EUROPEAN COMMISSION Brussels, 9.12.2021 SWD(2021) 373 final COMMISSION STAFF WORKING DOCUMENT Accompanying the document Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions Building an economy that works for people: an action plan for the social economy {COM(2021) 778 final}



Contents 1. Why an action plan for the social economy? 2. Social economy in Europe – An overview 2.1 Organisation types 2.2 Mapping the social economy: different starting points, scope and dynamics 2.3 Efforts in measuring social impact 2.4 Gender dimension 3. Collection of evidence and consultations 3.1 Evidence and data collection 3.2 Consultations 3.3 Publication of the SEAP roadmap 4. Challenges and opportunities for the social economy – Main findings from the consultations 4.1 On the action plan for the social economy in general 4.2 Defining social economy at the European level 4.3 Enhancing awareness and visibility of the social economy 4.4 Support for specific target groups 4.5 Developing policy and legal frameworks 4.6 Social economy and State aid

4.7 Taxation 4.8 Better access to markets: socially responsible public procurement 4.9 Promoting the social economy at regional and local levels 4.10 Promoting the social economy at international level 4.11 Improving access to funding 4.12 Boosting social innovation 4.13 Fostering digitalisation and new technologies 4.14 Maximising the contribution of the social economy to the European Green Deal and circular economy 4.15 Promoting entrepreneurial skills and capacity building 4.16 Implementation of the action plan for the social economy 5. EU Budget to support social economy 2021-2027 Annex 1: recent declarations on (or related to) social economy Annex 2: List of stakeholders who submitted feedback on the social economy action plan roadmap Annex 3: Examples of existing social economy awards



1.Why an action plan for the social economy? Ten years ago, in 2011, the European Commission launched the Social Business Initiative (SBI) . This was followed by the Start-up and Scale-up initiative in 2016. Further to these initiatives the EU has launched a large number of actions to support the development of the social economy and social enterprises in view of their potential to address societal challenges and contribute to sustainable economic growth. Social economy ecosystems have developed significantly over the last decade and the concept of social economy has gained attention and momentum. Progress has been made, yet a great deal remains to be done in terms of harnessing the full potential of the social economy. Therefore, the President of the Commission Ursula von der Leyen has mandated the Commissioner for Jobs and Social Rights, Nicolas Schmit, with developing a European Action Plan for the Social Economy. The action plan contributes to the Commission priority “An economy that works for the people”. Given the transversal nature of social economy, the action plan will support the objectives of the Commission in a variety of other policy areas (European Green Deal, A Europe fit for the digital age and Promoting our European way of life).

