CREATING AN ENABLING, SUPPORTIVE ENVIRONMENT FOR THE SOCIAL ENTERPRISE

SECTOR IN IRELAND

Submissionto:TheIrishLocalDevelopmentNetwork

Producedby:

DrBrigaHynesKemmyBusinessSchoolUniversityofLimerick

June2016

AcknowledgementsThe author acknowledges the valuable input of Oliver Herbst(Oliver.Herbst@ul.ie) inpreparingthisdocument.His insightsandcommentary,informedbyhis researchon thesocialentrepreneurship sector,haveadded totheunderstandingofthedynamicsofthesocialenterprisesector.Wewouldalso like to thankall theparticipantswhocompleted the survey forthisstudy.

Authordetails:DrBrigaHynes,KemmyBusinessSchool,UniversityofLimerick

Email:Briga.Hynes@ul.ie Telephone:061-202619

FOREWORDAs Chairperson of the Irish Local DevelopmentNetwork (ILDN), I amdelightedthatwenowhaveasignificantpieceofresearchsuchasthis,whichconfirmsthevaluablerolethatLocalDevelopmentCompanies(LDCs)playinsupportingsocialenterprisesintheircommunities.As local enablers forour communities, eachofour49 LDCmembershaveandcontinuetoplayanimportantroleinsupportingthedevelopmentoftheirarea.The concept of creating an enabling and supportive environment for socialenterpriseisnotatheoreticalconstructbutarealitybeingdeliveredbyLDCsonan ongoing basis. This report confirms that LDCs are playing a central role increatingand supporting socialenterprises,which in turnareprovidingaviableplatform to deliver services and products where market conditions such asgeographywillnotallow.The maintenance of services to marginalised communities through the socialenterpriseconstructhasanessentialcommunityvalueinthatitstrengthensthesocialcohesionthatiskeytobuildingsustainablecommunities.Settingupasocialenterpriseisnotwithoutitschallenges.Thisreportidentifiesanumberoffinancial,legalandotherareas,suchasdependenceonvolunteersforrunningabusinesswitha commercialdimension. This iswhere LDCshaveandcontinue to play a key role in supporting the proper management of theseorganisations.Thesesupportsarenotoftenrecognised,butthisreportprovidesthe empirical evidence and analysis of the enabling role of LDCs for the socialenterprisesector.Finally, Iwould like to thankDr BrigaHynes of KemmyBusiness School in theUniversityofLimerickforherwork,aswellastheILDNSocialEconomyWorkingGroup for overseeing thedevelopment of this important report on the role ofLDCsinsupportingsocialenterprisesinIreland.MariePriceBolgerChairperson,IrishLocalDevelopmentNetwork(ILDN)

ExecutiveSummarySocialenterprises in Irelandoperateacrossawiderangeofbusinesssectors, inurbanandruralaswellassociallyandeconomicallymarginalisedlocations.Theyvary in size from small independent operators to larger community-basedenterprises.Although they are important drivers of social, economic and environmentalchange, it isnoteasytodemonstratethemanybenefitsthattheyprovide,asameansofvalidatingtheirexistenceandjustifyingsupportforthem.However,theresultsofthisempiricalstudy,involvingrepresentativesof20LocalDevelopment Companies, provide insights into the contributions of the socialenterprisesector,thechallengesencounteredinarrivingattheirsocialmission,and the supports required to start and scale social enterprises in a moresuccessfulmanner.Theprimaryconclusionsthatarisefromtheresearchare:• Theconceptofsocialenterpriseisnotwellunderstoodgenerally.Amongthe

variousstakeholders,thedefinitions,valuesandmeasuresofsuccessvary.

• Socialenterprisesprovideacombinationofsocial,economicandenvironmentalbenefitstoindividualsandregionsinneedofregeneration.

• Start-upandestablishedsocialenterpriseshavesimilarexternalchallenges,particularlyinrelationtolegalandgovernancecomplianceissues,andsourcingandaccessingfunding,whethertostartuportoscaleupthesocialenterprise.Therearecallsforthefundingframeworkstobesimplified,andfortherelatedadministrativeproceduresforapplyingforfundingtobeimproved.

• Internally,forthestart-upenterprise,issuesarisewithvalidatingthemarketopportunityandwithstaffing.Fortheestablishedsocialenterprise,thechallengesrelatemoretomanagementandgovernance,andtherecruitmentofboardmembers.

• Thecurrentlandscapeofsupportsforthesocialenterpriseislargelybasedonmainstream,micro,smallandmediumenterprisepolicy,withoutacknowledgementofthedifferentiatingcharacteristicsofthesocialenterprise,especiallyinareasoffinancing,governanceandperformancemeasurement.

• Asocialenterprisepolicyneedstobedevelopedwiththeaimofestablishingavibrantandsupportiveenvironmentforsocialenterprisestostartupandscaleup,leadingtoabalancedpipelineofsocialenterprisesinIreland.

Arisingfromtheresearchfindings,recommendationsinsixareasareproposedtoinformamorededicatedsocialenterprisepolicy,asoutlinedbelow.1.Enhanceawarenessof,educationabout,andpromotionandrecognitionofsocialenterpriseactivityItisnecessarytopromoteamorerealisticandcomprehensiveunderstandingofthemotivations,characteristicsandbenefitsofsocialenterpriseactivitythroughthefollowingactions:• Establishingandresourcingadedicatedsystemforsocialenterprises,ora

championentitythatisrecognisedasthe‘goto’entityforinformationordealingsonsocialenterpriseformationordevelopment.ItsownershipwouldbebestplacedinLocalDevelopmentCompanies,giventheirimpactonthedevelopmentofthesocialenterprisesectortoitscurrentstatedespitelimitedresources.

• ProgressingthedevelopmentofaSocialEnterpriseBrandorofabrandingofthesocialenterprisesector,andestablishingawebsitethatisthe‘shopwindow’forthesocialenterprisesectorinIreland.

• Developingcasestudiesorstoriesandtestimonialspresentingrolemodelsandadvocatesofgood-practicesocialenterprises,soastogenerateconfidenceinsocialentrepreneurshipandgiveitlegitimacyinlinewithmainstreammicro,smallandmediumenterprises.

• Deliveringtargetedsocialenterpriseinformationandknowledge-sharingeventssuchasanationalstakeholderconferenceforsocialentrepreneurship;forexample‘TheIrelandSocialEnterpriseSummit’;arrangingseminarsandworkshopsregionallyinvolvingmultiplestakeholdersengagedwiththeprogressionofsocialenterpriseactivity.Participationandcollaborationingeneralmicro,smallandmediumenterpriseeventsrunbyLocalEnterpriseOffices(LEOs)andEnterpriseIrelandwillalsoheightenawarenessanddeepentheirintegrationwiththemainstreammicro,smallandmediumenterprisesector.

Government support for the social enterprise sector must be tangible. It issuggestedthatanationwideSocialEnterpriseSupportCentrebeestablishedtostreamlinetheservicesofferedandtheactivitiesoforganisationsengagingwith

social entrepreneurs in a more formalised manner, thus leading to additionaleconomiesofscaleandsynergybetweenproviders.Morestrategically,considerationshouldbegiventodevelopingSocialEnterpriseHubsthatprovideinnovationspacestohelpbothstart-upsocialenterprisesandgrowingenterprises,offeringcommonresourcesandadministrativesupports,aswellasassistanceinareassuchasmarketing,governanceandnetworking.2.EstablishasupportivefinancialinfrastructurethatacknowledgesandrewardsthemultiplecontributionsofthesocialenterprisesectorCurrent social enterprise funding mechanisms need to be reconfigured toaddressthedifferentsocialenterprisebusinessmodelsandthevaryingstagesofsocialenterprisedevelopment.Thisrequiresthefollowing:• Changingthemindsetsoffunders(publicandprivate)andequallyofthe

socialentrepreneurastowhatrolefundingandfundersshouldplayinstartingupandscalingupthesocialenterprise.

• Enablingthesocialentrepreneurtobecomeinvestor-readyasopposedtojustgrant-ready.ThisrequiresincreasedavailabilityoftraininginFinancialPlanningandFinancialManagement,SourcingFundingandManagingCashFlow.

• Creatingalevelplayingfieldbetweensocialenterprisesandmainstreammicro,smallandmediumenterprisesforaccesstofunding,bycompensatingforormodifyingpublicfundingcriteriatoensurethatsocialenterprisescanaccessequivalentfinancialresources.

• Facilitatingamoveawayfromdependencyongrantandwagesubsidisationtoasituationwheresocialenterpriseshaveagreaterincentivetoproduce,trade,generaterevenueandreinvestsurpluses.

• Identifyingandtestinghowcontemporaryfundingorsocialfinanceintermediaries(angelinvestors,diaspora,individualinvestors,venturecapitalists,crowdfunding)arepredisposedorwillingtoprovideloans,guaranteesorquasi-equitytosocialenterprises.

• Providingmoreequitableaccesstosocialentrepreneurstosecurepublicprocurementcontractsbymodifyingthecontractualstipulationsforsocialenterprises.

Itisimportanttokeepinmindthatitisnotenoughtoincreasefundingwithoutimprovingtheallocationmechanismstoensurethatfunding isputtogooduseand tocreateabetteralignmentbetween theexpectationsof fundersand theneedsofsocialentrepreneurs.

3.ViewgovernanceandleadershipasapracticeratherthanasetofindependenttasksThe followingactionswill alleviategovernancechallenges,whichareaprimarybarrierforsocialentrepreneurs.• Clarifyingtothesocialentrepreneurwhattheconceptofgovernancemeans,

tolessenthefearsandtrepidationsassociatedwithit.Socialentrepreneursneedtounderstandthateffectivegovernanceisnotjustaboutrules,bureaucracy,andthestiflingofprogress.

• Focusingattentiononearly-stageandstart-upsocialenterprisesthatareconsumedwithestablishingapresenceinthemarketcanleadtogovernancearrangementsbeingneglected,oronlyconsideredwhenconcernsareraisedbyfundersorpublicservicecontractors.

• Devisingandimplementingbettermentoringongovernancemanagement,coveringsourcing;recruitingandassemblingaboardofdirectors;managingandleadingtheboardofdirectors;managingconflictintheboard;rules,policiesandproceduresformanagingboardoperations.

Thesocialentrepreneuralsorequiresguidelinesandinstructionsontheprocessof recruiting a board of directors, reviewing board performance, managingconflict,andmanagingtheinterdependenciesbetweenboardandmanagement.Theincreaseddemandforgovernance-relatedservicesincreasestheworkloadfor Local Development Companies; resources need to be allocated to them todelivertheseservices.Further,trainingingovernanceshouldbemadeavailableforindividualsworkinginLocalDevelopmentCompanies.

4.CreateanalignmentbetweenevaluationandmonitoringmetricsA range of suitable measurement methods, which realistically capture thecombinedenterpriseperformance(outputs)andtheprocessofachievingresults,needstobeformulated.Thefollowingshouldbeconsidered:• Differentimpactmeasurementtoolsandmetricsshouldbeappliedforearly-

stagesocialenterprisesversusmoreestablishedones.

• Monitoring,measuringandtrackingofenterpriseactivitiesmustbeintegratedintothesocialenterprisestrategydevelopmentprocessesandprocedures,andnotbeanadd-onorbeperipheraltoday-to-dayactivitiesorbecompletedonlywhenrequiredforfundingorassessmentpurposes.

