Social enterprise: action plan

Plan reasserting our long-term vision of social enterprise at the forefront of a new wave of ethical and socially responsible business in Scotland.

Stimulating Social Enterprise

In the last three years we have seen a continued growth in the number and variety of new social enterprises forming. Across Scotland, social entrepreneurs and enterprising communities are taking on social and environmental challenges in increasingly creative ways. We are committed to creating the conditions where thousands more citizens from all backgrounds can find out about and start social enterprises in the places they live, work or study.

Summary Of Key Actions

During the next three years we will:

  • Double our funding to £2m over 3 years to ensure that by 2024 every school child will have the opportunity to engage with a social enterprise project in their school career, introducing the benefits of the social enterprise model to young people across Scotland.
  • Invest an additional £1.5m to build on the successful programme of support offered through Adapt and Thrive which helps community organisations wanting to diversify their income streams.
  • Create the conditions where place-based social enterprise activity and communities can flourish, through enhanced promotion, developing capacity, and funding.
  • Build on wider changes in consumer behaviour accelerated since the pandemic, supporting new initiatives that inspire and encouraging more entrepreneurs across Scotland to consider the social enterprise approach.
  • Support new opportunities to unleash the passion of Scotland's social innovators through a new £30m loan fund, supporting pioneering solutions and alternative delivery models
  • Work with sector partners and national agencies to enhance the national ecosystem of support for new-start social enterprises and a pipeline of support throughout their journey.

Social Enterprise Opportunities For Young People

Scotland's Social Enterprise Strategy set out our ambition to ensure social enterprise learning is available to the next generation of social entrepreneurs. This recognises the enormous potential of children and young people as powerful agents of change in their communities.

Under the previous three-year action plan we have supported The Social Enterprise Academy to develop an Education programme that has made considerable progress in engaging with over 850 primary and secondary schools, as well as new initiatives in further and higher education.

The unprecedented economic and educational shocks of the Covid-19 pandemic have placed the situation of young people into sharper focus. In 2020, we introduced a Young Person's Guarantee[12]to ensure that within two years, every person aged between 16 and 24 will have the opportunity to study; take up an apprenticeship, job or work experience; or participate in formal volunteering. Without such measures, the unemployment rate among young people in Scotland was believed likely to increase to more than 20% due to the impact of COVID-19 on our economy.

Between now and 2024 we will invest £2m to ensure that every school child will have the opportunity to engage with a social enterprise project in their school career at least once. Our young people are an important asset to Scotland now and for the future, and through social enterprise we can protect them against long term negative effects of the pandemic. We will do this through:

  • Doubling the financial support for the phased implementation of social enterprise education activity, to reach every school in Scotland.
  • Enabling the progress of new initiatives in universities and colleges, to ensure institutions are receiving the best possible support to graduate the next generation of social entrepreneurs.
  • Embed social enterprise into youth enterprise, citizenship, and employability programmes, as part of a pathway towards economic opportunity for young people.
  • Test ways to introduce social enterprise activity into youth work in Scotland, in order to reach aspiring social entrepreneurs.

Through this combination of measures, we will enable Scotland's young people to creatively and compassionately engage with issues that are important to them and their community, while building transferable skills and unlocking career opportunities within the social enterprise sector.

Stimulating Place-Based Social Enterprises

The Scottish Government has adopted the Place Principle [13] an approach to enabling local areas to respond to issues and circumstances in the ways which work best for them, and of improving the impact of combined resources and investment in local communities. It is in these local communities that people from all backgrounds and circumstances work together on enterprising initiatives.

The Place Principle is a vital tool to support our social enterprises and create the conditions where place-based social enterprise is actively promoted in communities and can flourish, particularly in our most deprived communities. Putting the principle into action means:

  • Investing an additional £1.5m to build on the successful programme of support offered through Adapt and Thrive which helps community organisations wanting to diversify their income streams
  • Recognising the enormous potential of small, locally-accountable enterprises in local public policy-making, procurement and service delivery;
  • Encouraging multi-agency support for social enterprises through local social enterprise strategies and plans;
  • Actively promoting the potential for social enterprise activity in ways that are most effective in reaching local people and organisations;
  • Ensuring adequate encouragement and support is available to bring forward new social enterprise ideas; and
  • Celebrating the achievements of local communities that are driving forward the successful development of social enterprise.

As part of our commitment we will work with sector partners to support innovation in the promotion of, and support for, place-based social enterprises. We will build on existing initiatives, including our Investing in Communities Fund, Community Wealth Building commitments and other activity such as Buy Social and the recently published A New Future for Scotlands Town Centres[14]. Thriving towns are vital for economic and social wellbeing and social enterprises can look to be a vital part of this collaborative community ecosystem.