It is complemented by a second Staff Working Document which presents scenarios towards the co-creation, together with stakeholders, of the transition pathway of the ‘Proximity and Social Economy” industrial ecosystem towards its green and digital transition and long-term resilience. 2.Social economy in Europe – An overview Member States have heterogeneous traditions and employ a variety of terminology as to which organisations are part of the social economy. Historically, the term social economy refers to four main types of organisations: cooperatives, mutual benefit societies, associations (including charities), and foundations. In recent years, social enterprises emerged as a new type of organisation in the social economy. Social enterprises operate by providing goods and services for the market in an entrepreneurial and often innovative fashion, having social and/or environmental objectives as the reason for their commercial activity. Profits are mainly reinvested with a view to achieving their societal objective. Their method of organisation and ownership also follow democratic or participatory principles or focus on social progress. Social enterprises adopt a variety of legal forms depending on the national context. Section 2 of the action plan provides a definition of the social economy from the EU perspective. 2.1 Organisation types The action plan provides a definition of the social economy from the European Commission’s perspective. It highlights that Member States have heterogeneous traditions and employ a variety of terms in relation to the social economy. It is commonly considered to include the following organisation types: cooperatives, mutual benefit societies, foundations, associations and social enterprises. Cooperatives have a long history in Europe and globally. There are some 131,000 in the EU active in all sectors of the economy. They are people-centred enterprises jointly owned and democratically controlled by and for their members to achieve common social and economic objectives. Driven by the principles of fairness and equality, they usually generate long-term jobs and prosperity. They are managed by producers, users or workers and are run according to the 'one member, one vote' rule. They offer innovative solutions to green growth such as renewable energy, but also to societal challenges. For example, recently platform co-operatives offer a potential route to a fairer digital economy that generates quality working conditions and other tangible advantages for workers and consumers alike and helps retain revenues and taxes locally. Cooperatives also provide a solution for workers wishing to jointly buy their company. Different types of cooperatives exist: consumer cooperatives, producer cooperatives, worker cooperatives, social cooperatives, platform cooperatives (overlaps are possible). Mutual benefit societies are private entities owned and governed by their members. They play an important role in health insurance and in providing good, affordable and universally accessible health, long-term care and other social security services. They are driven by the principles of solidarity, affordability, non-discrimination and non-exclusion and are often key partners for public authorities, providing innovative social services, such as healthcare and general care services. Some 209 million citizens in Europe receive health coverage and other social security services from mutuals. They command a 25% share of the insurance market and 70% of the total number of undertakings in the industry. Public-benefit foundations are asset-based and purpose-driven. They generally have no members or shareholders and are separately constituted non-profit bodies. They can engage in many forms of philanthropy, from traditional grant-making to running their own programmes to venture philanthropy and other new forms of social investment. Public-benefit foundations focus on areas ranging from the environment, social services, health and education, to science, research, arts and culture. They tend to have an established and reliable income source, which allows them to plan and carry out long-term work. There are estimated to be approximately 147,000 public-benefit foundations in Europe. They can also act as funders of, and investors in, social enterprises and other social economy organisations. Similarly, they help leverage private funding for many other important EU policy priorities. Associations are vital for democracy and a constituent of EU civil society. As about 19% of the EU adult population engages in formal volunteering activities, associations offer a unique space where citizens engage in common interests and generate social cohesion and mutual understanding. They are present in many areas such as sport, education, environmental protection, culture or health. The possibility that associations carry out entrepreneurial activities is not acknowledged in all countries. Most social enterprises have their roots in one of the above-mentioned social economy forms. In countries where a significant degree of freedom in the performance of entrepreneurial activities by non-profit organisations is permitted, the most widespread path to setting up social enterprises remains the use of the legal form of association and/or foundation (e.g., France, Belgium, Austria, Germany and the Netherlands). However, they can also take other legal forms that have not been designed specifically for them (e.g. conventional enterprises), which makes it difficult to capture their size and contribution to the economy. A recent report showed that they employ high proportions of female workers thanks to the availability of more flexible jobs. Social enterprises are active in a wide range of fields of activity. Particularly well known are work integration social enterprises (WISE) which benefit from legal recognition in a significant number of countries. For example, countries such as Austria, Bulgaria, Croatia, Germany, Poland, Romania, Slovenia and Spain have introduced statuses recognising WISEs to facilitate especially the integration of disabled people. Over the years, there has been a progressive enlargement of the typologies of disadvantaged people to be integrated by those legal forms that obtain the WISE status, whereas in the past only people with disabilities could be integrated. 2.2 Mapping the social economy: different starting points, scope and dynamics The landscape for social economy ecosystems in EU Member States is diverse. Data on social economy in the EU is partial, because social economy organisations fall under several categories in national accounts and therefore the volume of their activities is not directly visible in this most reliable data source. The most accurate estimation of the economic importance of social economy in Europe is included in the study “Recent evolutions of the social economy in the EU” (EESC 2017). Satellite accounts are the most solid way to get a clear, comparable and harmonised view of the social economy in a way compatible with the overall national accounts framework. However, only two Member States (Belgium and Portugal) have set up national versions of satellite accounts. Four more Member States worked on satellite accounts under a grant from Eurostat. The EESC study finds that the social economy represents around 2.8 million organisations and entities in Europe, as well as over 13.6 million paid jobs (i.e. 6.3% of the work force). Social economy represents between 0.6% and 9.9% of all jobs across Member States. In the countries where it is most developed it makes an important contribution to GDP. These different degrees of development demonstrate that it has significant untapped economic potential, including in terms of job creation, in many Member States.

