On the vertical axis each enterprise / organisation is categorized by the primary aim of the enterprise. The dimensions range between social purpose on the top and commercial purpose at the bottom of the axis.
On the horizontal axis each enterprise / organisation is categorized by its ownership. On the left side the ownership lies with the public authorities whereas on the right side the ownership lies with private people.
• How to locate your business in the social enterprise compass:
|
The horizontal axis
|
As mentioned above the distinctive feature is the ownership of the enterprise.
Is it private?
Def.: The term “private industry” contains all economic activity that deals with the capital of one or many private owners with a view to making profits. The capital owners bear the risk.
Or is it public?
Def.: The term “public authorities” contains all economic activity where the public authorities possess the capital on either European or federal or regional or local level. That includes all nationalised and public industries.
It might be difficult for you to decide if your enterprise is merely private or public as sometimes it’s inconclusive. So here are a few questions to help you. Answer each question by putting a cross in the “private” field or in the “public” field: |
| |
| private | public |
| Who is the owner of the enterprise? | | |
| Who bears the risk? For which parts? (risk of the investor vs. risk of the management) | | |
| Who assumes the liability? | | |
| What arrangements exist for reinvestment of the profit? (Are you autonomous in your decisions on the reinvestment? – private / Are you bound by instructions in your decisions on the reinvestment? – public) | | |
| Is the enterprise autonomous in its decisions or is it dependent on someone outside, e.g. a sponsor? (Autonomous – private / bound by instructions – public) | | |
| | | |
| Look at your answers and see where the majority of your crosses are: in the “private” or in the “public” column. According to this result put your cross on the x-axis. Not many enterprises are a hundred percent public or private but by now you should have found out who plays the bigger part in your enterprise, the public authorities or the private investors. |
| |
| |
The vertical axis
|
To learn where to locate your enterprise / organisation in the social economy compass you must consider the following three features: The social purpose is the primary object of the enterprise.
On the vertical axis you have reached the top if you fulfil these criteria:
|
| |
| A Ethical concept (core definition for enterprises /organisations of the social economy) | This core definition is the ideal of an enterprise/organisation. Only enterprises/organisations whose ideal is a clearly defined ethical concept belong to the social economy.
| B Mission (key identification)
| The primary object of the enterprise is the improvement of the life situation and the chances of disadvantaged people as well as social cohesion and support.
| C Social economic creation of value and appropriation of earnings (qualitative key identification)
| The profits and the resources are verifiably reinvested for the benefit of disadvantaged people. | If the criteria A to C are totally fulfilled you can locate your enterprise / organisation on top of the vertical axis.
| The last criteria is not definitional but a describing feature:
| D Intermediary function
| Social enterprises/organisations have an intermediary function between public and private.
|
|
| |
The commercial purpose is the primary object of the enterprise
If none of the criteria above is fulfilled or the primary object of the enterprise is the commercial purpose then you must locate your enterprise on the bottom of the vertical axis.
The location between social and commercial purpose
If the criteria above are only partly fulfilled the enterprise is located between the top and the bottom of the vertical axis according to its self-definition.
|
