Social enterprises are businesses that trade to tackle social problems, improve communities, people’s life chances, or the environment.  They make their money from selling goods and services in the open market, but they reinvest their profits back into the business or the local community, they split it 50/50.  And so when they profit, society profits. 

The term ‘social enterprise’ came about from recognition that in the UK and across the world, there were organisations using the power of business to bring about social and environmental change without a single term to unite them.

Since the term started being more widely used in the mid 1990s, there has been a lot of discussion and sometimes confusion about what social enterprise is.  At Social Enterprise UK we feel we must be clear but pragmatic when it comes to defining social enterprise.  Here are what we believe are the characteristics of a social enterprise.

SOCIAL ENTERPRISES SHOULD: 

• Have a clear social and/or environmental mission set out in their governing documents
• Generate the majority of their income through trade
• Reinvest the majority of their profits
• Be autonomous of state
• Be majority controlled in the interests of the social mission
• Be accountable and transparent