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ACEVO and Social Enterprise UK have challenged the central tenets of David Cameron's speech on moral capitalism given this morning.
Speaking to David Cameron following his speech on moral capitalism, Sir Stephen Bubb CEO of ACEVO, the body for charity leaders, called for Government to let bankers keep their bonuses but instead encourage them to give the money to charity or to invest more in social enterprise.
In his question to the Prime Minister Sir Stephen Bubb said: “I think we need to move forward from the age old rather patronising view of the third sector as the poor relative which just takes. There is a lot that business leaders in the UK could learn from the leaders of our great charities and social enterprises in this country.
“The best way to learn about moral capitalism would be to appoint more of those third sector leaders on to the boards of our big businesses, and to encourage bankers to give their bonuses to charities or to invest in social enterprise."
And in response to the Prime Minister’s speech, Social Enterprise UK chief executive Peter Holbrook, said: “Politicians are behind the people when it comes to responsible business and they need to catch up. Moral markets are already rising and consumers are driving this trend, choosing to buy from social enterprises.
“The last two years have seen a start-up explosion in social enterprise and it’s happening in Britain’s most deprived communities. Social enterprises are trading and reinvesting their profits into the communities where they work – not funnelling them off to wealthy shareholders elsewhere.
“Reforming capitalism is a hot political topic, but no-one should hope public anger will be appeased with token gestures. We need real action and strong policies that are going to address the inequality that has been allowed to grow in the UK. Real people are suffering.
“Despite the fact that social enterprises are simultaneously tackling social issues, creating jobs and powering up local economies, they are often stifled because they’re not entitled to the tax breaks available to other start-up businesses and are left out of business support programmes. There’s no doubt that with more support from our policy-makers the social enterprise sector could bring about a responsible recovery.”
Social Enterprise UK says the Government needs to:
Extend investment tax-relief in start-up businesses to social enterprises
Prevent the leakage of public money to private businesses and investors by:
Reversing the trend to privatise public services prioritising instead social enterprise models that lock-in and multiply wealth and are accountable to their communities and staff.
Making time for the Public Services Bill which has cross-party support and will ensure public spending decisions take account of the social, economic and environmental value they create.
Change corporate governance to incentivise better ownership structures and the significant involvement of stakeholders including staff and customers.
Incentivise the creation of social enterprises and social ventures through promotion, tax incentives and support.
Findings from Fightback Britain: State of Social Enterprise Survey 2011 show that across Britain one in seven of all social enterprises is a start-up, more than three times the proportion of start-ups in mainstream small businesses (14%, compared to 4%).
Some of the biggest social enterprises operating in the UK today are those that started in the recession of the 80s.
The research shows that 58% of social enterprises grew last year compared to 28% of Small and Medium-sized Enterprises (SMEs).
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