by Heather Burns
What is Social Enterprise? Good question. Let's begin with what it's NOT. Social enterprise goes beyond the traditional non profit structure, while maintaining a core commitment to positive social impact. It also differs from a non profit structure by allowing entrepreneurs who start up SEBs to earn a return on their investment by selling the company for a profit.
ReSet (Social Enterprise Trust) is a Connecticut-based organization born out of CEO, Kate Emery's journey to transform her own for-profit business, The Walker Group, into a social enterprise. ReSet is a memberhip organization that strives to educate, inform and inspire a culture of social enterprise in and around Connecticut.
When remembering her own business transformation, Kate says, "There were many changes that needed to be made - some very easy, but others very difficult – like dismantling our traditional sales commission structure and replacing it with a salaried approach. Some changes were straightforward and bold – like determining that all distributed profits would be split equally between the community, employees and the investors, and some were more subtle and difficult to pin down - like implementing policies around transparency and participative governance."
So what makes a Social Enterprise Business (SEB) different from another type of business?
According to a new bill HB 5466, "An Act Concerning Social Enterprise Business," currently under review in Hartford, the SEB designation means a company:
- must be mission-based, and this mission must be for social benefit, and be spelled out in the by-law;
- needs to plow at least 20% of any distributed profits back to the mission;
- needs to disclose the compensation of the highest earners;
- can not return to a traditional for-profit status, and if it is to be sold then the assets will go to another SEB or a nonprofit with a similar mission.
For more information about how you can get involved in the Social Enterprise movement in and around Connecticut, contact Kate Emery, KEmery@socialenterprisetrust.org or call 860.674.9023.