Specific data on the number of social enterprises in the EU is limited, given that this concept is based on the characteristics of the undertaking rather than on its legal form. The recently published synthesis report of the 2020 mapping of social enterprises provides the latest estimates. However, given the low availability and reliability of data is some countries, it only draws together and presents the national data to enable comparisons when possible. For example: -The highest numbers of social enterprises are found in: Italy (102 500), France (96 600), Germany (77 500), and Poland (24 500). -The highest numbers of social enterprises per 1 million inhabitants are found in: Italy (1690), Hungary (1620), Luxembourg (1550), Belgium (1530) and France (1400). The mapping study was launched by the European Commission as a follow-up to its 2011 communication on the Social Business Initiative (SBI) in order to shed light on the current size, scope and state of social enterprises and their ecosystems in Europe. The first study was published in 2014 and mapped social enterprise activity and ecosystems in 29 countries using a common definition and approach. Following this initial effort, an update was launched in seven selected countries in 2016. A complete update of the then 28 Member States plus seven neighbouring countries participating in the Employment and Social Innovation (EaSI) Programme was carried out in 2018-2020. The mapping study identified different drivers that have been boosting social enterprise development in recent years depending on the type of welfare system in place: Table: Drivers and trends of social enterprises The degree of recognition of the social economy and social enterprises varies largely from one Member State to another. However, the general trend is clearly positive: since the Commission adopted its Social Business Initiative in 2011, 16 EU countries have adopted new specific legislation in this field and 11 EU countries have created formal strategies or policies for supporting social economy and/or social enterprise development. Some of these countries have adoped dedicated legal forms for the social economy (e.g. BE, FR, IT, LV, PL, PT) while others have used labelling systems or statutes to address the lack of legal recognition. Examples of countries that have introduced a social enterprise or social economy label include Bulgaria, Denmark, France, Greece, Italy, Luxembourg, Romania, Slovakia and Slovenia. Moreover, accreditation schemes for work integration social enterprises applicable to a plurality of legal forms have been introduced for instance in: Austria, Bulgaria, Croatia, Germany, Poland, Romania, Slovenia, and Spain. Such labelling can also apply to the products and services delivered by social economy entitites or to financial products (see more info in section 4.5).

The two maps below from the 2020 mapping study show the diversity:

Taxation: Diversity of approaches As the 2020 mapping study pointed out: In most countries, the fiscal framework within which social enterprises operate is rather complex and fragmented. "Given their nature, social enterprises in most countries enjoy all those fiscal benefits (or at least many of them) already in place for non-profit organisations, social economy organisations (especially for cooperatives) and mainstream business. Some fiscal benefits depend on the legal forms adopted by social enterprises instead of their activity, as in Italy and in Ireland, in cases in which cooperatives (in Italy) and organisations with charitable status (in Ireland) are exempt from taxation on non-distributed profits. In other countries, social enterprises may enjoy fiscal benefits that are granted on the basis of their activities rather than on the basis of their specific organisational nature." The table below (from the same source) gives an overview about the fiscal benefits granted to social enterprises: Developing social economy ecosystems Some countries with an already advanced ecosystem benefitted from EU support on mutual learning, access to finance and research for social economy organisations. In Central and Eastern Europe and in neighbouring countries (e.g. the Western Balkans), SBI actions and EU funding have played an essential role in the setting up of a social economy ecosystem. Despite progress in many areas, needs persist – although with different intensities across EU Member States and regions.

