South Yorkshire Funding Advice Bureau Information Sheets Socialenterprise Last updated April 2008 SYFAB cannot give detailed advice on setting up or running social enterprises but there are other local agencies which are equipped to do this in depth (see contacts section). However, where Social Enterprises are run for a clear community purpose, by a voluntary management committee and with a governing document that clearly outlines your social aims, SYFAB may be able to give advice and provide a Funding Search. Social Enterprises are not-for-profit businesses with a social purpose, which re-invest their surpluses back into the business or into their local community. Some social enterprises are set up as social businesses, some are registered charities (although there are regulatory constraints) and some are trading arms of registered charities. Existing charities and voluntary and community groups can engage in social enterprise activities within their existing structure as long as the enterprise activity fits with their primary purpose. There is no one model for social enterprises and they can have a variety of different legal structures. Legal Structures Many social enterprises will operate as incorporated associations, either as companies or as Industrial and Provident Societies (IPSs): Companies There are two different types of company: a company limited by guarantee (whereby the personal liability of guarantors is limited to a nominal sum of usually £1, payable if the organisation folds) and a company limited by shares (which is not usually a suitable structure for smaller organisations). The constitution of the organisation usually states that profits are to go towards the company’s social aims and there can be an ‘asset lock’ written in, so that any assets of the company are protected and will be distributed in line with the social purposes of the company, should the company fail. These types of company structure can be stand-alone, registered charities or trading subsidiaries of registered charities. In 2005 Community Interest Companies (CICs) were introduced by the government as a new type of legal structure for social enterprises. This structure ensures that companies without charitable status can securely lock their assets for the social purpose intended and are able to demonstrate a clear community purpose. Charities cannot be CICs but can operate them as trading subsidiaries. Charitable Incorporated Organisation is a new legal structure which will be brought in during 2008. This is a new legal form of incorporation which means that charities that are also companies will only have to register with the Charity Commission and will have simpler accounts, returns and other procedures. Industrial and Provident Societies IPSs can be Bona Fide Co-operative Societies, which exist for the benefit of their own members, or Community Benefit Societies, which need to have a wider community benefit. Both have limited liability for members in event of the society failing. There are currently moves towards legislation for Community Benefit Societies to also protect their assets through an asset lock. Anyone thinking of setting up a social enterprise needs to take specialist advice on the legal form that would be best suited to their business (See contacts below). As part of promoting sustainability, the government and some of the major funders are interested in funding social enterprises, either as the sole activity of an organisation or as an income generating arm of charities and community groups. Funding support can be in the form of grants or loans. Funding from charitable trusts may be limited however, for social enterprise which is not part of a registered charity. Useful Contacts The Social Enterprise Coalition Information on social enterprise. Tel: 020 7793 2323 email: info@socialenterprise.org.uk Web: http://www.socialenterprise.org.uk NCVO Sustainable Funding Project An NCVO project to help organisations develop a sustainable funding mix. Tel: 020 7520 2519 email: info@socialenterprise.org.uk Web: http://www.ncvo-sfp.org.uk Development Trusts Association To support the formation of new development trusts and to help development trusts work more effectively. Tel: 0845 458 8336 email: info@dta.org.uk Web: http://www.dta.org.uk Social Firms UK To create employment opportunities for people with disabilities through the development and support of Social Firms. Tel: 01737 764021 email: mailto:info@socialfirms.co.uk Web: http://www.socialfirms.co.uk Charity Commission Information for charities on trading, public benefit and primary purpose. Tel: 0845 3000 218 email: via website Web: http:// www.charitycommission.gov.uk Local support organisations Key Fund Yorkshire Provides funding and support and advice for social enterprises in Yorkshire. Tel: 0845 140 1400 email: info@keyfundyorks.org.uk Web: http://www.sykeyfund.org.uk Barnsley Development Agency Ltd Business advice to existing and new social enterprises Social Enterprise Barnsley Westgate Plaza One PO BOX 598 Barnsley S70 9EX Tel: 01226 787528 email: investment@barnsley.gov.uk Web: http:// www.barnsleydevelopmentagency.co.uk Doncaster Community and Social Enterprise Partnership A focal point for anyone interested in social enterprise to share news, information and good practice. Doncaster CVS Units 5 & 6 Trafford Court Doncaster DN1 1PN Tel: 01302 343300 ext. 240 email: admin@doncastercsep.org.uk Web: http://www.doncastercsep.org.uk Doncaster Social Enterprise Development Team Business support for would-be and established social enterprises. Doncaster CVS Units 5 & 6 Trafford Court Doncaster DN1 1PN Tel: 01302 343300 ext. 239 email: enquiries@doncastercvs.org.uk http://www.doncastercvs.org.uk Doncaster CSEP CIC Procurement and commissioning support for social enterprises. 23 South Parade Doncaster DN1 2DJ Tel. 01302 364414 email: mailto:enquiries@doncastercsep.org.uk Web: http://www.doncastercsep.org.uk/ cic/cicindex.htm Conisbrough and Denaby Development Trust (CDDT) Training courses in setting up businesses and social enterprises. Some courses open to individuals in Conisborough and Denaby area, some have Doncaster or South Yorkshire-wide eligibility. The Terrace Castle Avenue Conisbrough Doncaster DN12 3BT Tel: 01709 866466 email: info@cddt.co.uk Web: http://www.cddt.co.uk/theterrace Sheffield Community Enterprise Development Unit (SCEDU) Support for groups in Sheffield who are setting up or are established as community enterprises. 53 Mowbray Street Sheffield S3 8EN Tel: 0114 201 5260 email: via website Web: http://www.scedu.org.uk Business Link Yorkshire Advice on starting up and developing business ideas and new businesses. Tel: 0845 604 8048 email: info@businesslinkyorkshire.co.uk Web: http://www.businesslink.gov.uk South Yorkshire Investment Fund Business support to new and developing businesses. Reresby House Bow Bridge Close Rotherham South Yorkshire S60 1BY Tel: 01709 386377 email: info@syif.com Web: http://www.syif.com © SYFAB 2008 All rights reserved. Our information is produced for local community and voluntary groups. No permission is needed for limited reproduction if the Bureau is acknowledged. Large scale reproduction or inclusion in publications for sale must have written permission from the Bureau. The South Yorkshire Funding Advice Bureau welcomes your comments and criticism. You can talk to any member of staff, or contact us by post, phone, fax or email - see the front page for details. All our information is produced in a standard sized typeface, but we can produce it in other formats on request South Yorkshire Funding Advice Bureau The Workstation 15 Paternoster Row Sheffield S1 2BX Tel: 0114 249 4343 email: enquiries@syfab.org.uk Website: www.syfab.org.uk Funding Advice Line 0114 276 5460 Registered Charity No: 1061118 Reg. Company No: 3030641