2022-11-30_European-Parliament_Setting-the-Scene_Social Innovation A Drive to Positive Change.pptx

Presentation at the European Parliament on Social Innovation and Social Entrepreneurship to drive the transformation to a more inclusive and sustainable society and economy and reaching the UN Sustainable Development Goals

1. Setting the Scene: Social Innovation a Drive to Positive Change European Parliament 30 November 2022 Wieteke Dupain, Head of Knowledge, Research and Market Development

2. Euclid Network European Social Enterprise Network — T ransnational umbrella organization for social enterprise and social innovation intermediaries and support organisations Members and partners are frontrunners in social enterprise, social innovation and ecosystem development : national networks and alliances,  universities, research centres, incubators, accelerat ors, social (innovation) funds Fast-growing network with 45+ members in 26 countries and active in 50 + countries (Strategic) partner to the European Commission , United Nations, World Economic Forum , cities and regions Representing over 100.000 c ivil s ociety , s ocial e nterprise, and social innovation organisations across Europe and beyond P rograms and representation of social entrepreneurs and social innovators in Europe, Russia, the Middle East and North Africa

3. What We Do Transnational Networking, Knowledge Exchange and Peer Learning Building and Leading Partnerships , Consortia and National Ecosystems for Social Enterprise and Social Innovation C ross - Border Access to Knowledge and Research Access to Markets , Funding and Skills Generating Visibility and Awareness, Advocating, Influenc ing Policy

4. Social Innovation and Euclid Network Social innovation is increasingly important to address the social and environmental challenges we face. The Action Plan for the Social Economy, launched in December 2021, strongly underlines the importance of social innovation and notably the role of the European Social Fund (ESF+) in this respect. Social innovation is a rapidly-developing aspect of ESF+ funding and supports addressing the European Pillar of Social Rights, Circular Economy Action Plan, Green Deal, Social Economy Action Plan. The ESF+ stimulates social innovation in three complementary ways: Article 14 of the ESF+ Regulation. Every Member State to dedicate at least one priority to social innovation. The Employment and Social Innovation (EaSI) strand supports social innovation and experimentations, including providing funding to support organisations → Euclid Network - as transnational social enterprise, social innovation, social finance support organisation - is a Framework Partner of ESF+ EaSI (Employment and Social Innovation) strand 2018-2022, 2022-2026. Peer Framework Partners: EVPA, EMN, RREUSE, ENSIE, Budget of EUR 197 million allocated to support the scaling-up and replication of innovative solutions through transnational cooperation. This new initiative is called “ESF Social Innovation+” and will be implemented at EU level by the Lithuanian ESF Agency “ESFA”1. The initiative includes two components: Grants for projects supporting the scaling-up and replication of innovative solutions A European Competence Centre for Social Innovation Many EN members and partners are part of the European Competence Centres for Social Innovation initiatives : Avise, Shipyard, Forum for Social Innovation, Reach for Change Bulgaria, Synthesis Cyprus, (Sociale Innovatie Fabriek)

5. Influencing the Future of Social Enterprise and Social Innovation in Europe Aims Close the current social enterprise data gap Inform decision-makers in government, academia, business and civil society on the needs and challenges that social entrepreneurs/social inno vators experience nationally and across Europe Influence future strategies, funding, policies, regulation and legislation to better support social enterprises /social innovators across Europe Conceptualisation & Methodology (Bi-)annual research study leading to the production of localised national reports and a comparative European report Survey conducted today across 21 countries in 21 languages Reason /Impact To enable the transition towards a more socially inclusive, fair, green and digital society and economy Reach the UN Sustainable Development Goals by 2030 Social enterprises are key leading actors in the needed transition

6. Countries 1st year & 2nd year 2020-2021 (8 …. ) Croatia Denmark Estonia Germany Portugal Spain Sweden United Kingdom Austria Bulgaria France Hungary Ireland Italy Latvia Poland Serbia Slovenia Switzerland The Netherlands Türkiye (21 …. ) 2021-2022

7. Social Enterprises Social Enterprises: “operators in the social economy whose main objective is to have a social and environmental impact rather than make a profit for their owners or shareholders. Financial income is a means and not an end in and of itself”.

8. Median age of 7 years; 82.7% founded in the past 20 years 61.6% in the implementation & growth stages of development Active in all UN ISIC industry sectors (though 11.1% not fully or at all classified by standard categories) 26.1% are active across multiple sectors Utilise 158 different legal forms 8.1% are legally hybrid YOUNG AMBITIOUS DIVERSE FLEXIBLE 91.0% intend to scale (Portugal: 100%) (most commonly through diversification, partnerships & marketing); 79.9% plan multiple scaling strategies INNOVATIVE 85.5% took innovative approach(es) at founding , all solv ing social and/or environmental challenges 55.4% perceive technologies as relevant for their impact/business model Defining Characteristics of ESEM SEs 2021-22

9. Purpose & Impact of ESEM SEs GOALS Targeting all 17 UN Sustainable Development Goals (SDGs) , most commonly #8 : decent work & economic growth, #3 : good health & wellbeing, #10 : reduced inequalities 83.2% target multiple SDGs RANGE 51.4% create impact at multiple geographical levels, ranging from their local communities ( 29.6% ) to an international scale ( 27.9% ) MEASUREMENT 58.0% currently measure their impact; 28.3% plan to do so BENEFICIARIES Broad range of beneficiaries, most commonly children ( 33.3% ), women/girls ( 27.2% ) or individuals with mental illnesses ( 27.1% ) If benefiting specific individuals, 79.4% produce goods/services for their consumption & 66.4% involve them in production processes/services ACTIVITIES 43.6% develop & diffuse knowledge about innovations 36.1% seek to influence policy-making

