Profit with Purpose

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Comment by Jo Painter 5 hours ago

Hi all,

Really interesting free lecture in Oxford next week, if anyone is interested...

‘An Entrepreneurial Journey: Thriving on the Unexpected’

Jessica Jackley, Cofounder of Kiva will be talking about her entrepreneurial journey on 30^th May, at the Said Business School in Oxford:

http://pearsbusinessschoolslecture2013.eventbrite.com/#

Comment by Jeff Mowatt on February 12, 2013 at 11:41

The Power of Outrospection a recent RSA Animate production gives opportunity to illustrated that social business is about far more than social media.  

Comment by Jeff Mowatt on February 8, 2013 at 16:23

It is the RSA's Matthew Taylor who today draws attention to the difference between core business activity an... in the Guardian. At the same time in the Telegraph, Stephen Howard takes to the rostrum for capitalism being a force for good.   .

Comment by David Floyd on February 7, 2013 at 12:09

Hi Maria,

In terms of charities and tax, it doesn't make any difference to the taxes an organisation and its staff pay as employers/employees.

Corporation tax on profits/surplus is potentially an issue but I was mainly making the point in terms of gift aid, which is a factor to consider if your organisation is hoping to generate a significant chunk of income through donations.

Info here: http://www.hmrc.gov.uk/individuals/giving/gift-aid.htm

In terms of your final decision, I wouldn't reccommend setting up two organisations to begin with unless they're actually going to operate as separate organisations involving different people.

There's nothing to stop you - at any point - setting up a sister-organisation if it turns out that you do have different strands of your work that are operationally separate but until that's clear, there's a danger of creating extra adminstrative work without getting much practical benefit.

Comment by Pascale Scheurer on February 7, 2013 at 11:19

Is anyone else coming to the "CSR 3.0" talk with Prof Grayson today at RSA, 1pm? If so, see you there, do come up and say hello.

Comment by Maria Ana Neves on February 7, 2013 at 11:08

Excellent points, thanks Christopher and Jonathan and Jeff. 

We are just trying to make an executive decision on how to incorporate to help us move forward. For this is really about the legal+governance+ownership side of the question, rather than the philosophical/cultural dimension. 

I totally agree Jonathan's point made - as a totally "cause and values driven" team, it will only make sense to continue if we have the impact we aim for, and that needs to me assessed on actions, rather than definitions.

So: the practical views are so far

- Charity will be good for grants (much needed!) and more challenging for governance 

- Social Enterprise (C.I.C) - more freedom in governance, better control in what we want to do, business-like mindset, but not so good for funding (still some opportunities, correct?)

- Other recommendations we have received: 

- to consider a co-op model (sounds exciting, is it a good strategy for the early stage?)

The tax issue, touched by David:

- Personally I am 100% pro-tax - based on the principle we are able to generate revenues, why would we not want to pay taxes?

The real vision of what success looks like is that we are capable of helping food businesses to give surplus food to charities, help the charities to make the best of this resource and help more people improve their lives, sustain our team and mission by creating jobs that are well paid, and... pay taxes without suffocating the ability to grow... 

so: would we need to consider a Charity arm that studies/learns/research and a C.I.C which delivers/trades/provides services?

Or are we getting in trouble, and should we just focus in one for now?

Comment by Jeff Mowatt on February 6, 2013 at 8:39

I wholeheartedly agree with Jonathan on the matter of demonstrating action.

My business, P-CED describes itself as 'profit for purpose'  and that stems from a statement in our founding paper which begins "Clearly, profits can be used very effectively in ways other than traditional investment and profit outcomes. Moreover, this is not charity, it is business--good business". In 2006 there was a conversation on 'profit for a purpose' on the Social Edge forum.  We'd see this become 'profit with purpose' when the original non dividend distibuting concept began to be diluted. When 'Creating Shared Value' arrived there was a shift from 'for and with' purpose toward 'profit from a purpose' when Mark Kramer declared that corporations could profit from solving social problems. I disagreed and that got me blocked from the Guardian who've gone into overdrive with talking the walk.

Interestingly I discover that my use of the term in correspondence seems to have seeded a meme and now find it being used to justify excluding us.    

Comment by Dr Jonathan M Collie on February 5, 2013 at 16:03

I feel strongly that it's more important how an organisation behaves in demonstrating its social enterprise credentials,  than how it's registered legally. Social enterprise should be measured by impact and not by words. I've come across many charities that offer thin services and who feel that their legal status entitles them to handouts to sustain themselves. I also know charities who operate in a more cutthroat manner than most big corporates. Then there are limited liability companies that genuinely do attempt to balance people, profit and planet. It's time for the term social enterprise to not just belong to charities, foundations and CICs.

Comment by CHRISTOPHER JOHN SAVORY on February 5, 2013 at 10:35

These exchanges reflect the classic blurring between charities that operate very "commercially" and business with a strong social conscience. As Maria states both make sense. I operate across the "grey zone" where many public sector bodies are forced to act more commercially and where charities are driven to adopt a more business like approach. My sense is that many more people are being driven into working in this grey zone either through choice or necessity.    

Comment by Maria Ana Neves on February 5, 2013 at 10:23

Thank you David, 

that is precisely where we get stuck: both make sense, for Plan Zheroes, which has more a social mission than a business heart, but some of us (including me...) are more entrepreneurial, and others are only motivated by the social mission.

Although we all agree that is a good idea to create jobs, and have a sustainable model to give us the infrastructure we need, we also love the energy from being less structured and a bit adventurer (chaos and strong values are at the very heart). 

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