What is a social enterprise?

Social enterprises are businesses that trade to tackle social problems, improve communities, people’s life chances, or the environment. Just like any other business, social enterprises make their money from selling goods and services in the open market, but they reinvest their profits back into the social aims of the business or the local community.

Social enterprise is a diverse community and the more-than-profit approach is used by a huge range of organisations, of every size, operating in every corner of Scotland and in most sectors of the economy. According to the recent Social Enterprise in Scotland Census 2017, there are 5,600 social enterprises in Scotland, 599 of them formed in the last two years.

There's no one legal definition or form of social enterprise, they come in all shapes and sizes – mutual co-ops, housing associations, development trusts. There’s probably a social enterprise running a shop, art gallery, sports centre or cafe in your local area. Well-known examples include the Big Issue, The Wise Group, Divine Chocolate and the Homeless World Cup. The main thing is they have what’s called an “asset lock” which ensures all profits are reinvested back into the business.

In Scotland, the social enterprise community has set down the values and behaviours by which we recognise each other. We refer to this document as a voluntary code of practice – or simply the Code.

If you are still unsure if your idea is a social enterprise, visit our FAQs page, case studies section or visit the Social Enterprise Scotland website for further information.