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Labour will create legal definition of social enterprise

As one may read today in Civil Society

It was my late colleague back in February 2008, who asking the question - What is social enterprise, wrote

"There is so far no commonly agreed definition. Is an enterprise social if it produces some sort of social benefit? If so, in that sense, many or indeed most traditional businesses for profit can be considered social enterprises. Business enterprises typically produce something of value for clients and customers, otherwise they would cease to exist as business enterprises. Earning thousands or millions of customers can by definition be considered social benefit. Social refers to groups of people, as contrasted with one person. If a company produces a product or service, it has to benefit a group of people sufficiently for them to use that product or service. Owners and stockholders benefit from financial profits gained by the enterprise. Stockholders range from individuals owning relatively large percentages of a company to ordinary pensioners relying on income from micro-investments into the company. Profits from almost any large public corporation are shared among wealthy individual stakeholders to humble, modest households who have holdings in the company through an array of mutual funds managed by government-regulated financial managers.

However, he went on to say:

The term “social enterprise” in the various but similar forms in which it is being used today — 2008 — refers to enterprises created specifically to help those people that traditional capitalism and for profit enterprise don’t address for the simple reason that poor or insufficiently affluent people haven’t enough money to be of concern or interest. Put another way, social enterprise aims specifically to help and assist people who fall through the cracks. Allowing that some people do not matter, as things are turning out, allows that other people do not matter and those cracks are widening to swallow up more and more people. Social enterprise is the first concerted effort in the Information Age to at least attempt to rectify that problem, if only because letting it get worse and worse threatens more and more of us. Growing numbers of people are coming to understand that “them” might equal “me.” Call it compassion, or call it enlightened and increasingly impassioned self-interest. Either way, we are all in this together, and we will each have to decide for ourselves what it means to ignore someone to death, or not.

There is a powerful story behind that last statement. That same month , we'd written to US goverment calling on their support in our overseas work to protect children from mafia capitalism.   

Children are left in conditions of neglect and medical ignorance, without benefit of even the most basic modern medical interventions that could reduce their suffering and give them a life reflecting human compassion that the vast majority of Ukrainian citizens want for all of Ukraine’s children, in my experience. Whether these kids live or die is of little, if any, concern to mafia.

Back 9in 2004, we'd introduced what we'd proposed as an alternative. It argued for a non dividend distrbuting business model in which 50% of profit is invested in the community with the remainder retained for growth. The business would pay a living wage according to local conditions guided by the International Covenant in Economic Social and Cultural Rights.

Profits can be set aside in part to address social needs, and often have been by way of small percentages of annual profits set aside for charitable and philanthropic causes by corporations. This need not necessarily be a small percentage. In fact, there is no reason why an enterprise cannot exist for the primary purpose of generating profit for social needs — i.e., a P-CED, or social, enterprise. This was seen to be the potential solution toward correcting the traditional model of capitalism, even if only in small-scale enterprises on an experimental basis.

Traditional capitalism is an insufficient economic model allowing monetary outcomes as the bottom line with little regard to social needs. Bottom line must be taken one step further by at least some companies, past profit, to people. How profits are used is equally as important as creation of profits. Where profits can be brought to bear by willing individuals and companies to social benefit, so much the better. Moreover, this activity must be recognized and supported at government policy level as a badly needed, essential, and entirely legitimate enterprise activity.

With hindsight, I realise New Labour saw social enterprise as what is more accurately described as social entrepreneurship, which derived funding from foundations like UnLtd, a £100 million trust fund.  .      

Later in 2008, with the collapse of Lehman Brothers the sustainability of capitalism itself was in question.

Starting with Bill Gates , followed by Richard Branson and others there were soon more new capitalisms than you could shake a stick at. The irony was that it was at the Davos Ukrainian Lunch aka Philantghropic Roundtable where they got together in 2009. Their host being one who'd donated to Tony Blair's Faith Foundation and also identified in the Death Camps, For Children series.   

“Excuses won’t work, particularly in light of a handful of oligarchs in Ukraine having been allowed to loot Ukraine’s economy for tens of billions of dollars. I point specifically to Akhmetov, Pinchuk, Poroshenko, and Kuchma, and this is certainly not an exhaustive list. These people can single-handedly finance 100% of all that will ever be needed to save Ukraine’s orphans. None of them evidently bother to think past their bank accounts, and seem to have at least tacit blessings at this point from the new regime to keep their loot while no one wants to consider Ukraine’s death camps, and the widespread poverty that produced them..”

We were in Ukraine, presenting at the Economics for Ecology conference on the threat of capitalism to our planet.   

It was in a speech last year, that

"A choice between an "irresponsible capitalism" which sees huge gaps between the richest and the poorest, power concentrated in a few hands, and people are just in it for the fast buck whatever the consequences.

And a "responsible capitalism", and this is an agenda being led by business, where companies pursues profit but we also have a equal society, power is in the hands of the many and where we recognise our responsibilities to each other.

And my case is a "responsible capitalism" isn't only fairer but we're more likely to succeed as a country with it.

Now, this is an argument I have made for the last two years, as leader of the Labour party.

And today I want to apply it to the internet and the digital age."

Note the "I" and not "we"

So where are we now  - Responsible Capitalism or Social Enterprise?

It cost years, it cost a great deal of our money, my health and my colleagues life.

Let these politicians create their own models and invest in deploying them. Then they qualify to offer definitions 

Now an ethical lightweight like Ed Milband wants to lead us, as lions mignt be led by jellyfish?.