While some economic sectors like care and social services have a higher share of social economy than other sectors, social economy organisations can be found in virtually all economic sectors. This can make it very challenging to adress their needs. A newly founded social enterprise, trying to scale up a particular social innovation, will face other immediaate challenges than a local farming cooperative with decades of history. On the other hand, there are numerous ways how exchange of experience across sectors can be beneficial for social economy organisations. Common challenges can inspire new creative solutions that would not have been possible without the cross-sectoral exchange of ideas. Estimated data on employment The EESC (2017) study estimates that in the EU the social economy represents more than 82.8 million volunteers, equivalent to 5.5 million (non-paid) full-time workers. This gives an estimated total workforce of 19.1 million people (13.6 million paid and 5.5 million non-paid). Data on employment confirm that social enterprises are generally micro- and small organisations with high proportions of female workers. For example, in Croatia, only one-fifth of social enterprises employ more than 10 workers. Exceptions include France, Italy and Spain, where social enterprises also include rather large organisations. In many countries—including Belgium, Denmark, France and Italy— large numbers of volunteers work with social enterprises. Data on working conditions Statistical data on the quality of jobs and working conditions in the social economy are not availble. However, anecdotal evidence such as the case studies conducted by Eurofound in cooperatives and social enterprises in 2018 in five countries (Italy, Poland, Spain, Sweden, UK) suggests that, overall, workers perceived the quality of jobs within cooperatives and social enterprises to be good, both in absolute terms and relative to other organisations. Managers and workers reported that many of the dimensions of job quality were integral to organisational objectives. Mainstream businesses: increased awareness of social issues Awareness of social issues has also grown among mainstream profit-maximising businesses. For example, Corporate Social Responsibility (CSR) has grown in prominence over the last two decades, to the point that it is now inconceivable for companies of a certain size not to have a CSR policy in place. Benefit Corporations and impact enterprises have also grown in number and incorporate sustainable ambitions in their missions. At the same time other enterprises are adopting ad hoc measures to improve transparency and engage more actively with communities. This trend has been largely driven by an increase in public and consumer pressure. At the same time, social economy business models have served as inspiration for alternative ways to engage in business. These developments can serve as an opportunity for increased cooperation between the social economy and mainstream businesses. 2.3 Efforts in measuring social impact With growing interest in recent years in social enterprises and social impact investment, efforts have increased to try to measure social impact. The idea is that such data can help an organisation identify for itself the strategies that generate the greatest social impact. At the same time, such data can help attract funding from public authorities and social investors. The recent concept of social outcome contracting, for example, introduces the idea of contracting and paying for certain outcomes, rather than activities (outputs), and has contributed to interest in measurement methodologies. As interest in social impact measurement has grown, numerous approaches, tools and practices have been developed, each promoting particular types of indicators. Experts identify a need to further strengthen and support the sharing of know-how, tools and good practice in designing, planning, implementing, measuring, monitoring, and reporting on social impact and social added value. At present there is no indicator database for social impact criteria that can be used by investors and social economy organisations. Some efforts are underway regarding the standardisation of data by providing validated indicators. They constitute a good source to start developing an own indicator set. However, not all possible interventions are covered and indicators often focus on a development aid context. Whilst some of these methodologies are becoming more widely used than others, there is emerging consensus that a “one-size fits all” approach is not appropriate in light of the diversity of social needs, interventions, scale and stakeholder interests. Social economy representatives are therefore increasingly requesting more bottom-up, flexible and differentiated approaches. The 4-year INTERREG project VISES gathered 21 partners and highlighted how the social economy contributes to the dynamism of the territories and to the well-being of their inhabitants. The project illustrated the key features of a relevant social impact evaluation strategy. While promising developments are occurring in relation to social impact measurement and these should be further explored, some challenges need to be acknowledged. For example, measuring impact can be perceived as intrusive and an additional burden, in terms of human and financial resources. Expectations need to be proportionate and adjusted to the nature of the entity (e.g. social enterprises, investment funds) and the stage of development and size of the enterprise in order not to stymie the development of new start ups in the early stages. Concerns have also been expressed about possible unintended consequences of data gathering, especially long-term data. For instance, the importance of not ending up focusing only on easy to measure impacts, rather than considering all aspects of the work of an organisation. Similarly, questions have arisen as to whether measurement dynamics – if poorly designed - could inadvertently actually reduce the scope for innovation if too much pressure from payment schedules is imposed on the delivery of very specifically pre-determined outcomes. Despite these challenges, some promising practices in terms of harmonising reporting standards have emerged at national levels. Examples include the Social Reporting Standard, developed in Germany, and the Canadian Common Approach. Rather than focusing on creating a universal set of metrics that every social economy organisation must narrowly adhere to, these approaches recognise the diversity of drivers, actors and intentions for social impact. Although promising, the continued development of these “middle ground” approaches require extensive consultation at a grass roots level, and creative mechanisms for enabling collaboration between financers and the social economy. The Commission has also started the development of a social economy “canvas”, a visual tool to comprehend the social, environmental and economic implications of social economy activity as well as picturing the value relations between social economy organisations and their community stakeholders.

