What is a social enterprise?

A social enterprise (in Finnish yhteiskunnallinen yritys) is a company or an organisation whose primary business objective is the promotion of social good. ARVO liitto  – the Finnish Association of Social Enterprises defines a social enterprise by five aspects.

1. The purpose of the company's business is to promote a social goal: e.g. social, health/well-being, ecology, employment, culture. The purpose is stated in the guiding documents.
2. The company operates in a market and a significant part of its revenue comes from the sale of services or goods.
3. The company is independent from the public sector, i.e. it has an autonomous management and an operational activity.
4. The company uses its profits primarily to promote social goals.
5. The company's operations are based on ethical guidelines. The company is transparent and complies with good governance.

The social enterprise is not limited to any form of company. In addition to a limited company, it can be a cooperative, a foundation or an association running a business, for example.

Activities of a social enterprise are driven by maximising impact – not profits

Like all business activities, social enterprises must be economically viable. Income must be at least equal to expenditure. But instead of maximising profit, it is driven by maximising impact.

However, there is no standard definition of a social enterprise either in Finland or worldwide. A social enterprise is not a form of business recognised by law, but a business model.

According to The Centre of Expertise of Social Enterprise (in Finnish Yhteiskunnallisten yritysten osaamiskeskus, YYO) there are around 3000 social enterprises in Finland.

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Are you interested in social entrepreneurship? Support is available

ARVO – the Finnish Association of Social Enterprises is a network, advocate and expert for social and value-based enterprises.

The Centre of Expertise of Social Enterprise (in Finnish Yhteiskunnallisten yritysten osaamiskeskus, YYO) is a project to improve the business opportunities for social enterprises, strengthen networks and promote the employment of people who are partially employed or otherwise in a difficult labour market situation. The YYO website provides a lot of information, training and webinars on social entrepreneurship. It is well worth having a look at least:

• Change maker's workbook/ Muutoksentekijän työkirja (pdf in Finnish), which gives concrete instructions and exercises for developing social ideas.
• The business model canvas for a social enterprise (pdf in Finnish)
• Webinar videos (in Finnish) on YouTube about social enterprise