Social Entrepreneurship at heart of EU Social Innovation Agenda

1. What kind of Social Agenda for the Western Balkans? Social Entrepreneurship at heart of EU Social Innovation Agenda Msc Zdenka M. Kovač NOVUM, Institute forstrategic aplicative research,Ljubljana Sarajevo, 25-26 May, 2011

2. Keytopicsofpresentation • EU 2020 and SOCIAL INNOVATION • SOCIAL ENTREPRENEURSHIP IN EU AND OECD • SOCIAL ENTREPRENEUSHIP IN SLOVENIA • TOWARDS REGIONAL NETWORKING FOR SOCIAL ENTREPRENEURSHIP

3. Theglobalcrises - opportunityforchange European societies are facing profound economic and social transformation externally coused by economic globalisation and climate change and internally by demographic pressure and social developments! The need for “Social innovation” promoted through EU 2020 Agenda, represents EU Commission respond

4. Threedevelopmentprioritiesfor EU • Smart growth • Sustainable growth • Inclusive growth

5. 5 targetsforthe EU in 2020 1. Employment • 75% of the 20-64 year-olds to be employed 2. R&D / innovation • 3% of the EU's GDP (public and private combined) to be invested in R&D/innovation 3. Climate change / energy • greenhouse gas emissions 20% (or even 30%, if the conditions are right) lower than 1990 • 20% of energy from renewables • 20% increase in energy efficiency 4. Educationand skilling up • Reducing school drop-out rates below 10% • at least 40% of 30-34–year-olds completing third level education 5. Poverty / social exclusion • at least 20 million fewer people in or at risk of poverty and social exclusion

6. Inclusive growth To foster economygrowthbydelivering economic, social and territorial cohesionpolicieswithfollowingtargets: • 75% employmentrateforwomenand men aged 20-64by 2020– achievedbygetting more peopleintowork, especiallywomen, theyoung, olderandlow-skilledpeopleand legal migrants • bettereducationalattainment – in particular:– reducingschooldrop-outratesbelow 10%– at least40% of 30-34–year-oldscompletingthirdleveleducation (or equivalent) • at least20 millionfewerpeople in or at riskofpovertyand social exclusion

7. Howwillthe EU boostinclusivegrowth? 2 flagshipinitiatives: 1. Agenda fornewskillsandjobs • forindividuals– helpingpeopleacquirenewskills, adapt to a changinglabour market and make successfulcareershifts • collectively –modernisinglabourmarkets to raiseemploymentlevels, reduceunemployment, raiselabourproductivityandensuringthesustainabilityofour social models 2. European platform againstpoverty • ensuringeconomic, social andterritorialcohesion • guaranteeingrespectforthefundamentalrightsofpeopleexperiencingpovertyand social exclusion, andenablingthem to live in dignityand take anactive part in society • mobilisingsupport to helppeopleintegrate in thecommunitieswheretheylive, gettrainingandhelp to find a jobandhaveaccess to social benefits

8. Theneedfor social innovation It is becoming evident that exiting economic and social development models need innovation as existing tools are not sufficient for achieving set targets! Technological and economic innovations are not enough anymore, social innovation is becoming a MUST!

9. What is social innovation in EU context? • Social innovation refers to profound changes of the way social (prevailingly public!) sector is developing and solving social problems • It is about innovating ways to meet so far unmet social needs by innovating all three sectors public, private for profit and private non for profit (CSO’s) • It is about skills innovation, regional/local governance innovation, eco-innovation…….. It is about transformation of social transfers policies into social investment policies!

10. Social entrepreneurship as keytoolfor social innovation Agenda • Social entrepreneurship though essentiall part of so far EU economic model for decades, is now becoming the heart of EU Social Innovation Agenda • The research show the main “added value” of social entrepreneurship in its abbility to stimulate profound “social and economic transformation” by using entrepreneurial tools to meet social objectives!

11. Social enterprising “Social enterprising is thus innovative business model to meet both economic and social objectives and significantly contribute to labour market integration, social inclusion and economic development. Social Enterprises are in the core of social innovation!” (Noya,OECD 2009)

12. Social economy/entrepreneurship in EU • Social entrepreneurship/social economy in EU includes: cooperatives, associations, foundations , mutuals and more new form of “social enterprise” (limited liability company not profit oriented). • In EU it contributes 10% of GDP and around 11 million jobs. • It operates in almost all sectors of economy