2.4 Gender dimension In general, high proportions of female workers seem common in the social economy, however no EU-wide reliable and fully comparable data is available. “(I)n Belgium, females comprise 70% of the workforce in social economy, while in France they comprise 67%. Women represent about 61% of Italian social cooperatives’ nonseasonal part-time employees, compared with 47% in other enterprises. In some countries, the creation of flexible jobs by social enterprises is regarded as a positive trend (e.g., Czech Republic, Italy, Lithuania, Turkey) that can especially benefit women. This is the case for both social enterprises led by women and social enterprises that mainly employ women. The high share of women employed is related to the fields of engagement of social enterprises, which also typically account for a high percentage of women when they are managed by public agencies.” However, having a large share of women in the workforce does not prevent issues related to the gender pay gap. While no reliable data is available for all EU Member States and it it is thus difficult to assess the overall situation, some national data is available. For example, the gender pay gap in the French social economy can be partly explained by the strong presence of women in occupations in the health and social sectors. Occupations and jobs in these sectors are often not paid very well and women generally have less access to managerial positions which usually command higher salaries. For example, only 13 % of women employed in the social economy in France are in managerial positions, compared to 22 % of men. In France part-time work is more common in the social economy (38%) than in the rest of the private sector (19%) and the public sector (24%). According to the Global Entrepreneurship Monitor (GEM) an estimated 55% of the world’s social entrepreneurs are male and 45% female. This gender gap in social entrepreneurial activity is significantly smaller than the roughly 2:1 gender gap in mainstream entrepreneurial activity found in some economies. Women tend to pursue entrepreneurial roles in a more social setting – for example, by becoming a social entrepreneur (on the support for female social entrepreneurship see section 4.15) or by making an entrepreneurial contribution in the public sector, as found in an earlier GEM report. For more information about female entrepreneurship see also the most recent edition of OECD & European Commission report “ The Missing Entrepreneurs 2021. Policies for Inclusive Entrepreneurship and Self-Employment ” (6th edition). A number of social economy organisations also specifically target women in their up-skilling and re-skilling work, including female migrants and refugees and women from other vulnerable groups. Fostering the social economy can also have an indirect positive impact on women’s access to the labour market. The reasoning is that, as care burdens in households are still not shared equally between women and men in practice, the provision of high quality, affordable care services by social economy organisations can enable women to pursue their professional development more indepentently because they can turn to professional care services instead of having no other choice than to do the care work for dependent relatives themselves.



3.Collection of evidence and consultations In order to gain a better understanding of the needs of the social economy, the Commission gathered evidence through a variety of studies and reports and consulted a broad range of stakeholders. The feedback from social economy stakeholders confirmed the need for reinforced action at EU level to support the social economy. This section describes how evidence and views from stakeholders have been collected. The first part focuses on relevant studies, the second one describes the process of collecting feedback and contributions, including on the basis of the roadmap published by the Commission. An analysis of the contribution is provided in chapter 4. 3.1 Evidence and data collection A number of recent studies fed into the preparation of the action plan for social economy. The most important ones are: -The study on the impact of the Social Business Initiative and its follow-up actions (2020): Based on 326 interviews with public authorities, stakeholder organisations, experts and practitioners, the study provides a comprehensive evidence-based analysis of the impact of the Commission’s 2011 Social Business Initiative on the development of social economy organisations and their operating environments at both national and EU levels. -The EU mapping study on social enterprises and their ecosystems (2020): it is currently the most comprehensive source presenting a comparative overview of social enterprises and their operating environments in Europe. It covers 35 European countries. -The European Economic and Social Committee report on the recent Evolutions of the Social Economy in the European Union (2017): it provides aggregate EU level figures on the whole social economy, its importance in terms number of entities, number of jobs and to a certain extent its economic weight. -A set of policy guidance and tools elaborated by the European Commission in cooperation with the OECD in relation to specific aspects of social economy and social entrepreneurship developments. A number of the related OECD / EU reports have been used to gather evidence relevant for the drafting of the action plan: § Policy brief on Social Entrepreneurship

