The CIC is on a steep learning curve and we have the chance to get a model that can lead the debate in the developing social economy that is taking shape here and abroad
CICs are five years old and still gowing, but people are still scared to use the P word, says CIC Regulator Sara Burgess
I’d never heard of Dan Palotta but when he talked about 'freeing the non profits' in his keynote speech at the Social Enterprise World Forum earlier this year I wanted to jump up and down cheering.
I have never understood what is wrong with an organisation being profitable when its objectives had social and ethical purposes, and that includes charities which is where most of my career has been spent.
Which is why I am so pleased that as they reach their fifth year and with nearly 4,000 on the Register, CICs are really beginning to make their mark as a business model.
It’s ok for CICs to talk about profit because the more they make the more they can offer their community of interest, without compromising their social mission which is legally protected. Sadly some people are still scared of using the P word even when its used for the greater good ,so there is still work to do.
But there is a lot of enthusiasm for the CIC model and it is being noticed around the world. I freely admit to getting a bit carried away with my enthusiasm for this family of companies and so any mention of them sets me off.
I was delighted to hear that they are being used to test what may work for social enterprise in different cultural and national contexts. It is clear our model will not suit everybody but then it was never intended to, one size definitely does not fit all as far as CICs are concerned.
What it does is offer a platform to work from and I spoke to many inspiring people at the world forum who are doing this right now. In the States and in Canada they have gone a different route based upon their own company laws but not without looking at the CIC as part of their learning and I want to see us do the same whenever new models are set up.
The CIC is on a steep learning curve and we have the chance to get a model that can lead the debate in the developing social economy that is taking shape here and abroad. We have already identified the need for some changes for CICs in the last year and who knows what opportunities future reviews will reveal.
Sharing this journey with us are the United States, Canada, Australia, South Africa, Israel, Japan, China, Korea, France and Eastern Europe, there has never been a more exciting time to be part of the social enterprise movement.
There is lots of debate and discussion around regulation at the moment, some good, some bad and some indifferent but I was intrigued to hear the Forum talk about Regulation being a competitive advantage, a badge we should wear with pride. Of course as the Regulator for Community Interest Companies I already knew this, but for others to say this as well…
CICs willingly (nobody is forced to be a CIC) make a legal commitment to the way they operate and to leave themselves open to public scrutiny and regulation. In demonstrating social purpose and transparency of operation this is a pretty powerful statement and I want to see greater recognition of this in the coming years.
Am I looking through rose tinted glasses here? I hope not. Yes, they might be pinkish but that just cuts the glare and helps me to be clear about the exciting ways CICs are currently positioning themselves in the sector. These are socially driven companies, generating profits for community , and are willing to take on regulation in order to demonstrate their commitment.
Which brings me back to Dan Palotta and his views on profit making. I went straight out and bought his book and it accompanies me on my travels, reminding me that there is a world of views out there about social enterprise which we have to be receptive to if only to remind us that change today can become the norm tomorrow.
The World Forum for me was a great opportunity to learn about social enterprise in its wider context and to refocus my thoughts on how we do it in the UK.
It gave me a fresh perspective and made me more determined to ensure that CICs remain at the forefront of the movement in the UK. When a speaker asked who knew about social enterprise there were a lot of hands put up. When he asked who knew about CICs there were a few. When he asked for those who regulate CICs, there was one, but I was amongst friends.
The CIC is five years old and growing up. It was born into an environment that was receptive to its charms and as the world is changing around us those charms are looking to be increasingly attractive to a wider audience.
We all change as we grow older and the CIC has some way to go but they are here and they are not going to be ignored as a creature of substance in the UK and beyond our borders.
Happy Birthday CIC
...as Susan Boyle might have sung. On SocialEnterpriselive.com this week:
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Comments
People-Centered Economic Development
I could have saved Sarah the expense of buying Dan Pallota's book because the case he makes for deploying capitalism as a replacement for the nonprofit model has been published on line since 1997:
http://www.p-ced.com/1/about/history/
In 2004 it was introduced to the UK in the form of a Guarantee company and in this interview later that year, founder Terry Hallman describes the proof of concept initiative which introduced microfinance to Russia.
http://www.iccrimea.org/scholarly/economicdev.html
There lies the biggest obstacle to social enterprise, the inclination to want to paint others out of the picture and that's just happened to Clare Dove now being an outsider to Big Society in Liverpool.
There's a paragraph in the P-CED paper which describes how accepting the disposal of others establishes the principle of being disposable oneself:
"Maybe we come to an agreement that it shouldn't be either you or me, or our families and friends, that can be disposed of, but perhaps someone else. While we are debating this -- passionately and sincerely, no doubt -- a third party comes along and without warning disposes of the both of us, or our families, or our friends. And there is the trap we have fallen into, because whether or not we approve of our or our families' and friends' demise is irrelevant. It is fair because we accepted the principle of human disposability."
A different context of course. Nevertheless when social enterprise becomes a matter of building reputations and organisations on the work of others and in doing so, painting them out of the picture, it cannot be seen in any way as being ethical business.
Jeff Mowatt
People-Centered Economic Development
p-ced.com
people-centered.net
Five years of CICs
CICs have indeed come far in 5 years in terms of their numbers, but lets remember that they've not been without their controversies - some sector lenders who couldn't lend to CICs owing to the original cap on interest payable on loans, the S&M CIC that almost was, and the CIC that was sold to a private company for several millions of pounds...
It's been a big learning curve for all concerned with CICs (including the various regulators), and I hope that we don't loose the important lessons from some of these perhaps less 'encouraging' stories.