Valerie Hussey, CSI's Director of Social Enterprise, comments on Social Enterprise (aka the third sector) in Canada and the UK:
It is interesting to read that the regulator of Community Interest Companies (CIC) in the UK has lifted the amounts that can be distributed to investors, recognizing that the one percent differential between debt and equity finance “…may not give adequate incentive to investors to make an equity investment … .” Meanwhile, in Canada, we continue to wait for someone – anyone – with the ability to do so, to take a bold action that will help the Canadian third sector to catch up.
CIC regulator Sara Burgess said she would review the changes in two or three years to find out how effective they are. Do we have a chance of seeing any initiative in two or three years? And if we do, how is it going to impact the grassroots of social enterprise?
We know there is work being done and policies proposed at the higher level of social enterprise development. This appeals to government because it’s thought that it will move the needle faster. Yet the bread and butter of our economy is small business, and it will be small social enterprises that will fortify the work of the sector. Like small business, small social enterprises need access to capital, patient capital and patient investors, who understand the long-term value of their investment.
We need regulators who are committed to creating policies that can work. A strengthened third sector, with flourishing social enterprise, especially at the grassroots, will contribute exponentially to the overall health of Canadian society and its economy. This is not fringe economics. It’s putting to work every aspect of our charitable, and not-for-profit community, and setting the stage for the profit sector to participate in social enterprise.
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