13. KEY EU Policies to boost Social entrepreneurship • Social economysince last year is officialspecific part of EU Single Market, defined in thenewSingle Market Act • To boostitsgrowth EU Commissionwill: • FurtherdevelopEU legal Frameworkfor EU cooperatives, associationsandfoundations • Promote Social businessinitiativethroughfacilitationofsociallyinnovativecorporateprojectslike:social rating, ethicalandenvironmentallabeling, revisedpublicprocurementrulesandnewregimefor social investmentfunds • Introducenewcorporategovernancemechanisms • Designnew set ofmeasureswithinallDGs to supportsocio-economicinnovationthrough social enterprising

14. Social enterprising in OECD • In several OECD countries a new social entrepreneurs are emergingoutofclassicfor profit orientedentrepreneurs like Bill Gates, Oprah Winfrey, JeffSkoll, Jamie Oliver,Bill Drayton…. • Social entrepreneurshiptodayrepresents a consolidatedandgrowing trend in most OECD countries! • OECD suggestimmidiatepolicyactionthrough: • facilitationofthedevelopmentofsocial investment market placeto support social entrepreneurs • adoptionofevaluationmethodssuch as Social Return on Investments • Developmentofspecificskill’s poolformanagersof social enterprises

15. Social enterprising in Slovenia (1) In Slovenia like in all ex-YU countries, all forms of social economy exists but are significantly lagging behind EU average, contributing only about 2-3% to GDP and around the same percentage of jobs (mainly in agri- cooperatives, companies and sheltered centres for disabled) Untill lately this sector was not recognised as important part of socio-economic development! Support environment was tottaly missing!

16. Social enterprising in Slovenia (2) • After 15 years of struggle finnaly in March 2011 new LAW ON SOCIAL ENTREPRENEURSHIP was adopted, promising NEW ERA for Social Economy in Slovenia! • NEW STRATEGY for promotion of social enterprising is expected to be adopted by the end 2011! • NEW LAW on workers and social cooperatives is to follow new Parliamentary initiative! • Social enterprising is becoming FLAGSHIP THEME in media and through promotion events!

17. Law on social etreprenurship • Introducedefinitionof social enterpreneurship in SLO context • Introduce open model of social enterprisingallowingall legal formsfromsocieties, privateinstitutes, foundations, mutuals, cooperativesandlimitedliabilitycompanies • they are to followmainprinciplesof social enterprising as definedbyLaw: • market basedprivateinitiatiative, • privateownership, • governancebased on one member one vote (not dependant on capitalshare), • social and/or environmentalobjectives, • profits are reinvestedfordevelopmentofenterprise, • combinationofemployeesandvoluntaryworkforce, • solidaritybetweenmembersandemployeesandwithcommunity

18. Law on social entrepreneurship • Introduce two types of social enterprises: • A- social enterprises delivering general social and eco benefits for the community through specific products and services. Law defines primary sectors where they can operate! • B- social enterprises with main focus on social and work integration of vulnerable groups, status and specific support obtained in case of at least 40% of placement and jobs created for vulnerable groups!

19. Specific register andspecificpoliciesrequired • Law introduce specific registration and monitoring proceedures • Law requires from the governnment within 6 months after adoption of the Law to deliver Strategy and specific policies of various ministries to promote social enterprising • Council for social entrepreneurship comprising governmental and nongovernmental members is to be set up as main driver and monitoring body!

20. AmbitioustargetsfortheStrategy • Within next 5 years to reduce the GAP betwen EU average in terms of jobs created through SE sector, which means • Development of support environment for social enterprises to create betwen 50 -70.000 new jobs in Slovenia within next 5 years.

21. Networking for social entrepreneurship in the region • Sloveniankey SE relatedactorshavestarteddevelopingcooperationwithRCC to start Networkingfor Social Enterprising in theregionfacing same “transitionalmindandpolicy” gapsby: • bringingtogetherongoingfragmented CSO networks , organizingtheminto transparent andsustainblemutuallearning platform, • startingcooperationamonggovernments, employersandunions in theregionfocused on social enterprisepromotion, Thussignificantlycontribute to New Social andEconomic Agenda in theregion!

22. First stepstowardsregionalnetworking • First concept paper on regional networking lounched and well accepted at the international conference on social entrepreneurship in Ljubljana in April this year • RCC will follow up with organizing special regional meeting on Regional Social Enterprise Agenda on 19th of June this year.

23. Se forsustainabledevelopmentoftheregion • LET THE SOCIAL ENTERPRISING AND REVITALISATION OF COOPERATIVE BUSINESS MODEL BECOME CORE INNOVATION OF NEW SOCIAL AGENDA FOR SOUTH EAST EUROPE! • THANK YOU FOR LISTENING!