• Situationsinwhichdifferentfundersandagenciesimposesignificantlydifferentanddemandingmeasurementmethodsonindividualsocialenterprisesmustbemanagedandreduced.

• Currentrequirementsandstipulationsformeasuringsocialenterpriseperformancethatareoverlyprescriptiveandoutput-focusedmustberedesigned,sothatthemethodsfocusontheprocessofsettingtargetsandachievingoutputs,andrelatetotherealitiesoftheoperationsandmilestonesofthesocialenterprise.

• TrainingandcompetencydevelopmentneedstobeprovidedforsocialentrepreneursandpersonnelinLocalDevelopmentCompaniesandfundinginstitutions,intheareaofmeasuringperformanceandimpactinthesocialenterprise.

5.Providecompetencyandcapabilitytrainingforstart-upandscaling-upsocialenterprisesTheavailabilityofresourcesontheirownwillnotguaranteeasustainedpipelineofsocialenterprises if thesocialentrepreneur isnotcapableandcompetent inaddressingthechallenges,barriersandopportunitiesaffectingtheiroperationaland strategic decisions. Therefore the provision of cross-functional trainingaddressingthesocialandcommercialrequirementsoftheenterpriseshouldbesupportedinthefollowingareas:• Managementandleadership–bridgingthebusinessfunctionstoachieve

socialandcommercialimpact

• Validatingthesocialconcept–thequestionstoaddress

• Applyingforfundingandmanagingfinance,funding,pricingstrategies

• Strategydevelopment–developingstrategicthinkinginthesocialenterprise

• Integratingsocialandcommercialbusinessmodelstoachievescale

• Monitoringandmeasuringperformance–beyondasetofmetrics

• Workingthroughandwithchange

• Personaldevelopment–bridgingthesocialandbusinessmindsettoachievescaling

• GovernanceandboardofmanagementcompetencydevelopmentMentoringisanimportantpartofthedeliveryprocess.Greaterengagementwithmentors from financing institutions and experienced social entrepreneurs willprovide complementary learning opportunities for social entrepreneurs. To

provide training personnel in the Local Development Companies and othergovernmentagenciesdeliveringservicestothesocialenterprisesector,upskillingandtrainingintheseareaswillberequiredtoensurethatcontentanddeliveryaddresstheever-changingtrendsintheseareas.6.Enhancenetworking,partnershipandcollaborations,toachievegreatersocialimpactNetworkingacrossorganisationalboundariestocreatesocialvalueisapowerfulscalingstrategyforsocialentrepreneurs,ascreatingsocialvaluedoesnotrequirethat value be capturedwithin a single enterprise boundary. It’s not just aboutundertakingmorenetworkingeventsbutrather theobjective is todeepenandcapitaliseoncurrentnetworkswithaviewtodeterminingwhichonesworkbest,and why and how to expand on them. The following actions will assist inattainingthisobjective:• Bemoredeliberateinusingexistingnetworksasplatformsforknowledge-

creation,learningandshapingtheexternalenvironmentinfavourableways,andcollaboratewithothersocialentrepreneurs,funders,educators.

• Improvethecommunicationsmechanismsandlearningopportunitiesacrossrelevantnetworks,perhapsorganisingsub-groupsaroundspecifictopicsofinterest.

• Considerdevelopingcommonlearningprogrammesandcurriculaacrossdifferentformalnetworksinwhichthemembershavesimilarneeds.

• Developnetworkingskillsinthesocialentrepreneurfortherolesof‘networker’and‘collaborator’.

• Evaluateandtestbusinessdevelopmentpartnershipoptionssuchasskillspartnerships,channelpartnerships,andventurepartnerships.

Theserecommendations,drivenbyacommonconsensualgoalofcreatinganenablingandsupportiveenvironmentforthesocialenterprisesectorinIreland,mustbefrontedandsupportedbygovernment.Theirimplementationmustbesharedbythekeystakeholdersinteractingwithsocialentrepreneurs.

TableofContents

1.0Introduction 1

2.0WhatisaSocialEnterprise? 3

3.0TheSocialEntrepreneurshipMilieu–SocialEntrepreneur,SocialEnterpriseandEnvironmentalConditions 6

4.0ResearchApproach–DataCollection 9

5.0ResearchInsights 105.1Supportsprovidedtosocialenterprises–directandindirectserviceprovision 12

5.1.1Directsupportsofferedtosocialenterprises 135.1.2Indirectsupportsofferedtosocialenterprises 17

5.2Thecontributionsthatsocialenterprisesprovide 245.2.1Employmentcontribution 255.2.2Trainingandupskillingcontribution 285.2.3Socialcontributions 28

5.3Opportunitiesandchallengesfacingsocialenterprises 35

6.0CreatinganEnablingandSupportiveEnvironmentforSocialEnterpriseActivity 446.1.Enhanceawarenessof,educationabout,andpromotionandrecognitionofsocialenterpriseactivity 476.2Establishasupportivefinancialinfrastructurethatrewardsthemultiplecontributionsofthesocialenterprisesector 526.3Viewgovernanceandleadershipasapracticeratherthanasetofindependenttasks 576.4Createanalignmentbetweenevaluationandmonitoringmetrics 606.5Providecompetencyandcapabilitytrainingforstart-upandscaling-upsocialenterprises 636.6Enhancenetworking,partnershipandcollaborations,toachievegreatersocialimpact 65

7.0ConcludingComments 697.1Keepingtheconversationgoing–areasforcontinuedresearch 70

References 71

Appendix1:Copyofquestionnaire 72

Appendix2:Examplesofgood-practicesocialenterpriseactivity 87

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1.0 Introduction Socialentrepreneurscontributesubstantially to the Irisheconomy(ILDN,2014;Forfás2013; IrishSocialEnterpriseNetwork,2012;DoyleandLalor,2012).Thesectorisdiverseintermsoftheprofileofthesocialentrepreneurandthenatureandstructureofthesocialenterprise,rankingacrossaspectrumofcommunitygroupstocommercialandprofit-makingentities.As social enterprise activity has intensified, government policy focus on thissectorhasstrengthened,withtheestablishmentofaSocialEnterpriseTaskforce,publication of the Forfás report Social Enterprise in Ireland: SectoralOpportunities and Policy Issues (2012), and the development of anInterdepartmental Working Group focusing on incorporating the socialenterpriseagendainthekeyEUIrelandPartnershipAgreementandOperationalProgrammesfor2014-2020.Theimportanceofdevelopingthissectorishighlightedinthecomment:

It is important that we build a framework through which socialenterprises across the spectrum can obtain supports fromGovernment Departments and agencies which are appropriate totheir levelofdevelopment, thenatureof their activities and theircommercialambition’(Forfás,2012).

Thedevelopmentofsuchaframeworkisanongoingtask.Thissocialenterprisesupport framework should combine a strategic perspective and an alignedoperationalfocustoaddressthemanyneedsoftheheterogeneouspopulationofsocialentrepreneursinIreland.Itsformulationnecessitatesanunderstandingofthe interconnectedandoftencomplexrelationshipbetweenthe internal forces(social entrepreneur) and external environmental conditions (funding, marketdemand,publicacceptance,economicandsocietal)affectingdecisionstostartorscaleupasocialenterprise.The findings from this research study, commissioned by the Irish LocalDevelopmentNetwork(ILDN),willfeedintothedevelopmentoftheframework.Theyprovideacontemporaryperspectiveof theoperational,managementandgovernancechallengesencounteredbysocialentrepreneursastheystartuporscaleuptheirenterprises.

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The scope of the study is to profile social enterprise activities and theircontributions,andtoidentifythechallengesthatsocialentrepreneursencounterindevelopingandscalingtheirenterprise.• Thereportbeginswithabriefdiscussionoftheclassificationsanddefinitional

issuesassociatedwithsocialenterprises,followedbyananalysisoftheinterdependencybetweenthesocialentrepreneurandthesocialenterprise.Inthisway,thecontextframingsocialentrepreneurialbehaviourisestablished.

• Next,theresultsoftheempiricalsurvey,involvingrepresentativesof20twentyLocalDevelopmentCompanies,arepresentedinordertoprofile:

o theactivitiesofsocialenterprisesandtheirmanycontributions

o therangeofdirectandindirectsupportsrequestedbysocialenterprises

o thechallengesandissuesaffectingthescalingofsocialenterprises

o theopportunitiesthatlieaheadforsocialenterprises

• Recommendationsarethenofferedconcerningthedevelopmentofsupportinterventionstostimulate,nurtureandenableamorevibrantsocialenterprisesectorinIreland.

• Finally,someavenuesforfurtherinquiryemergingfromtheanalysisofthefindingsarepresented.

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2.0 What is a Social Enterprise? The social enterprise sector is a relatively emerging construct in the overallpopulationof enterprises. In some instances, it is viewedas a ‘niche sector’, a‘fad’ or a ‘grey area’ nestled somewhere between the for-profit and not-for-profitsectorsorcommunityprojects.Socialenterprisesbridgeproductandservicegaps ingeographicalandsectoralareasneglectedbygovernmentinterventionsordeemedfinanciallynotviablebytraditional enterprises. They benefit society by smoothing out economicshortcomings through raising social awarenessandproviding solutions (Santos,2012).Social enterprise activity covers a broad spectrum, from community-basedprojects funded by the State, to a smaller number of businesses trading on acommercial basis and owned solely or by a team of entrepreneurs and co-operatives.Theymergeatoneendwiththevoluntaryandcommunitysectorandattheotherwithcommerciallyoperatedbusinesses.Theseenterprisesoperateacross a varietyof sectors, provide a rangeof services, operate in allmarkets,and tackle complex social and environmental challenges in innovative andsustainableways.Thevariationinthestructuresofsocialenterprisescompoundsthechallengeofarriving at a common definition for the social enterprise. In the Irish context,socialenterprisesaredefinedbyForfásas:

…anenterprisethattradesforasocial/societalpurpose,whereatleast part of its income is earned from its trading activity, isseparate from government and where the surplus is primarilyreinvestedinthesocialobjective’(Forfás,2013).

