Leveraging social innovation for a more resilient EU economy
In its response to the European Commission’s consultation on the EU’s Social Economy Action Plan, CEC European Managers highlights the importance of mainstreaming sustainable business model innovation, including innovation on social impact, across economic sectors. In line with the EU Green Deal and Social Pillar, much more needs to be done to ensure the uptake of Sustainable Leadership and positive corporate impact, beyond a siloed “social economy” approach only. The crisis has shown that business that fail to deliver on solving economic, social or environmental challenges are not resilient, particularly vulnerable to external shocks and too often dependent on, sometimes illegitimate, public aid.
In its function as European social partner, CEC European Managers has replied to the European Commission’s consultation on a new Social Economy Action Plan. The initiative was launched as part of the European Pillar of Social Rights, aimed at strengthening the EU’s social dimension. Today, it is estimated that the social economy in Europe represents 2.8 million entities and enterprises as well as over 13.6 million paid jobs, i.e. 6.3% of the working population1. The sector addresses important societal challenges on a larger scale while inspiring systemic changes in the mainstream economy.
However, many social economy organisations today face several challenges, including access to finance, research and innovation capacity and lacking recognition. Therefore, more favourable fiscal and legal rules, as well as support programmes are needed to help these companies. To professionalise these organisations, CEC also highlights the role of professional management. Specific support policies (including via fiscal measures) sould be developed to help social economy actors have access to high-level HR and managerial resources.
Beyond improving the framework conditions for social economy organisations, much more needs to happen to ensure companies can transition to different ways of creating value. Sustainable value creation for the EU economy can be encouraged through the harmonization of fiscal rules, legal conditions and rules on capital access favouring companies performing well on sustainability (Triple Bottom Line), according to sound and context-based sustainability indicators. The EU taxonomy could be a good starting point, if enriched by the social dimension.
Finally, the concrete design of the Action Plan, including through a better understanding of challenges on the ground, should be realized with the involvement of social economy organisations, social partners and other relevant stakeholders at the respective level of action.
More Information
1 “The recent Evolutions of the Social Economy in the European Union”, European Economic and Social
Committee report, 2017: http://www.ciriec.uliege.be/en/publications/etudesrapports/recent-evolutionsof-social-economy-study/