o10 November 2020: “Social Economy’s vision for a Green and Fair Transition”; o18 February 2021: “Skills and Digitalisation: Investing in the Social Economy as tomorrow’s economy”; o7 October 2021: “Social Economy as an Industrial Ecosystem – A catalyst to Build Back Better & Fairer”. ·A series of social economy stakeholders also organised relevant conferences and events. Targeted consultation The Commission invited stakeholders to provide input through various channels: ·The broad consultation process from 14 January to 30 November 2021 on the action plan for the implementation of the European Pillar of Social Rights; ·The ‘Have your Say’ web page of the European Commission, where stakeholders could provide feedback on the roadmap on the action plan (for details see section III); ·The European Commission expert group on the social economy and social enterprises (GECES) meetings and its 2016 report on “Social enterprises and the social economy going forward”; ·A specific consultation of the GECES on the topic of “Social economy and State aid for access to finance” at the meeting on 10 September 2021, with an invitation to provide written comments in the weeks following the meeting; ·The strategic dialogue between civil society and the European Commission in November 2020. ·Bilateral meetings with stakeholders such as Social Economy Europe, Concorde Europe, Social Services Europe, CG Scop, CECOP, European Foundation Centre, Dieses, Union for the Mediterranean, AIM, EASPD, Red Cross, Caritas. Ad hoc input and position papers The Commission also received ad hoc input and position papers from stakeholders. These included a position paper developed by France and supported by Belgium, Bulgaria, Italy, Luxembourg, Portugal, Spain and Slovakia. 3.3 Publication of the SEAP roadmap In spring 2021 the European Commission published a roadmap on the upcoming action plan, inviting stakeholders to provide their input. The Commission received feedback both through the dedicated website and other contact channels. Roadmap feedback

Via a dedicated web page , open from 1 March until 26 April 2021, stakeholders and citizens could submit their feedback (without pre-set questions) on the roadmap for the action plan for the social economy. The Commission received 132 contributions and 46% of submissions came from NGOs – within and beyond the social economy. Business associations accounted for 13% of total submissions, public authorities for 8%, and business organisations for 7%. Further contributions came from research institutions (4%), consumer organisations (2%), trade unions (2%), as well as from EU (2%) and non-EU citizens (2%). Distribution of contributions from citizens and organisations (N=132) In total, the Commission received contributions from 25 countries, including 21 in the EU. Stakeholders’ contributions very much echoed the needs identified in the context of the evidence gathering process. They called for an improvement of access to funding and markets for social economy actors, as well as for advances in policy and legal frameworks better reflecting their characteristics. In addition, several asked to increase the recognition, visibility of and awareness about the social economy, in particular through the inclusion of a clear and inclusive definition of the business model. A number of contributions formulated very concrete proposals.



4.Challenges and opportunities for the social economy – Main findings from the consultations 4.1 On the action plan for the social economy in general A strong consensus emerged amongst the contributions on the importance of the action plan for the social economy and its strong relevance in the current context. Stakeholders appreciated the EU’s efforts in supporting the social economy’s visibility. A number of key themes were identified in the feedback gathered. 4.2 Defining social economy at the European level The SBI study pointed out that future policy initiatives should take into account the different needs of the diverse types of organisation (e.g. cooperatives, mutual benefit societies, associations, foundations, social enterprises). Main problems / challenges as perceived by stakeholders and experts ·Lack of a common definition and understanding of social economy at European level impedes the development of consistent EU policies and support instruments ·Lack of a common definition of social enterprises at European level hinders awareness raising initiatives and impedes the formation of a basis upon which tailored and effective policy can be formulated ·There is no common definition of “for benefit” or “limited profit” enterprises ·Inclusive enterprises for persons with disabilities are not always considered part of the social economy Suggestions from stakeholders A number of stakeholders called for a clear EU level definition of the social economy concept. A few advocated a homogenous, binding definition at EU level, whilst most others stressed the need for an EU definition to respect the diversity of social economy organisations and the heterogeneity of national traditions. There was also a call for the explicit inclusion of specific types of entities, e.g. not-for-profit social service providers. European social partners argued that the definition would be best created at Member State level. Commission analysis The Commission will aim to retain a broad and inclusive definition of the social economy, which respects Member States’ heterogeneous traditions. The fact that there are very diverse traditions and definitions means that a very precise (and therefore somewhat narrow) definition of social economy would likely exclude some organisations and can therefore not be assumed to be in the best interests of the social economy in Europe. Only a broad and inclusive definition takes into account the existing diversity and preserves the possibility to pursue a variety of approaches (at Member State level, as well as at the level of individual organisations).