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SocialenterpriseversuscommunityenterpriseThis definition masks the range of social enterprise activity in Ireland, wherecommunityenterprisesformanimportantcomponent.Forinstance,communityenterprises are assumed into the same definition as social enterprises, butcommunity enterprises are typically owned andmanaged by individuals in thecommunity, who were in some cases managers or employees in communityinitiativesandevolved into the social entrepreneur role. Theseenterprises candevelop sub-enterprises, products, services and projects to meet a range ofspecificsocial,economicandenvironmentalproblemsintheircommunity.Theyprovideajoined-upapproachtotacklingoftendeep-rootedandcomplexissues.Asocialenterprise,ontheotherhand,isoftenseenasmorerootedintheworldofbusinessanddevelopsproductsand services thathavegreaterpotential forgeographicexpansion.Shoulda communityenterprise, then,be viewedas a social enterprise, or is itnecessarytodevelopanalternativedefinitiontoaccommodatethevariationsinactivityandmodesofoperation,andindeed,insomecases,theethosdrivingtheentity.?The difficulty in arriving at a single unifying definition is not unique to Ireland(BornsteinandDavis,2010;Vasi,2009). It ispartlyduetotheheterogeneityofthesocialenterprise,variationsinitsstageofevolutionandgrowth,thenatureof the product or service offered, and the governance and business modelconfigurations.Risksofapplyinga‘onefitsall’ definitionGiventheheterogeneityofthesector,isitappropriatetostrivefora‘onefitsall’definition, rather than devising a set of guidelines or characteristics that takesaccountofthenationalcultural,economic,regulatoryandsocialmilieushapingsocial enterprise activity? Such a descriptor could provide the parameters toguidemoreinclusivesocialenterprisepolicy.WhiletheevolutionofanIrishgovernmentdefinitioncapturingsocialenterpriseactivity is a step in the right direction, caution should be exercised aboutapplying it inastrictwaywhenitcomestoallocatingsupports;thismight limitsocial enterprise access to government supports, in particular fundingopportunities.Further,itmightbedifficultforsomesocialentrepreneurstopositionorfittheirenterprise into the parameters of the definition, which wouldmean a lack of

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recognition for theoutputsand important socialbenefits they spinoff to localeconomies.Moreover,theapplicationoftoonarrowadefinitioncouldmasktheactualleveland intensity of social enterprise activity in the country, as thosewho do notalignwiththedefinitionwouldnotberecordedinfundingapplicationsorinthegeneralmicro,smallandmediumenterprisedatabases.Central to thedevelopmentof anappropriatedescriptorofwhat constitutesasocial enterprise is an understanding of the interconnected behaviour of thesocialentrepreneurandthesocialenterprise,asameansofidentifyingtheroleof internal drivers (motivation of the social entrepreneur, the operational andbusinessmodeladopted)andtheexternalenvironmentalconditionsshapingthebehaviourofthesocialentrepreneur.

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3.0 The Social Entrepreneurship Milieu – Social Entrepreneur, Social Enterprise and Environmental Conditions To examine the performance of the social enterprise, we need to take a dualperspective:understanding(a)thesocialentrepreneurandtheircharacteristics,and the social enterprise they develop, and (b) the external conditions theyoperate in.Theexternalenvironment,describedas factorsaffectingthenatureandoutcomeofthesocialenterpriseopportunity,includesthemacroeconomy,funding,andthesocietal,financialregulatoryandsociopoliticalenvironment.This composite insight into the rationale for the decisions of the socialentrepreneur–onscaling,onthebusinessmodeltoadopt,onsourcesoffundingand performance outputs – will identify capability and competency gaps thatrequireattention inpolicy supports. Itwill also show if currentpolicy supportsareappropriateorsufficientlytargetedtotheneedsofthesocialenterprise.Social enterprises mainly focus on value creation or value capture, which isembedded in the architecture of the organisation design, decision-makingprocesses,networksand relationships that socialentrepreneurshaveaccess toanduse(Santos2012;Zeyenetal.,2012).Socialentrepreneursmeasuretheirsuccessnotprimarilybytheamountofprofittheymake,butmorebythedegreeofsocialvaluetheycreate(Hartigan,2006;Zeyenetal.,2012).Theseprofitsmaybepartiallydistributedtothestakeholdersor typically reinvested in the enterprise to fulfil itsmission. The impact of theenvironmental context on a social entrepreneur differs from that on a

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commercialentrepreneurduetotheinfluenceofthesocialentrepreneuronthesocialmissionasadriverforthedevelopmentoftheenterprise.Themarket-selectionmechanismsinthesocialsectorlackintensitybecausetheyhavelesspowerovermarketconditionsandactover longerperiodsoftime. Inothercases,asocialissuemaybecompellingonlytoarelativelysmallnumberofconstituenciesandmayhavevery lowvisibility, anda socialentrepreneurmayseektomakeanimpactbyraisingawarenessabouttheissue.Indeed,anadversecontextmay often lead the social entrepreneur to seek to change the contextitself,asoftenthesocialproblemisdeeplyembeddedincontextualfactors.Essentially, social entrepreneurs are viewed as initiators of a socialentrepreneurial endeavour driven by a social agenda to push through socialinnovationsandprocessesofsocialchange(Ziegler,2010),eitherindividuallyorcollectively(BacqandJanssen,2011).Santos(2012)triedtobringmoreclaritybydistinguishing between social and commercial entrepreneurs. He claimed thatsocialentrepreneursaredistinctfromtheircounterpartinthreemaindomains:1) thegoalstheytrytoachieve

2) thedifferentbusinessmodelsandmethodstheyuse

3) theirmanagementstyles,andoperationalandgovernancepoliciesandprocedures

Socialentrepreneursinwhatevercontext(communitygroups,co-operativesandindependentsocialenterprises)aredrivenbyastrongsocialethos;theyneedtoapply a range of enterprising skills and behaviours that are associated withventurecreationandgrowthtosustaintheirenterprisesandachievetheirsocialmission.Socialentrepreneursprovideavehicle forestablishinganddevelopingpersonalautonomyandempoweringindividualsinsociallyexcludedgroupswithindependence, enhanced personal development, self-actualisation and self-definition, thus enabling them to act as credible contributors to the economyratherthanasrecipientsofstateaid.ThechallengeforthesocialentrepreneurThe social enterprise is a collective construct; it contains elements fromcommercial and non-commercial organisations, extended with entrepreneurialattributes, behaviours and competencies, and is motivated by many sociallyrelated and impactful goals. The attainment of these goals requiresentrepreneurial knowhow on how best to combine business efficiencies whileachievingsocialimpactandthusachieveadoublebottom-lineresult.

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Therein lies a challenge for the social entrepreneur: how to align their socialenterpriseformattoaddressandsatisfythechangingneedsoftheirstakeholderswhilstmaintainingarevenuestreamtosustaintheenterprise.Moreover, social enterprises compete with each other for scarce funding,governmentgrantsandcontracts,forvolunteers,forcommunitymindshare,andfor employeeswithin their ‘industry’ contexts. This is an issue often forgottenaboutinpolicydevelopment.Understandingwhatconstitutesasocialenterpriserequiresclearunderstandingof the social entrepreneur capability and competencies and their interactionswith external environmental forces shaping their decisions. This understandingmust extend to the characteristics of the enterprise, to where they fit in thespectrum of business entities, and their real contribution beyond their socialagenda.The evolving perceptions of social enterprise are mediated by externalenvironmental(economic,political,marketopportunitiesanddemand,fiscalanddemographic) forces.Thus the focusondefinitionbecomes lesscritical; rather,theemphasis shouldbeon identifyingareasofopportunities, anddeterminingthecompetenciesandcapabilitiesofthesocialentrepreneurandthecapacityofthesocialenterprisetodeliverontheseopportunities.Whileorganisationalsurvivalinthesocialsectormaynotalwaysseemtodependon responsiveness to the external context, a social enterprise that continuallymonitors the context closely can develop strategies to reduce the effects ofadverseenvironmentalchanges,andexploitopportunitiesthatmightarisefromfavourabletrends.Theexternalcontextshapestheopportunitiesavailabletothesocialentrepreneur,andaproactivemanagementapproachwillbestenabletheentrepreneur to target opportunities and mobilise resources to achieve thegreatestsocialimpact.TheenterprisejigsawInsummary,socialenterprisescanbeviewedasanimportantpieceofthejigsawpuzzleofthetraditionalworldsofgovernment,non-profitandprofitbusinesses;itisimportantthat,whileitsdistinctcontributionisacknowledged,thispiecefitsinaseamlessandlinkedmannerintotheoveralljigsaw.Thisstudywilldemonstratewhythesocialenterpriseshouldbeacknowledgedasa keypieceof theoverall jigsawof thebroaderpopulationofenterprises, andwill show that,while it fits in cohesively, it yet hasdistinct characteristics thatrequirededicatedpolicyinterventions.

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4.0 Research Approach – Data Collection The aim of this research was to elicit information on the operational,managementandscalingissuesandchallengesencounteredbysocialenterprisesinstartingupandscalingup.Representatives of Local Development Companies (LDCs) have performed acentral role in developing and providing advice and supports to advance thesocial enterprise sector in Ireland. They are frequently the first touchpoint forindividualswishingtostartasocialenterprise.LDCshavebeenidentifiedbygovernmentasthekeyimplementingpartnersforthe Social InclusionProgramme fundedby the European Social Fund (ESF) andthe European Agricultural Fund for Rural Development (EAFRD) LEADER, andhavebegundeliveringthetwokeyprogrammes.A targeted sample of 20 representatives of LDCs was surveyed. The surveyquestionselicitedinformationon:• theprofileandcontributionofthesocialenterprisesthatLDCsworkwith

• thevarietyofservicesofferedbyLDCstosocialenterprises

• thesectoralareasseenasprovidingopportunitiesforsocialenterpriseactivity

• thechallengesencounteredinstartingupandscalingupsocialenterprises

TherepresentativeswerealsoaskedforsuggestionsonthesupportsrequiredtodevelopamoresustainablesocialenterprisesectorinIreland.

AppendixIcontainsacopyofthesurveyinstrument.

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5.0 Research Insights The research findings are presented according to the primary themesinvestigatedinthesurvey.• Thefirsttopicdescribestherangeofdirectandindirectsupportsofferedby

LocalDevelopmentCompanies(LDCs)tosocialenterprisesandthesupportsmostsoughtbysocialentrepreneurs.

• ThesecondsectionprofilesthesocialenterprisesusingLDCservicesandprovidesanoverviewoftheirmanycontributions.ThemethodsofperformanceevaluationthatLDCsapplytosocialenterprisesarealsodiscussed.

• Withaneyetothefuture,suggestionsarepresentedonthesectoralareasthatofferopportunitiesforsocialentrepreneurs,andthechallengesencounteredbysocialentrepreneursinstartingupandscalingupsocialenterprisesaredescribed,withoutlinesuggestionsonhowthesechallengescanbeovercome.

• Theresultsfromthevarioussectionsareintegratedtopresentapractical,holisticandup-to-dateinsightintotheopportunities,challengesandbarriersfacingsocialentrepreneursatthestart-upandscalingstagesofthesocialenterprise.

Theresultsofthisstudywillguidepolicydevelopmentonthetypeofdirectandindirect supports needed to establish a more successful and vibrant socialenterprisesector.Table1.0showstherespondentprofile.

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Table1.0:RespondentprofileRespondentName LocalDevelopmentCompany

AnnFlynn North-EastMayoTomBermingham WexfordLocalDevelopmentElaineMcGrath PaulPartnershipFrancisMcCarron MonaghanIntegratedDevelopmentTrionaMurphy IRDDuhallowMichaelBowe TolkaAreaPartnership

BrendanO’Loughlin OffalyIntegratedLocalDevelopmentCompanyConorRyan BlanchardstownAreaPartnershipTaraSmith CanalCommunitiesPartnershipLarryO’Neill SDCPPádraigCasey BallyhouraDevelopmentLtd

EleanorMcLoughlin WestLimerickResourcesNoritaClesham South-WestMayoDevelopmentCompanyPatriciaKelly GalwayRuralDevelopmentCompanyLtd.LizRiches WaterfordAreaPartnership

RalphJames Ballyfermot/ChapelizodPartnershipElizabethDunne Co.WicklowPartnership

MichaelBegleyandMaryBarry-Guerin

SouthTipperaryDevelopmentUnit

RobertCarey North-EastandWestKerryDevelopmentRyanHoward South&EastCorkAreaDevelopmentLtd

The respondent LDCs represent a number of regions and a variety of socialenterprises, providing a good representation of the varied mix of socialenterprisesinoperationacrossIreland.