10. 61.0% currently sell to conventional firms (SMES and large enterprises); 18.7% hope to do so. B2B sales main income source for 35.4% of ESEM SEs, B2C sales ( 42.6% ) 24.5% of those making B2B sales today currently sell to MNCs Half (50%) currently making B2B sales, or planning to, want (additional) corporate clients Main income source for 29.3% of ESEM SEs, yet disadvantages regarding public procurement ranked as the 4 th most severe barrier SUPPLY CHAINS B2B SALES CORPORATE CUSTOMERS B2G SALES Average importance of social responsibility: 74.9% Average importance of environmental responsibility: 75.6% Access to Markets: Social Procurement & ESEM SEs

11. Access to Skills: People & Governance in ESEM SEs STAFFING 94.5% are SMEs (<250 employees) 57.6% expect to hire additional staff in the next year 55.1% employ volunteers PARTICIPATION 68.3% involve staff in decision-making to a (very) high extent 33.0% involve beneficiaries in decision-making to a (very) high extent INCLUSIVITY At least 37.2% employ persons with disabilities At least 59.2% employ people of varying ethnic backgrounds GENDER EQUALITY On average, the workforce of ESEM SEs averages 61.2% women On a verage, women in management team (55.8%), founders (52.1%), boards (50.4%)

12. Access to Finance: Financial Features & Needs of ESEM SEs INCOME SOURCES 60.4% trading income . 39.6% non-trading income (Portugal : 59.3%), on average 67.1% have hybrid income Most common: B2C sales ( 42.6% ), government grants ( 38.0% ), B2B sales ( 35.4% ) REVENUE LEVELS 32.1% had revenues < €50,000, 14.3% > €1 million & 4.9% > €5 million 44.0% experienced revenue growth in the past year PROFITS 28.9% were profitable & 24.6% broke even in the past year 86.0% distributed profits mainly/mostly to exclusively for organisational purposes FINANCIAL NEEDS 75.2% have safe financial planning horizons of <12 months 79.1% sought external financing in the past year, most commonly public financing ( 44.2% ), private donations ( 27.4% ) & foundation funding ( 21.3% ) Average 39.3% gap between financial needs & financing secured FINANCING APPLICATIONS Success rates for financing range from 60.8% to 83.9% EU funding is perceived as valuable, but the timeliness and complexity of applications dissuades ~50% of non-applicants

13. Barriers & Enablers for ESEM SEs BARRIER PREVALENCE Financial barriers affect 76.7% , non-financial support 72.7% , visibility 68.9% & legal frameworks 68.1 % Most common: limited awareness of SE among the general public (44.6%), a weak lobby for SE (44.0%), & a lack of options to finance the SE once started (41.0%) BARRIER GRAVITY Financial barriers are most problematic: lack of financial options once started ((very) much hinders ( 75.5% ), lack of patient capital ( 72.4% ), & lack of financial options when starting ( 71.5% ) Political barriers are also serious: lack of public support ((very) much hinders 70.4% ), lack of supportive fiscal frameworks ( 68.8% ) & too complex public financing ( 67.1% ) POLITICAL SUPPORT Average ranking of national political support for SE: 33.0% / 100% Only 2.0% perceive there to be a very high support for SE in their countries ECOSYSTEMS Most common support organisations: national networks for SE ( 31.1% ), incubators ( 9.0% ) & accelerators ( 7.9% ) 36.7% do not belong to any support organisations

14. Political Support Portugal vs Europe 42.4% 11 .1%

15. Political Support Portugal

16. Euclid Network European Social Enterprise Network and umbrella organization for social enterprises and impact driven leaders for 15+ years Members frontrunners in social enterprise: support organisations, national networks and alliances,  universities, incubators, social funds Fast-growing network with members in 20+ countries and active in 45+ countries (Strategic) partner to cities, regions, European Commission, United Nations, SEWF, corporates Representing over 100.000 Civil Society and Social Enterprise organisations Capacity building programs for social enterprise support organisations in Europe, Russia, the Middle East and North Africa Buy Social Business 2 Business Socially Responsible Public Procurement

17. E sLider

18. Q & A

19. @EuclidNetwork @Euclid.Network linkedin.com/company/ euclid-network wieteke.dupain @euclidnetwork.eu Follow Us on Social Media Website Contact Me www.euclidnetwork.eu

20. Data is used. Social enterprise voices are heard. Influencing decision-making. Generating visibility

21. Ideas on Next Steps Launch new survey Fall 2023! Expand the number of countries, social enterprises, partners participating Inform more policies, reports, decisions, initiatives Enter more firmly into educational materials and research at leading business schools and research institutes globally. Sharing the data (while keeping privacy protected) with more researchers… Online interactive dashboards Activate community panel Matchmake social enterprises who indicated they want to be matched based on their data with opportunities Complementing Eurostat and NSI, government statistical data, census data to inform the transition to the new social economy, twin green and digital transition… at European level and national levels In-depth reports on specific themes e.g. impact management and measurement, Buy Social Explore new partnership with partners currently only in one country e.g. World Bank Bring together in-person the ESEM consortium in 2023, to work on these plans and others