4.3 Enhancing awareness and visibility of the social economy The visibility of the social economy and social enterprises has increased considerably since 2011. The Social Business Initiative has helped to increase the visibility, recognition and understanding of social enterprises. It contributed to facilitate the availability of information on social enterprises, to implement mutual learning, research, and visibility measures related to the social economy and social enterprises in EU programmes. The SBI also helped to disseminate the social enterprise concept across EU Member States and to raise awareness on the social economy as a broader dynamic in policy debates. Social enterprises and other social economy organisations (SEOs) are increasingly considered as important actors, not only by policymakers in social policy, but also in other policies (regional development, cohesion, innovation, climate, environment). Further awareness raising efforts would nevertheless be beneficial. The SBI study identified a need for more visibility, better understanding and recognition of benefits and obstacles, for example in national legal and fiscal frameworks. Social impacts of social economy organisations need to be better understood and reported. Continued efforts in generating solid knowledge and high quality data about social economy are needed to inform EU, national and local policies, to stimulate mutual learning and to inspire common agendas according to the 2020 mapping study. Main problems / challenges as perceived by stakeholders and experts ·Lack of visibility, recognition and significance of the social economy sector within the EU ·Lack of indicators and data on the real socio-economic impact and value of the social economy ·Lack of understanding and promotion of EU opportunities for social economy stakeholders ·Lack of visibility of the social economy in European processes and initiatives such as the European Semester and the European Pillar of Social Rights ·Member States lack awareness on the particular characteristics of the social economy ·Social economy actors are not fully recognised for their valuable contributions during the COVID-19 crisis Suggestions from stakeholders Visibility Stakeholders and experts drew attention to the role of the action plan for the social economy in increasing the visibility and recognition of the sector as a whole and of its enterprises in particular. Stakeholders such as RREUSE and the International Labour Organisation (ILO) called for mainstreaming the social economy at EU and national levels, respectively. At the European Social Economy Summit, several speakers emphasised the importance of raising political awareness on the advantages of socially inclusive economic growth. A position paper developed by France and supported by Belgium, Bulgaria, Italy, Luxembourg, Portugal, Spain and Slovakia stressed that research initiatives on the social, environmental and economic added value of social economy structures should be encouraged through the Fi-compass platform or European universities. Eurofound suggested that, building on work already undertaken by the European Commission, the existing and emerging types of cooperative and social enterprises should be further clarified in order to collect a robust and consistent evidence base. In addition to this, the Mannheim Declaration suggested that the European Commission increase the sector’s visibility by encouraging other interested regions, cities and municipalities to join the European Social Economy Regions (ESER) initiative. Other visibility initiatives referred to included the European Social Economy Capital initiative set up by the Monitoring Committee of the Luxembourg declaration. In addition, efforts have been made to raise awareness on the social economy through the development, in recent years, of a large number of awards and prizes a developed at various levels (see Annex 3 for a list of examples). Commission analysis Better visibility, understanding and recognition of the benefits and obstacles for the social economy continue to be important. Raising awareness and improving communication on support opportunities for stakeholders have a big potential to boost the social economy, (especially in countries where it is currently less developed. Therefore, awareness raising and disseminating information will be important. Young people, who may be the social entrepreneurs of the future, should be included in these efforts. Economic and business faculties of universities could be targeted with information about the social economy with a view to presenting it as a potential career path. 4.4 Support for specific target groups In a number of contributions stakeholders called for an enhanced awareness and support for their area(s) of work and their target groups (including mainstreaming the issues and target groups into various EU programmes). Main problems / challenges as perceived by stakeholders and experts ·Lack of awareness for the work with specific target groups ·Lack of awareness on the concept and benefits of Work Integration Social Enterprises (WISEs), including those employing persons with disabilities, and cooperative enterprises ·Lack of data on the impact of the COVID-19 pandemic on the rights of workers with disabilities, particularly female workers with disabilities ·Lack of understanding about the social economy and social entrepreneurship among young people Suggestions from stakeholders Some stakeholders identified a lack of data as an issue to address. EVPA suggested to collect data on equality and disparities of different vulnerable groups (on the main topics under the European Pillar of Social Rights) for designing more targeted solutions. Another suggestion made, was to disaggregate collected data to highlight the percentage of social entrepreneurs led by vulnerable and marginalised groups. Eurodiaconia suggested that the European Commission should launch research into the methods of successful mainstream workplace integration of people with disabilities, people who experience homelessness and the long term unemployed.

