Country report on social economy

5. Social Economy: what is understood by Social Economy in your country? Who

does social economy? Describe those organizations which are involved in social
economy.

Social economy is a highly debated topic in the European Union countries lately, and
one reason for this would be its link to matters like unemployment, regional
development, welfare etc. Nevertheless defining ​social economy​ could be difficult as
many politicians might disagree about it, even if they use the term frequently in their
policies.

It could be defined1 shortly as the economy with some social impact. Or more precisely,
it is the complex of autonomous private activities realized by different types of
organizations that have the aim to serve their members or local community first of all by
doing business.

The social economy is oriented on solving issues of unemployment, social coherence

and local development. It is created and developed on the base of concept of triple
bottom line – economic, social and environmental benefits. Social economy enables
citizens to get involved actively in the regional development. Making profit/surplus is
desirable, however is not a primary goal. Contingent profit is used in preference for
development of activities of organization and for the needs of local community.

Subjects of the social economy are social enterprises and organizations supporting their

1
​http://wikipreneurship.eu/index.php5?title=Social_economy_in_the_Czech_Republic
work in the areas of education, consulting and financing.

The term social enterprise stands for ​socio-economic entities​ that pursue social
objectives by means of productive activities carried out in a stable and continuous way.
Social enterprises relay on a broad range of resources (voluntary work, donors, public
contributors - by EMES research definition). We can understand it through citizens’
initiatives, and governmental participation, producing and delivering welfare on the
non-governmental level. The most significant role of a social enterprise is to prevent the
poverty of people endangered by social exclusion, and force the social cohesion. It is (a
small) business controlled according to democratic principles by co-operative members,
and its non-risk and variable capital is employed by work, and it naturally produces
socially positive externalities. Such co-ops are the vehicle in a civil direct democracy.

In the Czech Republic the social economy has a long tradition mainly in the countryside.
The Czech cultural and economic identity in the territory of the Hapsburg empire was
founded on voluntary activities by civil society and was formed by the activity of small
and medium-sized enterprises, production and consumer cooperatives, clubs, mutual or
municipal savings banks and cooperative agricultural banks. It is fair to say that the role
of these cooperatives and companies intensified during the 1920s and 30s, when the
Great Depression spread across the world. During the totalitarian era they suffered form
the lack of certain important features of social-economy entities, such as independent
economic decision-making and autonomy from the state.

There are currently around 50 social enterprises in the Czech Republic doing business
in just about every area of the economy (production and services of all kinds). These
include cleaning services, cafés, confectionary shops, restaurants, production and
processing firms, graphic studios, digitisation studios, call centres, park and garden
maintenance firms etc.
At ​www.socialni-ekonomika.cz​ ​is compiled an up-to-date catalogue of all the social
enterprises in the Czech Republic, including their fields of activity, which is available at.
In general terms, the space for social entrepreneurship in the Czech Republic (and
elsewhere) lies in small-scale supplementary services and production that do not
compete with the global market; quite the contrary in fact, they tend to have a very
local/regional dimension and satisfy local needs using local resources.

References:

Hunčová, M. (2003): The Czech co-operative reality and its social aspects (From Co-operative
to Social Enterprise), Trento 19-20th December 2003.
http://www.neziskovky.cz/clanek/1662/0/home/english/
Daniela Bednáriková & Petra Francová (2011): Study of the Infrastructure of the Social
Economy in the Czech Republic, Nová ekonomika, o.p.s.