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5.1Supportsprovidedtosocialenterprises–directandindirectserviceprovisionLDCs support the community and voluntary sectorbyprovidingenterprise andemployment-related supports for start-up and established enterprises. Thefindings of this research demonstrate the comprehensive range of supports(direct and indirect) made available to meet the needs of a diverse socialenterprisesector,atdifferentstagesofdevelopment.Thedirectsupportsprovidedinclude:• Pre-enterprisetrainingprogrammes

• Adviceforbusinessideadevelopment

• Devisingandpresentingabusinessplan

• Assistancewithmarketingandstrategydevelopment

• Guidanceonprocurement,andadviceandassistanceonsourcingandapplyingforfunding

Additionally, theLDCsadministerandcoordinateworkplacementschemesandnetworking events, and deliver bespoke services as required by socialentrepreneurs.Across the total sampleof respondentLDCs, itwas found that certain typesofsupportswereparticularlypopular,asdiscussedbelow.

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5.1.1DirectsupportsofferedtosocialenterprisesThe range of enterprise and employment supports cover the spectrumof pre-start-up to established social enterprise requirements. In the main they aredelivered separately to the more general enterprise supports offered by theLDCs.Pre-enterprisetrainingsupportsOver 50% of respondents provided the tailored ‘Start your Social Enterprise’programme,complementedbymentoringandadvice.Thementoringandadvicecovers a range of topics such as developing a business plan; how to sourcefunding; financial planning; human resource management, and assembling aboardofdirectors.Inadditiontomentoring,thereisastrongfocusonprovidingnetworkingexpertiseandidentifyingrelevantnetworkingopportunitiesforsocialentrepreneurs.Theseservicesaredelivereddirectly,usingthein-houseskillsoftheexperiencedstaffanddirectorsoftheLDCs.Comments from respondents indicated that primary areas of learningopportunitiesforsocialentrepreneursincludeskillsinnetworking,knowingwhotonetworkwith,andhowtoidentifyrelevantnetworks.Grantassistanceforsocialenterprisestart-upandexpansionGrant assistance to social enterprises is allocated through a variety ofprogrammes such as LEADER, the Local Development Social InclusionProgramme, the Rural Development Programme, and the Social Inclusion andCommunityActivationProgramme(SICAP).SICAPisthemostpopularscheme.Fundingisallocatedforavarietyofoperational-levelenterpriseactivitiesinareassuchasassistingsocialentrepreneurstoapplyforfunding,marketingactivities,business-plan development, market research, sourcing reports, applying forgrantaid,legalcosts,andtheimplementationofstrategy.Support and advice on how best to address the business-plan criteria andcompleting the funding application form is a support frequently requested byaspiringandstart-upsocialenterprisesduetodifficulties in tryingtodevelopacompelling business argument for an enterprise with a predominantly socialmission.Linked to the above is the requirement for assistance and guidance onidentifyingsourcesoffundinganddeterminingwhatsourcesarerelevanttothevarioussocialenterprisepropositions.

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Additionally,fundingisallocatedforthedevelopmentoflarger-scalecommunity-basedinitiatives.CommunityandvoluntaryplacementsThe opportunity to employ individuals in the social enterprise through thevarious community and voluntary schemes bridges an important resource gapfor the social enterprises at the start-up and scaling stages. This employmentavenueenablessocialenterprisestosecurestaffforbusyperiods,andprovidesflexibility in managing staff numbers to accommodate the demands of theenterpriseinacost-effectiveandspeedymanner.Schemes such as the Community Employment Schemes, Tús, the Rural SocialScheme (RSS) and Job Initiative were themost frequently used. The LDCs areresponsibleforcoordinatingandadministeringtheseschemes,andarepivotalincollaboratingwithsocialentrepreneursonselectingthemostsuitableschemes,andassistingintheapplicationprocess.Tús was used in 14 cases and was viewed as important in providing staff forshort-term and temporary roles in projects that deliver home repairs andimprovements,communitycentres,communityshops,craftcentres,etc.Furtherexamples cited Tús as providing important staffing requirements for coreservices to the community such as communitymeals, and in the operation oflocaldaycarecentres,whichmightnotbefeasibleifthissourceofemploymentwasnotavailable.TheCommunityEmploymentSchemewasalsocommonlycitedbyrespondentsfor projects such as providing services for older people and primary schoolchildren(suchasafter-schoolclubs),farmprojects,etc.TheRSSprovideswork-experienceopportunitieswithsocialenterprisesacrossabroad range of sectors such as environment, heritage, arts, tourism, childcareand social serviceprojects.Comments indicated thatapositiveelementof theRSS is that participants can work up until retirement, and that this longevityprovesvital in thecontributionof services,andadditionallyprovides inclusivitytoabroaderrangeofindividualswhoareseekingworkopportunitiesandasenseofbelongingandvalue.TheuseofJobInitiativewaslessevidentintheresponses;whereonoffer,itwasusedtoengageindividualsassupportstaffforsocialenterprises.Likewise,therewas a relatively low uptake on the JobBridge scheme, involving just fourrespondents.

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ValueofworkschemesThere was a consensus amongst respondents that the various programmespresentanimportantmechanismtobridgeskillsdeficienciesinsocialenterprisesandanswertheneedformeaningfultrainingandemploymentopportunitiesformarginalised groups of individuals who are in many instances excluded frommainstream employment opportunities (individuals with disabilities, ex-prisoners,ex-offenders,earlyschool-leavers,etc).Thatsaid,thetemporarynatureoftheworkplacementcontractcanbelimitingfor the participants in terms of skills enhancement and learning; in manyinstances, once the period ofwork is over theremay not be any follow-up orsimilarworkopportunitiesavailabletothem.Thebenefitsaccruingfromtheschemesareinstrumentalinthecontinuityofthesocialenterprise.However, cognisancemustbe takenoff the issuesassociatedwith the lack of staff continuity, high staff turnover, loss of skills, and the lowreturnonthetimeandeffortspentbythesocialentrepreneuroninductionandrole-training.Essentially, the use of these schemes is a short-term strategy tomeet staffingrequirements.Itwouldbeinterestingtodetermineiftheiruseshapesthenatureandexperienceofthepersonemployedinthesocialenterprise,ordoesthejobspecification drive which scheme is used to source staff? Further, how hasparticipationinaschemebenefitedtheclientintheircareerpath,andhowcansuchschemesbeadoptedtoprovidelonger-termmutuallybeneficialreturnsforboth the social entrepreneur and the schemeparticipant. These are importantquestions to address to help ensure effective and sustainable human resourceplanningandcapability-buildinginthesocialenterprise.LDCs provide direct supports for competency development in changemanagement, staff management, setting targets, monitoring progress, andgettingthemostfromstaffingresources.Wheredeemedrelevantandrequestedby social entrepreneurs, bespoke workshops were designed and delivered toaccommodate specific enterprise needs. In some instances these workshopsweredeliveredacrossthelevelsinthesocialenterpriseinvolvingmembersoftheboard,management,staffandvolunteers.While consistent trendsemerged in the survey responseson themostpopulardirectand indirect supportsoffered, responses indicated that it isnecessary tomodify programmes aswell as design tailored programmes to fit the stage ofprogressionofthesocialenterpriseanditsspecificneeds(includinganylocalorregionalvariations).

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Theavailabilityoftheseprogrammeswasdeterminedbytheresources(peopleandfinance)availabletotherelevantLDC.Somepositivecommentsmentionedthe possibility of receiving increased resources under the next LEADERprogramme,whichwillhaveamorededicatedfocusonsocialenterprisestart-upbusinessprogrammes,thusinsomewayaddressingtheresourcechallengethatLDCsarecurrentlyfacing.Thepivotal roleof theLDCwas further identified in thedesignanddeliveryofindirectsupportstothesocialentrepreneur.

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5.1.2IndirectsupportsofferedtosocialenterprisesA common rangeof indirect supports (standardisedand tailored)wereofferedacross the cohort of respondents. These emphasised training and advice foroperational management, general management and governance issues.Complementing the workshops, particularly in the area of governance, thefacilitationofpeerlearningwasviewedasbeneficial,wherelearningfromboardmembers or social entrepreneurs who have experience in this area proved apositivelearningandnetworkingencounter.AnumberofLDCshavedevelopedtrainingmaterials, templatedocumentsandinformationguideswhicharebeingusedonmanyoccasionsandhavepotentialfor transferability and use by other LDCs. For example, templates weredevelopedforadministrativeormanagerialstaffformonitoringongoingprogressagainst income targets through theuse of Excel (charts). Theheterogeneity ofsocial entrepreneur needs is evident in the analysis of the responses to theirvariedrequirementsforindirectsupportsandcompetencydevelopment.Aswith the provision of direct supports, the pre-emptive approach of staff inLDCs is paramount in thedesign and customisationof serviceswhen required,and in the ability to respond to bespoke requests, in addition to the morestandardrequestsfromsocialentrepreneurs.This addedworkload is not typically accounted for as the indirect supports onoffer are developed largely for mainstream micro, small and mediumenterprises. Many of these more bespoke services relate to sourcing andsecuringsocialenterprisefunding,suchasthepreparationofgrantandfundingapplications; identification of sources of funding; how to address eligibilitycriteriaforfunding,andassistancewithgeneraladministrativeduties,especiallyinvolvinggovernanceandcomplianceissues.There is increasing demand for support and assistance with governance andcompliance requirements for the sourcing and recruiting of board members;writing terms of reference for the board; defining the roles, duties andobligations of the board, and identifying best-practice cases of how boardsshouldoperate. This increaseddemandhas timeand resource implications forstaff in the LDCs, generating challenges as to how finite resources can bestretchedacrossabroadersetofcommitmentsfromthesocialenterprisesector,whilstsimultaneouslyprovidingservicestotheirotherenterpriseclients.Insomecases,externalexpertsarecontracted intodelivergovernance-relatedadviceandmentoring.Thisusesupscarce fundingand in the longer termmaynotbe thebestoption. LDCstaff shouldbesupported toundertake training in

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therelevantareassothattheycandelivertrainingandmentoringtothesocialenterprisestheydealwith.Giventhechangingregulatorygovernancecompliancerequirements,additionalresourceswillberequiredtodeliverinformationworkshopsontheGovernanceCodeforcommunity,voluntaryandcharityorganisationsinIreland;manysocialentrepreneursarenotdeeplyknowledgeableaboutthecodeor its implicationsfortheoperationsofthesocialenterprise.ThereareopportunitiesforLDCstaffto participate in refresher training to ensure they are updated on the mostrecentgovernancecomplianceissues.The governance-related supports on offer include workshops to provideinformation on the code and its requirements, and structured trainingprogrammes to facilitate social entrepreneurs in becoming code-compliant. IfLDC training is lacking, the social entrepreneurs are referred to relevantsuppliers.Toalesserdegree,andmainlyonademandbasis,trainingisprovidedon the legal issues involved in runningandmanaginga socialenterprise,alongwith information on self-governance and ethical issues, and advice on riskmanagement.Governance-relatedburdenThenumberofgovernance-relatedtasksthatneedtobecompletedbythesocialentrepreneurhas increased; thisaffects theoperationsof the socialenterpriseandconsumesbothtimeandresources.Ingeneral,thesocialentrepreneurisnotfamiliarwith the specifics of the compliance requirements and thus resorts totheirLDCcontacttoassistthemincompletingthevarioustasksandinensuringthattheirenterpriseiscompliant.Therequestsforassistance,asfoundinthisstudy,highlightthreecoreareasthatareincreasinglyviewedasachallengeandbarrierforthesocialentrepreneurinprogressingtheirenterprise;choosingboardmembersforthesocialenterprise;engaging with the chair of the board of directors, and participation in ormembershipofthesocialenterprisemanagementcommittee.The nature and depth of governance-related compliance requirements haveresulted in social entrepreneurs expecting more assistance from their LDCcontact.LDCemployeesareexpectedtoextendtheirrolebeyondadvisorto, insome instances, undertaking certain governance-related tasks on behalf of thesocialentrepreneur.

