3rd EMES International Research Conference on Social Enterprise (Roskilde, 4-7 July 2011) !

What does the debate on social innovation add to the debate on social enterprise ?

The issue of governance

Marthe NYSSENS (UCLouvain) Roméo SHARRA (UCLouvain)

1.  Three major conceptions of SE

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3.  What is at stake ?

OVERVIEW

1. Three major conceptions of SE (Defourny, Nyssens, 2010)!

The “Earned Income” school of thought The “Social Innovation” school of thought The EMES approach

The "“Earned Income” school of thought!

1. Early version: the “Commercial Non-Profit” approach

•  It focuses on earned-income strategies for NPOs •  Social enterprise: « any earned-income business or strategy

undertaken by a nonprofit to generate revenue in support of its social mission »

2.  Later version: the “Mission-driven business” approach

•  Social enterprise: “any business that trade for a social purpose”

In line with Ashoka’s promotion of social entrepreneurs, social innovation processes are characterized by:

•  Systemic nature of innovation

•  Emphasis on outcomes rather than on incomes

The “ Social Innovation” school of thought

In the public and the academic debate, both schools seem to converge to identify social entrepreneurship dynamics

•  social innovation •  earned income and business methods •  Any kind of legal forms: for-profit, nonprofit, public body •  Social impact enlarged to blended value creation

The “EMES” approach! An «"ideal-type"» social enterprise defined by!•  An economic project!

–  A continuous production with some paid work!–  An economic risk!

•  Primacy of social aim !– Limited profit distribution!

•  A participatory governance!–  A high degree of autonomy!–  Stakeholders’ involvement !–  A decision-making power not based on capital ownership!

•  This « governance » pillar appears as a specificity of the EMES approach!

•  The EMES insistence on specific governance structures rather than on the mission driven behavior of the social entrepreneur: !–  reflects the quest for more economic democracy !–  a "signal" allowing public bodies to support social

enterprises in various ways!

2. Social innovation

"social innovations are social both in their ends and in their means" !

Bureau of European Policy Advisers (2010), social innovation as part of the Europe 2020 strategy!

Social Innovation as an outcome !

“ Innovative activities and services that are motivated by the goal of meeting a social need and that are developed and diffused through organizations whose primary purposes are social” (Mulgan, 2007)

“A novel solution to a social problem that is more effective, efficient, sustainable, or just than existing solutions and for which the value created accrues primarily to society as a whole rather than private individuals” (Phills, 2008)

•  Innovative activities (products, services, models) !•  With an explicit aim to solve a social problem!•  Primacy of social aim!

Social Innovation as a process!•  Complex network of partnerships between

various stakeholders blurring the traditional boundaries between sectors!

“In most cases the success of the innovation will rest on the participation and involvement of a wide variety of interests – the users and beneficiaries of the innovation as well as the producers and suppliers” Murray et al. (2010)!

•  Participatory and empowering processes with a specific place for beneficiaries!

“Some of the most effective methods for cultivating social innovation start from the presumption that people are competent interpreters of their own lives and competent solvers of their own problems” Mulgan (2007)

« Users seem to play a crucial role, by becoming involved and empowering themselves” Alvord et al., (2003).!

•  Local development perspective!«…"innovation in the social relations between individuals

and groups in neighborhoods and the wider territories embedding them” Moulaert et al. 2005

3. What is at stake ? •  Social value as an outcome : at the core of any definition in the field of social entrepreneurship and social innovation!•  Specificity of governance structure, absent from two (dominant) schools of social entrepreneurship, is at the core of the analysis of social innovation and the EMES approach!•  The social innovation debate is an interesting channel to promote the debate about governance which is central in the EMES approach ? !