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Investing in Alternative Economic Futures: Lecture

Posted in Movements by Kate Archdeacon on April 7th, 2010

Source: Social Traders

‘INVESTING IN ALTERNATIVE ECONOMIC FUTURES’  The Inaugural Social Business Australia (SBA) Lecture Parliament House Canberra, Monday 15 March 2010, delivered by Dame Pauline Green, President International Co­operative Alliance (ICA)

Social Business Australia is a new organisation that was created to assist all forms of social business to develop and grow in the competitive environment of the economy. Social businesses trade or undertake activities for social purpose and apply profit or surpluses for social benefit. They include co-operatives, mutuals, credit unions, employee owned businesses and some social enterprises. Social enterprises have been recognised around the world as effective and sustainable models for delivering long-term positive social impact.

“These governments defend and promote social business as tried and tested solutions for economic, social and environmental problems and, with their support, the social businesses in those countries have been actively developing new ‘co-operative’ structures to bring solutions to 21st century problems, in particular recently in the environmental and energy fields.”

From the lecture, available for download:

Social businesses are based in their local community, are often owned and controlled by their communities. They keep local services in the hands of local people, for local people. Unlike investor owned businesses, the first priority of a social business is not to maximise profit to ensure an ever-increasing payout to shareholders. Rather a social business has multiple bottom lines and their surpluses are used:

  • To reinvest in the business to ensure that it is meeting the investment needs of the business, understanding that without a successful business, we cannot meet any social objectives;
  • Some, like co-operatives make an economic return to their owner members thereby supporting the local communities in which those social businesses are based, keeping wealth local, and helping to grow local economies;
  • Most if not all, invest directly in the local communities themselves, supporting the young, the vulnerable and hard to reach parts of society, but also trying to stimulate the growth of the social business economy within its trading reach.

….In some countries it is a popular misconception that social businesses are structures only for managing social inclusion or worklessness. Whereas, in reality, they are businesses that can change the future of local, regional and national economies and, they are incredibly significant right now, in the context of their reach into local communities, and in their contribution to social evolution and national economic development in countries from as far afield as Japan to the UK, Sweden to the US, India to Italy to name but a few.

….Perhaps one of the most telling facts in favour of support for the new and emerging co-operative and wider social business sector, is that successful economies almost always have a rich diversity of business forms.  For instance the most co-operative economies in the world are those of Finland, Switzerland and Sweden! These are some of the most admired societies in the world – admired for their social cohesion, their equality, their progressive attitude to social and environmental policy, but also successful commercially and financially, with arguably the best standards of living in the world.

In Finland the contribution to the nations GDP from the co?operative movement is 21%. Once again, a very significant figure in the economic life of any country.  How has this happened?  These governments defend and promote social business as tried and tested solutions for economic, social and environmental problems and, with their support, the social businesses in those countries have been actively developing new ‘co-operative’ structures to bring solutions to 21st century problems, in particular recently in the environmental and energy fields.

The UK government department responsible for energy was so impressed with the case study of community energy generation in the Scandinavian countries that was provided by Co-operatives UK, the co-operative apex in the United Kingdom, that it funded a fact finding mission to Scandinavia, and are now busy supporting the development of just those responses as part of the UK approach to climate change and reduction of carbon emissions – the development of community owned and managed local wind energy plants, hydro energy installations, photovoltaic fields and so much more.

I’m pleased to recognise the Hepburn Wind Farm Co-operative, the first community-owned wind farm has raised more than 90% (7.3 million) of project costs from 1070 members….

Read the full lecture by Dame Pauline Green, via Social Traders.

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