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![Page 1: Mission Alignment Working Group Profit-with-Purpose Businesses Working Group Chair: Cliff Priorcliffprior@unltd.org.uk @unltd.org.uk.](https://reader034.fdocuments.net/reader034/viewer/2022051820/56649e3f5503460f94b2fdcf/html5/thumbnails/1.jpg)
Mission Alignment Working Group
Profit-with-Purpose Businesses
Working Group Chair: Cliff Prior [email protected] www.unltd.org.uk B Lab UK: James Perry [email protected]
www.bcorporation.uk1
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The most relevant Taskforce recommendations
7. Give profit-with-purpose businesses the ability to lock-in mission: governments to provide appropriate legal forms or provisions for entrepreneurs & investors who wish to secure social mission into future
Taskforce recommendations as Market Steward:•Create legal forms or regulations that protect the social mission of impact-driven organisations•Relax regulations that prevent social sector organisations from generating revenues
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• Many social start ups, but so few achieve scale• Critical bottlenecks at the early growth stages• High risk: equity investment is relevant• Asset/profit locked social ventures eg non-profits and
social enterprises cannot easily take equity investment• There is a huge wave of entrepreneurs who want to go
social: eg 1 in 5 of all aspiring to startup in the UK• Early stage “angel” investors are prepared to invest in
social ventures if they can see a realistic return• Solution: a model for social ventures which
distribute profit and lock in social mission in other ways: profit with purpose business
What’s the problem to solve?What’s the opportunity to tap?
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Characteristics that define a profit-with-purpose business
A Profit-with-Purpose Business is one that seeks, commits to, creates and shows social impact
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• Using the momentum: building confidence in the idea of profit-with-purpose business
• Standardising legals: model Articles for profit-with-purpose companies limited by shares
• Improved regulation and tax: Community Interest Company rules relaxed; new Social Investment Tax Relief
• Reporting: B Lab UK launching September• UK exemplars: UnLtd’s Big Venture
Challenge has supported PWP business • Case studies: success stories to achieve
confidence of all stakeholders
Activities in the UK
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Telefonica’s Wayra UnLtd tech accelerator for social impact has outperformed all 12 of their commercial accelerators in terms of investment, mainly through profit with purpose business candidates.
Oomph! Wellness: 498 care staff trained 16,100 classes delivered 278,200 attendances98% of staff recommend Significant or very significant impact on:- physical mobility 59%- social interaction 81% - mental stimulation 71%Quality of life up 10% A profit with purpose business for improving lives of older people£300k equity investment
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• Canada, France, Italy, Japan: legislative changes under underway, allowing for social & enterprise combinations
• USA: continuing growth in number of States allowing Benefit Corporations
• Germany: growing interest, Award for exemplar, NAB• EU: EUSEF standard for social investment funds,
GECES work on social impact reporting• B Corp expansion: into Europe, Australia, Canada, Africa• Informing the lawyers: published legal analysis of 8
countries by Orrick; outreach to lawyers through Thomson Reuters Foundation, raising awareness
• Beyond G7: UnLtd provided materials and support to the 52 countries with GSEN members.
• Examples of progress in Australia, Taiwan, Thailand, Colombia, Chile …
Other country activities
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• Cultural challenges: “profit and purpose don’t mix”• Vested interest challenges: “we don’t need this”• Sceptical challenges: “it won’t work” “there will be
mission drift” “it just slows down the entrepreneurs”• Awareness challenges: it has taken decades for social
enterprise to be recognised even in pioneer countries
• Connect to population level interest: start from where the entrepreneurs and investors are, engage those already doing it, build a movement
• Demonstrate the reality: focus on real enterprises, real impact, showcase their work, don’t focus on the plumbing
• Create the permissions: legal permission, accreditation
The Challenges and Solutions
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G8 Social Impact Investment Taskforce
The UK context: Where’s the social business frontier?
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What is a B Corporation?
Regular BusinessNo Asset LockNo Social MissionNo Social Performance Test
Social Sector OrganisationsAsset LockSocial Mission LockNo Social Performance Test
Before
global movement of people using business as a force for good
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What is a B Corporation?
Regular BusinessNo Asset LockNo Social MissionNo Social Performance Test
Social Sector OrganisationsAsset LockSocial Mission LockNo Social Performance Test
Before
Regular BusinessNo Asset LockNo Social MissionNo Social Performance Test
B CorporationsNo Asset LockSocial Mission LockSocial Performance Test
Social Sector OrganisationsAsset LockSocial Mission LockNo Social Performance Test
After
global movement of people using business as a force for good
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What is a B Corporation?
Regular BusinessNo Asset LockNo Social MissionNo Social Performance Test
Social Sector OrganisationsAsset LockSocial Mission LockNo Social Performance Test
Before
Regular BusinessNo Asset LockNo Social MissionNo Social Performance Test
B CorporationsNo Asset LockSocial Mission LockSocial Performance Test
Social Sector OrganisationsAsset LockSocial Mission LockNo Social Performance Test
After
global movement of people using business as a force for good
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B Corporations are a global movement
1,307 B Corporations 121 Industries 41 Countries 1 Unifying Goal
425 B Corps (35%)
outside the U.S.
In 2014, more new
B Corps outside the U.S. than
inside
global movement of people using business as a force for good
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2012 2013 2014 2014 2015
This global movement is growing
global movement of people using business as a force for good
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• The UK has a long and distinguished history of social businesses
• Target launch September 2015 with over 50 companies
B Corporations will launch in the UK in Sept 2015
• Effort led by experienced entrepreneurs who lead UK B Corporations
• More demand from business to change than capacity to respond to this desire
global movement of people using business as a force for good
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• Launch inspired by the work of the G8 Social Impact Investment Taskforce
• Also working with the UK National Advisory Board to pilot a new variant, with a guardian shareholder to lock-in mission
• Based on the concept of a Golden Share
The UK will launch B Corps and pilot a ‘Mission Locked’ B Corp
global movement of people using business as a force for good
For Illustration
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Building a new sector of the economy
1,307 B Corporations 121 Industries 41 Countries 1 Unifying Goal
global movement of people using business as a force for good