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ChoosingboardmembersRespondents were unanimous that social entrepreneurs find it increasinglyproblematic to source, profile, screen and recruit new board members. As aresult, social entrepreneurs are resorting to LDCs to assist them or, in someinstances, undertake this duty on their behalf, as described in the followingcomments:

‘Allofthecompanies(withnoexception)havestatedthatitisdifficulttofindnewboardmembers.DuringworkshopssuchastheGovernancetraining,discussionsaroundthischallengealwaysemerge.Companiesareencouragedtoco-optmissingexpertiseontoasub-committee(e.g.FinanceorHR)asafirststeptoencouragingnewpeopletogetinvolved.SomeofthecompanieshavepublicisedtheirAGMs,invitingpeoplefromthelocalcommunitytoattend.Thishasresultedinsomenewmembersbeingrecruited.Thisisaworkinprogressandoneoftheplansduring

theperiodoftheSocialInclusionandCommunityActivationProgrammeistodevelopapilotinitiativewithMayoVolunteerCentretoencouragenewmembers.Atthisstage,justpreliminaryconversationshavetakenplacewiththeCo-ordinatoroftheVolunteerCentreanditwillbe2016

beforeweareinapositiontodevelopthisfurther.’

‘[Wea]ssistgroupsifrequestedtoidentifytheskillmixrequiredforparticular-typesocialenterprises.’

‘WesitonBoardofdirectors,supportBoardinselectionofpotential

Boardmembersvis-a-viscontributiontosustainabilityoftheenterprise.’

‘[Wea]ctinanadvisorycapacityonbestpracticeinareasofgovernancearoundestablishingBoardofDirectors,throughliaisingwithBoardsof

DirectorsofotherSocialEnterprisesinthearea.’

‘[Wea]ssistintheestablishmentoffirstboard,encourageresidentstobecomeinvolvedandencourageboardstousevolunteercentresand

boardmatchforrecruitingnewdirectors.’

‘[Wed]onotgetinvolvedinchoosingbutsupportings/e[socialenterprise]toengagedirectorswithspecificexpertise.’

‘ItishopedthattheSteeringGroupwillformthebasisforastand-alone

entityandBCPwillparticipateinthisprocess.’

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The comments reflect the increasing hands-on assistance required by socialentrepreneurs to secure and assemble a board of directors. The socialentrepreneurhasalimitednetworkofrelevantpeopletocallontoparticipateintheboardandalsohaslimitedtimeforsuchatask,giventhattheyarecentraltotheoperationsoftheenterprise.EngagementwiththechairoftheboardofdirectorsRespondentsalsoindicatedthattheirdutiesextendtoengagingwiththechairofthe board of directors on regulatory and compliance issues, and on reportingprocedures.Aswith theselectionofboardmembers, there isan increasing relianceon theLDCtoassisttheboardchairwithdetailsonwhatisrequiredoftheenterprise,accountingandreportingmilestones,fundingproposals,andplansforexpandingthe enterprise. This is particularly the case where the chair may not haveexperience in the operations of a social enterprise or be familiar with therelatively new compliance requirements and the consequences of non-compliance.The following comments highlight the increasingly embedded role of the LDCwhenitcomestogovernance-relatedissues:

‘TherehasbeeninformalengagementwiththeChairsoftheBoardofDirectorsthroughHR/GovernanceandFinancialtraining.ThishasledtocontactbeingmadeandinaminorityofcaseshasledtofurthercloserworkwiththeChair.Inprovidingsupporttothebusinessesittakestime

tobuilduparelationshipoftrustwiththeManagerandtheChairperson.Thetypeandlevelofengagementisonethatmustbeapproached/coordinatedcarefullysothateitherpersondoesnotfeelunderminedbythesupportsbeingputinplace.Theexperienceof

workingwithcompaniesinrelationtoadoptingtheGovernanceCodeallowsthisengagementtoprogressinapositiveway.’

‘Advise/guidancetoBoardofDirectorsreprotocol/formatandelectionprocess,sitonBoardofdirectors,supportBoardinselectionofpotentialBoardmembersvis-a-viscontributiontosustainabilityoftheenterprise.’

‘Actinanadvisorycapacityonbestpracticeinareasofgovernance

aroundestablishingBoardofDirectors,throughliaisingwithBoardsofDirectorsofotherSocialEnterprisesintheareawhichBallyhoura

Developmenthassupported.’

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‘FullysupportchairsandinmanycasesSDCPstaffserveaschairofBOD.’

‘Provisionofongoingsupportregardingroles,trainingneeds,etc.’

‘Yeswesupportthechairwithadviceandmentoring.’

‘Operatesasocialeconomyworkinggroupintheregionandthisactsasadrivingforceforallthirdsectoractivityintheregionwhereguidanceisreceivedonfinance,goalsettingandmonitoringoutcomesona

monthlybasis.’

‘ViatrainingforSocialEnterpriseandforboardmembersinreviewprocessonanannualbasis.’

ParticipationinormembershipofmanagementcommitteeThe third aspect of assistance relates to the role of LDCs as participants orperforming roleson the socialenterprisemanagementcommittee.This serviceembeds the LDC staff more intimately into the governance of the socialenterprise,andhasimplicationsintermsofresourcerequirementsfortheLDC,andlearningissuesforthesocialentrepreneur(concerningthefinelinebetweenenablingsocialentrepreneursforthistaskorexecutingitforthem).Withaviewtothelonger-termscalingandsustainabilityofthesocialenterprise,it is imperative that the social entrepreneur develop skills and competenciesrelevanttomanagingandleadingthesocialenterprise.Trainingandcompetencyprogrammes will, therefore, be increasingly needed by social entrepreneurs –whichhasimplicationsfortheresourcesandrolesofstaffinLDCs.Theexamplesdescribedbelowdemonstratetheneedforassistanceinthisarea:

‘ThestaffmemberwithresponsibilityforSocialEnterpriseparticipatesononeManagementCommitteethatwasestablishedin2015to

supportacompanywithnewprojectdevelopment.Oneofthemainreasonsbehindencouragingthiscommitteetobeestablishedwastobringexpertisearoundthetablethatdoesnotcurrentlyexistatboard

level.Itisaworkinprogress.’

‘ParticipationormembershipofSocialEnterpriseManagementCommittee–yesstaffmembersorboardmemberswouldsitonthe

boardofanumberofsocialenterprises.’

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‘Actinanadvisorycapacityonbestpractice.’

‘SDCPserveon47independentboardsincludingservingonsubgroupssuchasHR/Finance.SDCPprovideprofessionalindemnityinsurancefor

thoseservingasdirectors.’

Thegroupsallhavedifferentbackgroundsandspecificareasofexpertiseincluding:Environment,CustomerRelations,BusinessProcesses,HR,Finance,AuditandGovernance,Community,Rural

Developmentetc.’

‘…boardmembersofOffalyLocalDevelopmentCompanybutstaffdonotsitonboardsaspolicydiscussion.’

Thecommentsreflectemergingtrendsandtheassociateddemandsinmanagingthegovernanceandregulatoryrequirementsofthesocialenterprise.Managing governance-related tasks safeguards the mission of the enterprisewhile allowing the social entrepreneur to meet the demands of variousstakeholderssuchasinvestors,employees,volunteers,clientsandbeneficiaries,aswellascomplywithpublicpoliciesandregulations.The research highlights the intensifying demands on LDC staff to beknowledgeable about regulatory and legislative requirements, and on LDCs toallocateresourcesforthedesignandprovisionofdirectsupportsinthisarea.Overall, the results suggest emerging in the hierarchy of services expected bysocial entrepreneurs is a bias in favour of supports inmentoring, training andskillsdevelopmentforgovernanceissuessuchasrgwselectionandrecruitmentof and Board of Directors and human resource management. This presents achallenge for organisations such as LDCs on how to balance the need forstandardised services in these areas with the necessity to be flexible andadaptable to accommodate the requirement for bespoke services from early-stageandestablishedsocialenterprises.The cumulative demand on LDCs to provide a range of direct and indirectsupportshasimplicationsforresourcerequirements.Inmanycases,theservicesto social enterprises are assumed as part of the portfolio of supports to thegeneral population ofmicro, small andmedium enterprises, and thus are notgiventheindependentrecognitionorresourceallocationrequired.

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Moreover, from the LDC perspective, the actual time allocated to the socialenterprisesectorisdifficulttocapture;dependingontheparticularLDC,therolemay straddle individuals or fall under different functional headings. This is notsustainable forLDCsasthedemandsof thesocialenterprisesector intensify. Ifthesectoristobegivenopportunitiesandsupportsequaltothoseprovidedtomainstream entrepreneurs,more resources need to be deployed to LDCs. Thededication of social enterprise-specific resources is an important barometer ormarkerofgovernmentpolicycommitmenttotheadvancementofthissector.As with the allocation of time, similar issues relate to the inability to directlyquantify the financial resources allocated to working with social enterprises;many are costed under supports and programmes such as the RuralDevelopmentProgramme(RDP),LEADER,theLocalDevelopmentSocialInclusionProgramme(LDSIP)andSIDC.Thedesignofadditionalornewsocialenterprisesupports must take account of the current portfolio of resources allocated tosocialenterprises,andforwhatpurposes,asameansofidentifyinghoworifthecurrent support infrastructuresare suitable tobuildon.Themostefficientandsuccessfulmodelsofdirectandindirectsupportalsoneedtobeidentified.Inregionswithalargenumberofsocialenterprises,thisbecomesamoretestingtaskforLDCs.Theimplicationforpolicyisthatinterventionsneedtobedeterminedordevisedtoenablesocialentrepreneurstoleveragegovernanceasameanstoreachtheirhighestpotentialandsustainthecoreethosoftheenterprise.Consideration must be given to initiatives that will enable and build relevantcompetencies among social entrepreneurs while ensuring that LDCs have thenecessary skills and financial and time resources tomatch the needs of socialentrepreneursandthestageoftheenterprise’sdevelopment.

