Dame Mary Marsh: The social sector should be defined and recognised in charity law

Sharing evidence of successful social enterprise is key, says our columnist

Dame Mary Marsh
Dame Mary Marsh

It was very refreshing to share in the lively celebration that marked the end of the initiative that appointed and supported the social enterprise ambassadors.

There was a powerful sense of can-do energy in the room, as well as some remarkable stories of lives and communities transformed. These included many different examples of effective leadership that were simply inspirational.

One way and another, the promotion of the potential for social change organisations to earn sustainable revenue streams has been increasingly successful. We should all get better at 'show and tell', as Cliff Prior, the chief executive of UnLtd, said to me recently.

Evidence about what works is key, and seeing such evidence can have a powerful effect. We need to share our experience of journeys to success as well as using the harder-edged performance measures such as social return on investment.

In the same week, the first social impact bond was launched, with the promise of many more to come.

The principle is finally being recognised that the right initial investment might reduce the cost overall. Social outcomes do not often come in neat packages that fit into financial years.

It is hard to find a satisfactory way of describing all the organisations that can fit in what I like to call the social sector. Charities, social enterprises and community organisations all make different but often overlapping contributions. Internationally, the term NGO is well understood, as is non-profit, but they are rather negative terms about what we are not rather what we are.

When I first studied at business school, I said we were actually 'not for loss'. Profit is fine. What matters is what you do with it.

One frustration that many of us share in this sector is the lack of a legal or regulatory definition of social enterprise. Such organisations are diverse and cross the space between wholly charitable organisations and entrepreneurial businesses.

We waited about 400 years to reform charity law, but it still does not recognise a place for social enterprise or social finance provided by an individual.

The insistence on having a boundary between public and private benefit continues to challenge us. Surely there must be contexts in which they exist together.

The review of the Charities Act that is due next year needs to address this. And, in my view, we are all 'organisations for social good', which is just what the big society needs.

Dame Mary Marsh is director of the Clore Social Leadership Programme

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