plan might not have trickled down to social enterprises on the ground yet, because it took time for national governments to apply them in each country. “If something's happening in Europe, it’s often not seen and not very accessible to the end social enterprise,” he says. “I think with the national strategies, maybe it will improve.”
Inclusivity – or entrenched inequality?
Among the social enterprises surveyed, more than 40% said that people with a migrant background (46.5%) or a disability (43.5%) were represented within their organisation. However, two-thirds of social enterprise employees held a university degree, suggesting that social enterprises don’t employ people of all educational levels.
Women are a majority at all levels of the organisations surveyed, including in leadership – but that’s not necessarily positive.
Women fall into the trap of actually paying themselves less. And there’s something that we need to correct here
Speaking at the launch event, Johanna Mair, professor of organisation, strategy and leadership at the Hertie School, Berlin, said: “Not only are there more women in this sector, which is underpaid, as we know, but there is also a higher rate of women leading social enterprises… So that’s great news, you would think. But then, if you scratch a little bit further, what we also found, [is that] these organisations pay themselves less at the C-suite. Basically women fall into the trap of actually paying themselves less. And there’s something that we need to correct here.”
Innovation and tech
European social enterprises see themselves as innovative, with 87% reporting they have adopted at least one innovation; but just 23% of the respondents say they’re engaged in technological innovation – which makes it a potential area for major progress, the report points out.
Mobile apps and artificial intelligence are the most commonly used advanced technology tools among social enterprises, although a majority of respondents said this type of technology was not relevant to their business or impact model.
The European Social Enterprise Monitor 2023-2024: key findings
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Top image: Freepik
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