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5.2ThecontributionsthatsocialenterprisesprovideSocial enterprises operate across a wide range of business sectors, and areimportant drivers of social, economic and environmental change. Among theirmanybenefits,itisdifficulttoisolateandquantifytheirsocialandenvironmentalbenefits. To address this challenge, this research attempted to identify thecontributionthatsocialenterprisesmake,andhowandwheretheyaddvalueorbridgeasupplygaptoenhancethelifeandwellbeingoftheirtargetedgroups.The 20 LDCs assisted over 3,376 social enterprise entities, which representedmoreintenseclustersofsocialenterpriseactivity.Thiswasmostpronouncedinlocations such as Ballyhoura and Wexford. Ballyhoura deals with 127 socialenterprise legalentities,whileWexfordLocalDevelopmentNetworkis involvedwith57suchentities,followedbyWestLimerickResources(31)andMonaghanIntegratedDevelopment(22).Theremainingresponsescitedfewerthan20.Whilst the sectors represented are diverse, a large proportion serves thechildcare and health and social care and wellbeing and care for the elderlymarkets. Other enterprises work with specific in-need groups such as earlyschool-leavers,unemployedyouth,elderlypeople,homelesspeople,and thoseleavingprison.Many social enterprises are involved in building confidence and competencies,creating work opportunities for those whowould otherwise find it difficult tosecure a job. There are social enterprises focusing on protecting theenvironment, tackling poverty, revitalising rural communities, and improvinghealth and wellbeing, which cumulatively promote more sustainable localeconomiesandfeedintoamorepositivenationaleconomy.Socialenterprisesalsoofferservices intheareasoffoodandcatering,tourism,arts, culture, music, recycling, transport and distribution, and serve both thebusiness-to-businessandpublic sectormarkets inaddition to sellingdirectly totheindividualmarket.The level of activity in the business-to-business market is strong, andcomplements the revenue streams from the individualbeneficiarymarket. Theenterprises focus on local and regional markets that, in some instances,incorporate large ruralandurbangeographicareasexperiencingeconomicandinfrastructural deficiencies. The benefits of their activities extend beyond thelocal market they serve; social enterprises create spin-off revenue and

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employment opportunities for suppliers and subcontractors outside their localbase.Thiscontributionisnotsufficientlyrecognised.5.2.1EmploymentcontributionInadditiontoprovidingmuch-neededservicestocommunities,socialenterprisesareanimportantsourceofemploymentcreation,accountingforover1,200full-timeand70part-timepositions.Socialenterprisesalsoparticipate inanumberof work placement schemes, offering part-time positions for more than 907people.TheCommunityEmploymentprogrammewas themostpopular scheme,beingthesourceof483employees.Túsprovidedworkopportunities for350people,andJobInitiativeandJobBridgeprovidingtheotheremploymentsources.Theuseofworkplacementschemesisnotable;inparticular,TúsandCommunityEnterpriseschemesareimportantsourcesofemploymentforsocialenterprises,and also provide employment opportunities locally for individuals who mayotherwisefinditdifficulttosecureemployment.For the participant, the opportunity to work with a social enterprise presentsaccesstoworkthatotherwisewouldnotbeavailableduetothelackofrelevantworkopportunitiesorinsufficientqualifications,skillsandcompetencies(e.g.forindividuals who are long-term unemployed, members of marginalised groupssuchasTravellers,formeroffenders,andrecoveringdrugusers).Securing a job enables the individual to build experience and enhance theirpersonalandprofessionalskills,whichrendersthemmorecapableofseek full-time employment opportunities. Additionally, the work experience provides amechanism for individuals to gain confidence and build personal as well asprofessionalskillsandnetworkstopreparethemtore-engagewithsociety.Thisis a fundamental foundation for gaining a sense of belonging and ameans ofcontributingtoacommunityinapositiverole.Ofnoteisthereliancethatsocialenterpriseshaveonvolunteerstoassistintheiroperations; these vary by type of social enterprise. Those offering communityservicessuchasmeals,cateringandretailtendtousevolunteersmore.Thistypeof social capital represents a significant non-monetary resource for socialenterprises, contributing voluntary labour and managerial skills at differentlevels.Inviewofchanginglifestylesandtheregularlyciteddifficultyin‘recruiting’newvolunteers, socialenterpriseswillneed to considernewwaysofattractingand

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retaining volunteers, and embedding them more personally into the socialenterprise.Asthesocialenterprisescalesup,thesocialentrepreneurneedstoconsiderhowbesttobalancethemixofvolunteersandemployeesfromplacementschemes,andfull-andpart-timeworkers.Socialenterprisesare importantsourcesofemployment,but it’snot justaboutemploymentcreation.Weneedtotakeaccountofthenatureandvalueofthejob to the employed person, and indeed the cost savings to the broadereconomyaseachjobreducestheneedforfinancialsupportbytheState.The multiple spin-offs (social, personal, economic) emanating from the socialenterpriseareexemplifiedinthemanyindividualandcommunitybenefits,whicharebestcapturedinthecommentsofrespondents:

‘Threecompaniesoperateinthissectoremploying21staffandwithacombinedturnoverin2014of€589,557.Onepart-timepermanentpositionhasbeencreatedbyonecompanyfromitsownincome.’

‘Thecompanymanufacturessilkflowerwreathsthatitsellsinto14countiesintheBMWregion.Italsohasanumberofprivatecontractsfromlocalmanufacturingcompanies.Itprovidessocialemploymentfor

peoplewithdisabilities(bothphysicalandmental).Intotal44individualsareemployedbythecompany,madeupof15CSP-fundedstaffand9staffthatareinreceiptofaWageSubsidyfromDSP.TheremainingstaffarereferredfromthelocalHSEtrainingcentresforPeoplewithDisabilities.Theturnoverfor2014wasintheregionof

€479,393.’

‘GalwayRuralDevelopment–BallinasloeEnterpriseCentre180people–14businesses235enterprises,theyareresponsibleforelderlyinvarious

formsandviewedaskeyYouth–jobcreationandprovidingthat‘missinglink’heretoforeaddressedbyapprenticeshipsBallyhouraand

CanalBank.’

‘PeoplecometoTECtoavailofourenterprisesupportsaresurvivingonsocialwelfarepayments.Thebenefitsofstartinguptheirownviablebusinessarelifechangingbothfinanciallyandpersonally.Small

businessestendtorelyontheirlocalcommunitybothfortheirsuppliesandtheircustomersandsoself-employmentnotonlyimprovestheirownqualityoflifebutalsothatoftheirlocalcommunity.TEChaveparticipantscompleteafeedbackformafteralltheircourses.’

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‘Atotalof128individualsareemployedby9businessesinthissectorwith35oftheseinfulltimeemployment.Employmentfromown

sourceshasbeenprovidedfor2.5fulltimestaff.Thecompaniesmakeaconsciousefforttosourcesupplierslocallythereforeensuringthattheyaresupportingthelocaleconomy.Thetotalturnoverfortheninecompaniesin2014was€2,404,906.’

‘Threecompaniesoperateinthissectoremploying47staffandwitha

combinedturnoverin2014of€770,130.Twostaffmembersareemployedfromincomegeneratedbythecompanies.’

‘1stSportsandRecreation–Approx.50jobscreatedandturnoverof€4

million2ndHealthandSocialCare–Approx.25jobscreatedandturnoverof€2

million3rdChildcare–Approx.18fulltimeand20parttimejobsandturnover

of€2million4thEducationandTraining–Approx.12fulltimeand12parttimejobs

andturnoverof€1.5million’

‘Childcareindisadvantagedareas,recyclingopportunities,Europe’sonlyfreedoortodoorcollectionofelectricalgoods–operatingingreaterDublinarea’

‘Employmentforpeoplewhowouldnototherwisefindajob.Mentoringclientscomingfromdisadvantagedbackgrounds,upskillingandcapacitybuildingisakeyfeatureoftheenterprise.Thisiscrucialtoenablingpeoplethathavebeen

‘leftbehind’toenhancetheiremployabilityandimprovetheirchancesofgainingworkthatpaysalivingwage.’

Twoof the CSPswere established to provide social employment opportunitiesforpeoplemostdistantfromthelabourmarket.Bothcompaniesemploypeoplewith disabilities andmembers of the Traveller Community. Feedback receivedwhenvisitingthecompaniesduringtheresearchprocessincludes:

‘Thereisareasontogetoutofbedinthemorning.SometimesIcanworkgreatbutothertimesIamnotabletodoalot.Thisisok.’

‘Themajorityofemployeeswouldnotfindemploymentelsewhereduetothe

natureoftheirbackgrounds;excludedandearlyschoolleavers.’

‘Theenterprisenotonlyprovidesemploymentfordisadvantagedpeople,itoffersafullyaccessible,multi-purposebuildingthatisusedbyawiderangeof

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communitygroupsthathirethecentreatcommunityrating.Itisalsotheonlydedicatedconferencecentre,trainingfacility,meetingrooms,trainingrooms,

amplefreecarparking,organicfarmshop,attracts36–40‘sabbaticalstudents’thatcontributetothelocaleconomy(biannually).’

5.2.2TrainingandupskillingcontributionInadditiontoemploymentcreation,socialenterprisesprovideamechanismforupskilling and training to individuals who have limited access to mainstreamtraining opportunities Examples of these are presented in the respondentcommentsbelow:

‘Yes,opportunitiesforpeopletotakeon-the-jobtrainingandworkexperience,aspartofanaccreditedprogrammeorasvolunteers.’

‘Alloftheenterpriseshavecreatedemploymentinareasthatwouldbe

unsustainablewithintheprivatesector.’

‘Developmentofprojecttothelevelwhereithasthepotentialtocreatejobopportunities.Enhancingskillsoflocalcommunitymembersthat

couldbeusedtosourceemployment.’

‘TrainingProgrammessuchastheLTIandBTEIprovidetrainingandjobopportunitiestodisadvantagedyouth.Newapprenticeshipdirectorsin3

SEsallu25yearsandfromdisadvantagedareas.’

‘Placementandtrainingprovidedtodisadvantagedwhichcouldnotbeaccessedintheprivatesector.’

5.2.3SocialcontributionsTheprovisionofemploymentasamechanismfordisadvantagedgroupstoavailoftraininghaspositivepersonalandcommunityimpacts.Thesespananumberof avenues of regeneration of locations, stimulating a sense of wellbeing andbelongingformarginalisedindividualsandregions.The combined economic and social benefits have a synergistic impact on eachother;where there is economic activity, individuals can find employment, andthe monetary contribution to the local economy then adds vibrancy to theregion,aswellasasenseofpride,asthefollowingcommentsindicate:

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‘Enableactivityinruralvillagesandsmalltownthatwouldotherwisebedeemednotvalueformoney.’

‘Providingculturalandrecreationalinfrastructurewhereitisnotviable

todosoonafor-profitbasis.’

‘Enhancestheculturalandsportinglandscapeinruralareas.Provideseducationalandtrainingandemploymentopportunitiesin

disadvantagedruralareas.’

‘ThereisademonstrablesocialgainthroughtheexistenceoftheActiveITSociety.Thedigitalskillscoursesarenotableintermsoftheirsocial/communityoutcomesasthefeedbackcommentsfromparticipantsaresignificantlypositive.Therespondentsrepeatedlyrefertoenhancement

intheirliveswithclearevidenceofthedigitalgapbeingclosedasparticipantscommentthattheycannowshareinformationandphotosaswellasparticipatingindigitalmediaandsocialtechnologywiththeir

families,friendsandcommunities.Theconnectionsmadebetweenparticipantsonthecourseisalsopositiveasitbringsthelocal

communitycloserasolderpeoplewithsimilarinterestsarebroughttogetherandabletobuildandmaintainfriendshipsthroughtheir

newfoundskills.’

