Pathways of innovation in social enterprises: an experience in Italy
| Autor | Giovanni Zonin/Rebecca Minghetti |
| Cargo del Autor | National director of Scuola Centrale Formazione and President of EVT ?Enterprise for Vocation and Transition/Coordinator of EVT ? Enterprise for Vocation and Transition |
| Páginas | 187-214 |
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The term «social enterprise» was used for the first time in Italy in the late 80s of the last century to indicate private initiatives of new constitution, engaged in the production of social services and activities to promote the employment of disadvantaged persons. However, the legislative framework of that time did not provide for a specific legal status for this kind of innovative ventures, failing to acknowledged the strong social component of their identity. Therefore, this new type of entrepreneurship initially took the form of generic «cooperatives with a social purpose», and the law then followed, simply acknowledging the status of this new economic entity and defining them as «Social Cooperatives» (L. 381 of 1991)1.
Today, the Italian legislative framework recognises social enterprises as all those private companies, including cooperatives, whose main economic activity is stable and consists of producing or exchanging goods and services of social utility or public interest.
A more precise definition of social enterprise was given in the late 90s by the EMES network (Borzaga, Defourny, 2001; Defourny, Nyssens, 2008). Shared and adopted by the majority of scholars, this definition has since been a source of inspiration for legislators who have worked to refine the legal recognition of this new form of entrepreneurship.
Unlike in other countries, where the phenomenon of social entreprises is relatively young and not yet well established, in Italy it has experienced a notable and consistent increase across all different local socio-economic contexts (by number of companies, employees, recipients, turnover, etc.), even though, as mentioned above, it has predominantly taken –though not exclusively– the cooperative form.
Cooperatives, born in the second half of the seventies in some areas of northern Italy, especially in Lombardy and Emilia-Romagna, have subsequently experienced a gradual spread throughout the country. The establishment of cooperatives form was originally related on the one hand to the need by public authorities to «outsource» services in an ever-expanding range of areas (social, health, education, etc.), while on the other to a
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strong orientation of civil society towards self-organization into associative forms. More and more often citizens, informal groups or associations promote th eestablishment of new cooperatives in order to address social needs and to integrate and innovate the public supply of welfare services.
The spread of social enterprises in Italy, as well as in other countries, has been accompanied by the approval, since the 1990s, of a series of legislative measures, which have facilitated their institutionalization. Within this specific sector of the economy, such measures have contributed to the definition of an identity that is both homogeneous and diverse enough within itself to accommodate different areas of activity and organizational as well as legal forms.
Right in the early aftermath of the Second World War and of the fall of the Fascist Regime, a Law Decree issued by the Provisional Head of State
(D.Lgs. 1577 of 1947, also known as Basevi Law, from the name of Alberto Basevi, a leader of the cooperative movement that strove for the constitutional and legal recognition of social cooperation) defined for the first time (Art. 26 ) the essence of cooperative associations, coherently with the «social function of cooperation on the basis of mutuality and without scope of private speculation» contained in art. 45 of the soon-to-be issued democratic Constitution. It is important to underline the substantial overlap between the inspiration of the «Basevi» Law and art.45, developed in the same period of time.
The «Basevi Law», however, though regulating cooperatives for the first time and thus being considered the legal foundation for the italian cooperative movement, did not address the issue of defining cooperatives in a new and unitary way in the eyes of civil law. The requirement of «mutuality», as defined by art. 26, is in fact only prescribed «for fiscal purposes».
Today, social cooperatives are an important reality both in terms of service delivery, as well as from the point of view of employment and employability. At the end of 2005, social cooperatives in Italy were 7,363, experiencing a 30% growth as compared to 2001. The total of these enterprises involve more than 210,000 workers between ‘working associates’ and employees, as well as 32,000 volunteers, and provide services to more than 3 million people for a turnover amounting to 6.4 billion euros (Istat)2.
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Social enterprises thus distinguish themselves from other forms of businesses. First and foremost it is different from traditional venture capital companies because, as it is characterized by objectives, ownership forms, legal and fiscal obligations, governance and management modalities which exclude the pursuit and maximisation of profit (monetary and otherwise). They also differ from public enterprises, because they are privately founded and managed, as well as from publicly funded service providers, because they are, for all purposes, private businesses.
The latest report on social enterprises, carried out by Iris Network3, in collaboration with Unioncamere (the network of Italian Chambers of Commerce), describes a season full of contradictions for that sector of the economy producing goods and services of collective interest and pursuing high «social impact» objectives. What emerges from the study is that on the one hand, social entrepreneurship –in particular its most consolidated form of social cooperation– is suffering the effects of the systemic crisis that the country is undergoing. This situation is exacerbated by the apparent lack of national policies promoting these social enterprises, in local contexts as well as in the international (European) setting4.
In order to analyse the evolutionary trajectories and future scenarios of the social enterprise, in addition to sharing a clear definition of this phenomenon, it is necessary to ascertain its magnitude, in terms of number of firms, employees, products/services, turnover, etc. However, because there exists no single database, it is necessary to proceed by consecutive approximations and by surveying different sources. The most accurate available data concern social cooperation specifically, which is the business model for social purposes far more widespread and consolidated. According to the latest data by ISTAT, updated at the end of 2005, we are dealing with over 7.300 companies, representing a 33.5% increase as compared to 2001. The paid employees of social cooperatives are 244 thousand, while
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34 thousand are unpaid volunteers, for a turnover of 6.4 billion Euros. The beneficiaries are more than 3.3 million citizens: almost all of them are users of social welfare, health and education services, while a minority of them –little more than 30 thousand– consists of disadvantaged workers on a job placement experience.
However, the phenomenology of the social enterprise cannot be limited to the dimension of social cooperation, however important it is. In fact, we can observe examples of other non-profit organizations operating in sectors other than social services or job placement of disadvantaged groups evolving towards more business-oriented models, as suggested by the exploratory surveys carried out by Iris Network in collaboration with Unioncamere and Istat.
Even within a yet inadequate regulatory and policy framework, at the end of April 2009, there were 501 the organizations that have taken on the new «legal status» of social enterprise»5.
Table 1. Data summary
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Social entrepreneurship has, however, reached a high level of visibility and interest from institutional, economy and finance interlocutors. A most emblematic indicator of this recent development can be found in the European Commission’s commitment, declared in its «Social Business Initiative»6, to place social entrepreneurship at the centre of the ecosystem of social and economic innovation.
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@3. Innovative dynamics
What is the common denominator between a Hungarian restaurant employing disabled staff, a Dutch company teaching to read through the use of digital devices and play-based methodologies, and a Polish cooperative placing long-term unemployed persons?
Ezio Manzini –one of the leading theorists of social innovation– would define all of them as Hopeful Monsters: individuals and groups who began experimenting with new patterns of action to respond to unsatisfied needs7–in other words, true examples of social innovation. Social innovation originates from people’s emerging needs, in response to which we are trying to find new patterns and forms of action. What drives the development of these new solutions is, precisely, social dissatisfaction, which can be located in the gap between the needs of society and available services.
The European Commission, in the Guide to Social Innovation8, identifies four key elements characterizing social innovation:
1. identifying new/unmet/inadequately addressed social needs;
2. developing new solutions in response to such needs;
3. evaluating the effectiveness of new solutions as far as met needs are concerned;
4. maximising the effectiveness of social innovations.
Who can generate innovation?
The answer is simple: any business and...
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