Social enterprises already provide an important driver for community wealth. In all areas we will work with partners to ensure the contribution of social enterprises is central to social and economic development and wellbeing.

In particular, Community Wealth Building is an important approach that seeks to foster community economic development in a way that is responsive to local needs and provides the opportunity for a greater contribution from place-based social enterprises. To support Community Wealth Building we will provide an additional five hundred thousand pounds to help community third sector organisations to diversify their income streams through entrepreneurial activity. This will be money generated locally which in many cases is invested back into the communities in which they are based, helping communities to have more control of their local economy.

Inspiring And Mobilising Entrepreneurs

Scotland CAN DO [15]embodies a collaborative ecosystem approach where sustainable growth and innovation go hand in hand with wider benefits to all of society. There is a rising tide of evidence to show that business for good is good for business and this is increasingly recognised by the business community, the business support network and by investors. Under the Scotland CAN B[16] programme we have worked with partners to raise awareness and understanding of wider societal impact within businesses and to embed consideration of impact in our business support measures.

The importance of entrepreneurs in improving social and environmental outcomes cannot be overestimated. For example, we know that many entrepreneurs have pivoted their business operations this year to support essential health supply chain work to tackle COVID-19.

We want more entrepreneurs in Scotland to consider the wider impact of their businesses and business models. We will therefore work across government and with national agencies to enable new initiatives that inspire, mobilise and support entrepreneurs to have a positive impact on society and the environment. Social enterprise will be at the heart of this values-based approach to business in Scotland.

Enabling Social Innovation

There were already many significant social and environmental challenges facing Scotland, all of which require continued, arguably enhanced innovation on the part of our public services and institutions. The Covid crisis has added to the challenge, requiring the public sector to adapt and change rapidly and embrace new ways of working.

We have explored complicated challenges from new angles, bringing people together from different sectors to apply their talents and ideas, and introduced creative thinking to design and deliver services. There are many tried and tested approaches to encouraging this type of social innovation – for example; public and social innovation labs, challenge prizes, civic innovation districts.

Given the success we have had so far, we will look to further explore the range of possibilities, and new opportunities to unleash the passion, pioneering solutions and alternative delivery models of Scotland's social innovators, entrepreneurs and enterprises. The end result we seek is - public services that are more inclusive, sustainable, and effective in improving people's outcomes.

Supporting New Social Enterprises

As set out in Scotland's Social Enterprise Strategy, our ambition is to provide the national ecosystem of support that helps to find, fund, and support social entrepreneurs to bring their ideas to life. This has a renewed focus, given the societal and economic shock from Covid-19, which effects will be long lasting. Social enterprises have changed business models, quickly adapted their delivery of social impact, and are well placed to keep adapting to continue in leading the way in creating a fairer, more inclusive country.

Since 2011 the Scottish Government has funded Just Enterprise[17] (a free national business support programme for social enterprise) to deliver the Business Support for Social Enterprise contract. Just Enterprise secured a new contract in 2019, for an additional 4 years, the Social Entrepreneurs Fund, and a range of other intermediaries and programmes that have provided a first port of call for new social enterprise activity.

Within the scope of this action plan we will work with partners to enhance the national support available to new-start social enterprises. We will:

  • Continue to offer start up advice, workshops and learning through Just Enterprise, as part of a coherent ecosystem of business support for social enterprise.
  • Directly support the Social Entrepreneurs Fund, enhancing its ability to stimulate and showcase pioneering new ventures and its targeted impact on pressing social issues as well as Scotland's response to the climate emergency.
  • Encourage initiatives that enable social entrepreneurs to connect, learn, bring forward ideas and start new social ventures.
  • Ensure adequate and focused support for those ambitious start-ups with the potential to break new ground and achieve impact at scale.
  • Work with national agencies, including Business Gateway, to integrate with mainstream ecosystem as appropriate
  • Encourage new social ventures to commit to adopting fair working from the outset.

As part of, and influencing, the wider ecosystem of entrepreneurship support, we will continue to ensure that support for start-up social enterprises remains effective.

The last Social Enterprise census also showed that we still need to do more to support greater inclusion in social enterprise development. We must respond effectively based on the evidence and understanding of barriers for people from protected characteristic groups. To support this we will establish an equalities baseline across Third Sector Unit supported activity and prioritise a focus on social enterprise. This will build upon the last census and take into account the effects of the pandemic. With stronger evidence we will be able to ensure key delivery partners deliver a Social Enterprise Capacity Building Programme, providing prioritised support for those facing the greatest barriers to inclusion in social enterprise development.



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