‘Improvedmyqualityoflifeconsiderably.’

‘Iaminmymid-seventiesandgotapresentofaniPadlastyear.WhileIamfamiliarwithalaptopIcoulddonothingwiththeiPad.IcannowdoalmostanythingIwanttoonitbutIgreatlylookforwardtolearning

more.’

‘AITShasbeenveryhelpfulindevelopingsomenewskillsIotherwisewouldnothavehadaccessto.’

‘Encouragementofyoungerpeoplethroughvolunteerismand/orAllotments,withpotentialfortrainingandemploymentinfuture.’

‘Improvedlocalservices,employmentopportunitiesformarginalisedgroups,people-centredmodelofeconomicgrowth.Localemploymentaidingthedevelopmentofself-esteem,feelingapartofthecommunity,

makingacontributiontosociety.’

‘ServicestoolderpeoplesuchasMealsonWheelsmeansthatthereisdailycontactforsomeindividualswhomaynototherwiseseeanyone.’

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‘Socialenterprisesaregenerallywellpositionedtodowhattheprivateandpublicsectorsarenotdoingadequatelyoratall.Like-minded

individualsworkingtogetherandnotfor“themselves”orfor“profits”canachievegreatthings.Socialenterprisessuccessfullytacklesocial

inclusionissuesbutarerestrictedduetounpredictablefundingsupports.’

.‘Theenterpriseinquestionherewouldnotbesustainedbyaprivate

ownerasitwouldnotgenerateenoughprofit(atpresent).Manypeoplelocallywouldsay(ifasked)thattheexistenceofthecentre,a70acrefarmintheverymiddleofanurbancentre,isunique.Itisacentreofexcellenceintheprovisionofcommunityspaceandorganicproduceaswellasrecreationalamenitiesandtheprotectionofrarefloraand

fauna.Itsexistencealsoallowschildrenfromveryurbanisedplacestovisitaworkingfarmandlearnabouthowfoodisproducedandthe

damagethatchemicalsdototheenvironment.’

‘Developmentofprojecttothelevelwhereithasthepotentialtocreatejobopportunities.Enhancingskillsoflocalcommunitymembersthat

couldbeusedtosourceemployment.Allowsolderpeopleandpeoplewithdisabilitiestoliveindependentlivesindignitywithintheirowncommunities(NorthKerryOlderPerson’sDayCareCentre/shelteredhousingprovidemealsandcateringservicesto

theelderlyandrural-dweller.’

‘Providesservicestosociallyexcludedthusaddressingsocialexclusion.’

‘EmploymentandtrainingopportunitiesforlocalpeopleinanareawithDesignatedDisadvantagedstatus.’

‘Bringsacommunitytogethertopositivelyrespondtotheneedsoftheir

localityandempowerspeople.Providesvitalservicesacrossmanysectorsforlocalcommunities.

Mentoringclientscomingfromdisadvantagedbackgrounds,upskillingandcapacitybuildingisakeyfeatureoftheenterprise.Thisiscrucialto

enablingpeoplethathavebeen“leftbehind”toenhancetheiremployabilityandimprovetheirchancesofgainingworkthatpaysa

livingwage.’

‘Thefundingofstaffforruralcommunityhallshasgivennewlifetowhathadbecome“whiteelephants”.Thefacilityofadedicated

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caretakerwithinaprojectcannotbeoverstatedintermsofthedevelopmentofservices.’

‘Theenterprisefocusesongrowing,sellingandpromotinguseof

organicfoodsandencouragingasustainablelifestyle.Itcomprises2xelements,organicfarmingandanecologycentre.’

‘Itoffersafullyaccessible,multi-purposebuildingthatisusedbyawiderangeofcommunitygroupsthathirethecentreatcommunityrating.Itisalsotheonlydedicatedconferencecentre,trainingfacility,meetingrooms,trainingrooms,amplefreecarparking,organicfarmshop,attracts36–40‘sabbaticalstudents’thatcontributetothelocal

economy.’

‘Socialenterprisescanhaveatripleheliximpact–economic,socialandenvironmentalthroughdirectjobcreationaswellascontributingtoawiderangeofcommunityandsocialservices.Theydeliverarangeofbenefitstomarginalisedcommunitiesnotadequatelyservicedbythepublicorprivatesector,toincludedeliveryofgoodsandservices,

therebycontributingtothesocialdevelopmentofcommunities.Theyprovidejobopportunitiesespeciallyforthoseunabletoaccess

mainstreamemploymentforavarietyofreasons.’

‘Childcareindisadvantagedareas,recyclingopportunities,Europe’sonlyfreedoortodoorcollectionofelectricalgoods–operatingingreater

Dublinarea.’

‘Providesopportunitiesforpeopletovolunteerandenhanceworkreadiness,empowermentofstaff,guidedwalks,venue/&tutorsforeducationcoursesonenvironment,cosmology,sustainablelivingforadultsandchildren(linkswithlocal2ndlevelschoolsreprovisionofTransitionyearprogrammesontheseissues).Exposeschildrenand

adultstoknowledgeonenvironmentalissues…’

‘Reducedisolationandincreasedfamilycohesionandwellbeing.’

‘EnablingthecontinuationanddevelopmentofcommunityandnewinnovativeprojectswithinareasofsignificantdisadvantageandwithspecifictargetgroupsthatweresupportedthroughpreviousState

communitydevelopmentfunding.’

‘Increasedfamilycohesionandwellbeing.’

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‘Socialenterprisesaregenerallywellpositionedtodowhattheprivateandpublicsectorsarenotdoingadequatelyoratall.’

There are mutual advantages between the economic, social and financialbenefits which are inextricably linked accruing form social enterprise activity.Thus, focusing excessively on one area misrepresents the embedded andmultifaceted contributionsof social enterprises.A vibrant social enterprisewillbring financial benefits to the local economy as money earned locally will bespent locally, and this may result in increased employment and capitalexpenditureinthearea.The contribution of the social enterprise sector highlights some keymessageswhichareimportanttoconsiderintherecognitionofthesectorandinvalidatingtherationaleforfundingmoretargetedsupportsundergovernmentpolicy:• Socialenterprisesprovideanimportantmechanismforachieving‘inclusive

growth’,wheremarginalisedgroupswhoarenotincludedwithintheeconomybenefitfromeconomicgrowththroughparticipationinthesocialenterprise.

• Socialenterprises–throughemploymentcreation,theuseoflocalresourcesandaddressinglocalproblems–provideamonetarycontributiontothelocaleconomy,whichaddsvibrancytotheregionsinwhichtheyareactive.

• Successfulsocialenterpriseinitiativesbuildonlocalcapacitiestoaddresssocial,economicandenvironmentalproblems.

• Socialenterprisesareengagedandembeddedinlocalcommunitiesandusetheirknowledgeandnetworkstofindsolutionsfortheirproblems–thusprovidinglocalownershipinsolvingproblemsinasustainablemannertoachieveindividual,community,andregionalcohesionandregeneration.

Therangeofbeneficiariesofsocialenterprisesandtheirgeographicscalepointstothevaluablecontributiontheymaketolocalcommunities,botheconomicallyandsocially.The localisedservicesprovidedby socialenterprisesareoften thetypes of services that would otherwise not be available to people who liveoutsideofmajortowns.Themultiplicityof impactsandthevariedbusinessmodelsofsocialenterprisesmakes it difficult to evaluate their activities. An examination of the currentpracticesof thisareawill identify thepractical issuesencountered incapturinginformation to truly reflect the multidimensional contributions of socialenterprises.

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EvaluationchallengesThe level of evaluation undertaken by the respondent LDCs, combining formaland informal methods, varied. In the assessment of social enterprise activity,issuesarisewhenitcomestocapturingsocialenterpriseoutcomesandoutputsin the evaluative metrics and frameworks applied by government; these arepredominantly designed for evaluating the broader population ofmicro, smallandmediumfirms.Theseframeworksdonottakeintoconsiderationtheuniqueand differentiating characteristics of the activities, objectives and benefits ofsocialenterprises,whicharequalitativeandhavelonger-termobjectives.The approaches to and difficulties encountered in evaluating social enterpriseperformancearedetailedinthefollowingcommentsbyrespondents:

‘Atthemomentwedonothaveaformalevaluationprocessinplace.WeworkcloselywiththePobalstaffmember.Wehaveyettoput

metrics/indicatorsinplacethatwillmeasuretheimpactandoutcomesofthesupports/resourcesprovidedtotheCSPsundertheSocialInclusionandCommunityActivationProgramme.ThenationalindicatorsfortheSocialInclusionandCommunityActivation

Programmearequantitativeinnatureandcapturethenumberofbusinessessupportedandnewinitiativesdeveloped.Thereisan

opportunitytodevelopindicatorsthatwillcapturethediverserangeofsupportsandresultingoutcomesduringtheprogramme.Thisisawork

inprogress.’

‘NoformalevaluationprocedurebutattendanceatBoardmeetingsisamechanismfordoingso.Keyindicatorsinclude:No.ofpeopleemployedbythecentre/enterprise;No.ofpeoplefromdisadvantagedgroupsthatareemployed;No.oflabourmarketparticipantsemployed;RotationofBoard;CompliancewithGoodGovernancevisH&S,ChildProtection,FinancialManagementetc;No.ofsocialinclusionfocusedgroupsusing

thecentre.Contributiontolocaleconomy;wages,incomefromPobalunderCSP,

leverageoffundsfromPhilanthropicbodies/No.ofVolunteers,protectionoftheenvironment(canbemeasuredbyapproval/

compliancewithOrganicregs),Socialinclusionfocus.’

‘Whilstquantitativeresearchoftenliesmorecomfortablywithgovernmentdepartments,weencouragetheintegrationofbothaqualitativeandquantitativeapproach(wherepossible)tohelpustoconsiderbothsidesofthecoinwhiledemonstratingtherealitybehindthenumbers.Totrytoevaluatethesocialenterprisesexclusivelyfroma

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quantitativeperspectivefailstounderstandorappreciatethehumandimensionofcommunityworkandismuchlesslikelytodemonstrate

thereal“humanfaces”andreasoningbehindthosefigures.Furthermore,aquantitativeevaluationapproachwouldnotincludethearrayofnon-financialcostsandbenefitswhichoftenemergefromthistypeofevaluation,forinstancethereducedlevelsofisolationandthe

increasedsafety&security.Thiswouldbeamissedopportunityintermsofaccuratelyrevealingthetruevalueformoneyofasocialenterprise.’

‘Allprojectsthatreceivefundinggothrougharobustevaluationprocesswhichexaminesthepotential/enterprisestobesustainable,realistic,

generateemploymentandmeetthesocialneedsoftheirarea.’

‘Capacityofthemanagementcommittee;financialviability;DemandfortheServicesDisplacement;JobCreation.’

‘QuantitativeIndicatorsQualitativeCaseStudyEvaluations.’

‘Fullydevelopedintoformalprocesses.SDCPstaffmembersaretrained

ingovernanceandsomeinfinancialoversight.’

‘Self-evaluation,participantcenteredevaluation.’

‘OurprocessofevaluatingasocialenterprisefallsundertheevaluationprocessesoftheRDPandLCDPguidelines.’

‘Thisprojectisstillinthedevelopmentalstageanditisdifficulttoprovideanevaluationmethodology.Alldevelopmentsarecarefully

monitoredandreportedandthisprocesswillcontinue.’

‘SocialenterprisesarecarefullyassessedbyrelevantLDCstaffandBoardrepresentativespriortoengagingintheprovisionofservices.

TheyaresubsequentlymonitoredonanongoingbasisviadirectcontactwithLocalDevelopmentCompanystaff.’

Thecommentshighlightissuesbothintheprocessofevaluationandthemetricsor criteria applied to measuring social enterprise performance. The LDCrespondents are intimately familiar with the benefits that social enterprisesprovide both socially and economically and at the individual and communitylevels,butyetareunabletopresentthistorelevantgovernmentstakeholders.

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Thepracticality inevaluatingsocialenterpriseperformancemakes itdifficult todescribe their multifaceted social and economic influences, resulting in anunderestimation of their true impact. Consequently, it is difficult to present acompelling case for financial government supports for social enterprises. Fromthesocialentrepreneurperspective,beingunabletousethemetricsappliedtomainstream enterprises diminishes their contributions and organisationallegitimacy.

5.3OpportunitiesandchallengesfacingsocialenterprisesTheroleandcontributionofsocialenterprises,andthedifficultiesinevaluatingtheirperformancehavebeenoutlinedabove.Thefinalsectionofthesurveyhasan eye to the future, focusing onwhich sectors are viewed as holding growthopportunitiesforstart-upandestablishedsocialenterprises. The responses indicate opportunities for social enterprise activity across anumber of sectors, some of which build on those sectors where socialenterprisesoperate,while somenewsectorsalsoemerged. Table2.0presentsthemostcommonlycitedsectorsprovidingopportunitiesforsocialenterprises.

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Table2.0:Opportunitiesforsocialenterpriseactivity

• Healthcare/wellbeing–somesuggestionsindicatedtheaddedvalueofapplyingtheuseoftechnologytotheprovisionoftheseservices;wellbeing-focusedprojectswerementionedonanumberofoccasions.

• Educationandprovisionofonlinelearningandlifelonglearning

• Environment-relatedprojects–community-ownedrenewableenergyprojectse.g.windfarms

• ThesocialfarmingmodelaspilotedintheBordercountieshaspotentialtobedevelopedasasocialenterprise,withadualfocusonthosemarginalisedinsocietyaswellasfarmerssufferingruralisolation.Communityshopshaveprovenpotentialundertherightcircumstancestoaddressruraleconomicdeclineandruralisolation.

• Publicprocurement–thereisachangeemergingfromdifferentgovernmentdepartmentswherebythedeliveryofservicesisbeingpursuedthroughpublictendering.Thereisanopportunityforbusinessestobeestablishedinthisareatosupportotherbusinessestowinpubliccontracts.

• Pre-schoolandafter-schoolchildcareinsmallruralvillages,andinparticularforsingleparentswhowishtoreturntowork.Alsoopportunitiesinvolvingchildrenwithspecialneeds.

• Carefortheelderly,asmanyolderpeoplearelivinginfrugalcircumstances.Inonecomment,itwaspointedoutthatthissocialneedisnotcurrentlybeingadequatelyaddressedbyeithertheprivateorpublicsectorentitiesinDuhallow.Oranywhereelse?!

• Community-ledand-basedprojectssuchascommunityshops,cafesandcommunityhubs,socialandcommunityhousing

• Projectstoaddressmarginalisedanddisadvantagedgroups,inparticularunemployedyouth,peoplewithadisability,etc(withcontractssecuredthroughtheCommunityBenefitClausesandSocialProcurement)

• Projectstoaddressruraleconomicdeclineandruralisolation(e.g.communityshopsandpubs,basedonUKexperience)

• Tourism,recreationandheritageproductsandservices

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The ability of the social enterprise to leverage these opportunities relies on anumber of external factors, relating to support and recognition, and internalfactors relating to the skills and competencies of the social entrepreneur andtheirresourcebase(peopleandfinance).Fromtheexternalperspective,respondentcommentsstressedthatthecurrentlack of understanding of or myths associated with social enterprises requiredattentionastheylimitedadvancementoftheoverallsocialenterprisesector.Theimportance of increasing awareness of social enterprise activity and how theybenefit local and regional economies at the policy, funder and general publiclevelsareconfirmedinthefollowingcomments:

‘Theneedforheightenedrecognitionnationallyandatpolicylevelwasviewedasfundamentaltosecuresupportandassistance.’

‘Thesectorneedstoberecognisedandsupportedatanationallevel.Accesstofundingatstart-upphase.Clearaccesstosupportsandprovisionoffullrangeofsupports(iebusinessplanning,financial

planning/budgeting/strategicplanning/HR/Governance/recruitmentandcapacitybuildingforboardmemberson

allaspectsofthebusiness).Networksofenterprisesasasupportandlearningmechanism.’

‘Thereneedstobeapolicycommitmentwhichrecognisestheroleandthepotentialrolethatsuchenterprisescanhaveandtotheremovalofbarrierstosupportandengagementfromthetraditionalenterprise

supportsector(LEO).Thereisagreatdealofconfusionregardingwhatisandwhatisnotasocialenterprise,acommunityenterpriseetc,andthereappearstobeareluctancetoengagewithsocialenterprisesfromkeysupportagencies.Attheendofthedaytheseareenterprisesandneedtooperateassuchalbeitthosesocialobjectivesareasimportantasthetradingcapacity.TheForfásreportrecommendationsprovideagoodstartingpoint,asdothoseinthereportonsocialenterprisesfrom

theCountyKildareLeaderPartnership.’

‘AparticularpolicyfocusonSocialEnterpriseaswasavailabletocommunityenterprisedevelopmentinFASinthe1980’sand1990’sand

viatheCommunityServicesProgrammeintheearly2000’s.’

‘Needtounderstandwhattheyareinthefirstinstanceandalsoprovidestaffsupportingservices.’

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Enablingthesocialentrepreneurtoavailoftheopportunitiesidentifiedaboveisdependent on the possession of managerial and leadership competencies,particularly in financial management, human resource management andgovernance. The social entrepreneur also needs to adopt amore professionalapproachtotheoperationsandmanagementoftheirenterprise.Policies and interventions to enable social entrepreneurs to adopt such aprofessional approach necessitate an understanding of the challenges theyencounter, both internally (skills and competencies) and externally (economic,regulatoryandfinancialissues).Respondents were asked to indicate the primary internal and externalenvironmental challenges facing start-up and established social enterprises inleveragingthepotentialfromtheareasofopportunityidentified.Theresponsespoint to the most appropriate direct and indirect supports required by socialenterprises. The challenges facing the start-up social enterprise are shown inTable3.0.

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Table3.0:Challengesencounteredbystart-upsocialenterprises

InternalChallenges ExternalChallenges

Financial/legalimplications Over-regulation

Structureofmanagementcommittee

Volunteerswithresponsibilityofrunningcommercialbusiness

Feasibilityofbusinessmodel Findingsuitablepremises,negotiatingleases,accessingfunding,mentoring

Managementexperience Regulationcosts,changesinfundingcriteria,lackofstart-upcapitalsupports

Governance Engagingwithgovernmentfundersandoversightbodies

Strategy,marketing,HR Governmentsectoralandemploymentpoliciesandnot-so-flexiblegeneralregulations

Professionalisationofoperations

Lackofunderstandingofpolicesandregulationsorhowtocomplywiththem

Lackofvoluntarycommitment Expectationsofwhatcanbedelivered–finders,communities

Complianceissues/bureaucracy

Lackofinformationandsupports‘ontheground’

Businessplanning

Needforbusiness-likeapproach ThefollowingcommentssupportthechallengesidentifiedinTable3.0:

‘Itisvitalthatarangeofstart-upsupports,advisoryandmonetary,are

madeavailable,leadingtogrowthandthecreationofeconomicopportunitiesatlocallevel.’

‘AswithallSocialEnterpriseinitiatives,inlinewiththekeychallengesasidentifiedbytheForfásreportonSocialEnterprisesector.NamelykeychallengesidentifiedbySocialEnterpriseswere“Therewillneedtobe

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anemphasisonprovidingthenecessarysupportsinovercomingthechallengesidentifiedabove.’

‘Theviabilityofsocialenterprisesisverydependentondedicatedvolunteersandgoodteamworkandcommunityspiritinthelocal

community.Mostcommunitygroupscurrentlyrunsometypeofsocialservice/socialenterprises.CommunityGroupsneedbettersupportfromstatutoryagenciesinrelationtoregulationetc.Volunteersrunning

socialenterprisesrequireprofessionaltraininginareasofemploymentlaw/humanresources/legalissues/governance.’

‘KeychallengesidentifiedbySocialEnterpriseswere“management

development,financialmanagementandplanningandhumanresourcemanagement.”Therewillneedtobeanemphasisonprovidingthenecessarysupportsinovercomingthechallengesidentifiedabove.’

‘Capitalfundingforviableprojects,andemploymentsupports.’

Therewasa similarity in thenatureof theexternal challengesencounteredbystart-upandestablishedsocialenterpriseswiththeemphasisonoverregulationand bureaucracywhich is stifling growth and expansion and consumes a largeproportionofthesocialentrepreneurstime.Therangeof internalandexternalchallenges encountered by established social enterprises is displayed in Table4.0.

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Table4.0:ChallengesencounteredbyestablishedsocialenterprisesInternalChallenges ExternalChallenges

Managementofappropriatestructure,rolesandresponsibilities

Corporategovernance/boardofdirectors

Humanresourcemanagement(multiplementions)

Financialmanagementandaccesstofinancetogrow

Managingsurpluses/Reinvestinginthebusiness

Pressuretoraisewages

Alackofyoungervolunteersanda‘burnout’factorwithexistingvolunteers

Accesstonetworkingopportunities

Strategicplanning

Howtoscaleupandinnovate

Engagingwithrelevantgovernmentfundersandoversightbodies

Governmentsectoralandemploymentpoliciesandgeneralgovernanceregulations

LegislativechangesinareassuchasFeed-inTariffsforRenewableEnergy

Publicprocurementcommunitybenefitsclauseslegislation

Attractingtalentatmanagementandstafflevel

Lackofunderstandingofpolicesandregulationscoveringsocialenterprises

Thefollowingcommentssupporttheabove-mentionedchallengesfortheestablishedsocialenterprise:

‘SignificantchallengeforSocialEnterprisesistosetupandmaintainagoodmanagementstructurewithinthebusiness.Astrongandcapable

managerisoftenthekeytothesuccessofaSocialenterprise.’

‘Tenderingforcontracts,improvedfinancialplanning,scalingupservices,mergersofprojectstoreducelegal,auditandothercosts.

Mergersofboardstocreatesustainablegovernancemodel,trainingformanagers,betterstrategicanddevelopmentalplanning,provisionof

developmentfunding.Managingsurplusesinawaythatusesfundswellandavoidsstatewithdrawalwillbekeyforsuccessfulenterprises,willbeanimportantstepforlong-termsustainability.ProfessionalizationinallaspectsofthebusinesseswillberequiredifSEsaretocompetewith

privatecompanies.’

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There is consistency about the challenges facing both the start-up ande