A number of specific target groups have been highlighted in the contributions from stakeholders. The list below is by no means exhaustive, but may serve as a reminder about the wide range of groups and individuals social economy organisations support with their work on a daily basis. Persons with disabilities The European Observatory for Inclusive Employment and Sustainable Development Goals and Eurodiaconia suggested the European Commission and national governments should promote and fund projects and transnational mutual learning exchanges that facilitate the reintegration of persons with disabilities into the regular labour market (including through the ESF). The European Observatory for Inclusive Employment and Sustainable Development Goals asks to ensure that non-discrimination on the basis of disability and work integration of persons with disabilities remains a requirement for EU funding allocation, in particular for the current initiatives taken to support employment retention and promotion. A number of stakeholders called for an increase in recognition and visibility of the positive socio-economic impact of work integration social enterprises (WISEs) by the EU and its Member States. The European Commission should organise awareness raising activities for Member States, together with social services providers in order to showcase WISEs' contribution. Other suggestions included: -Ensure that EU-level funds can be easily accessed to finance projects around education, training, lifelong learning, skills development and traineeship-to-employment programmes, in order to equip workers with disabilities with knowledge and competences that match the demand for green, digital and in-sourcing skills – European Observatory for Inclusive Employment and Sustainable Development Goals -Support conditions for unrestricted access to in-company vocational training for young people with disabilities and to individually adapted vocational preparation measures for the transition from school to working life – European Confederation of Inclusive Enterprises (EUCIE) and Spanish Council for the Defense of Disability and Dependency (CEDDD) -SEAP should address the responsibility of social enterprises to focus on training and skilling their employees with disabilities to facilitate career progression and a transition into the open labour market if the employee wishes to. Particular efforts must be made to ensure that training programmes are made accessible for persons with disabilities, and that workers are free from discrimination when it comes to promotions and pay-scale progression – European Disability Forum -SEAP must recognise the differing roles played by social economy enterprises and social services towards the inclusion of persons with disabilities – (CEDDD) -Raise awareness of all employers that the talents of persons with disabilities can be used in these times as well and that workers with disabilities can actually be “co-creators of COVID-19 responses. The SEAP should explore the importance of persons with disabilities not only as employees in social enterprises, but also as entrepreneurs who want to create their own business or start-up. -Recognise the crucial role played by work integration social enterprises employing persons with disabilities (D-WISE) in promoting employment for persons with disabilities in the next European Disability Strategy. The SEAP should clearly recognise the value of social economy entities in providing employment opportunities for persons with disabilities. -Fund EU level projects and research aiming to improve the understanding of work integration social enterprises employing persons with disabilities (D-WISE) across EU Member States – European Observatory for Inclusive Employment and Sustainable Development Goals. Roma ERGO Network pointed out that social economy holds a great potential to positively contribute to a sustainable and inclusive recovery, where the Roma are not left behind, but supported towards better social and economy outcomes, while combatting prejudice and promoting peaceful coexistence. In their view, WISEs represent a good solution for the preservation of Roma traits and crafts that are on the verge of being forgotten. The ERGO network also suggested to mainstream social enterprises and the social economy into EU law, policy, and programmes and spell out Roma as a key target group in EU initiatives such as the EU Roma Integration Framework, Youth Guarantee and Child Guarantee. Legislative proposals should strive for social inclusion and clearly name Roma communities among the intended beneficiaries.

They call for all social economy actors to be mindful of deeply-rooted discrimination and anti-gypsyism in all countries and make conscious efforts to combat any such tendencies in their work. People experiencing homelessness FEANTSA reminded that it should be recognised that homeless services are first and foremost provided by not-for-profit organisations and that employment and social economy policies can play an important part in approaches and solutions to preventing and ending homelessness in Europe, but that they are not a guaranteed solution to all of that challenges that a homeless person might face. From the perspective of the homelessness sector, the European Platform for Combatting Homelessness is the flagship initiative to prevent and reduce homelessness in the EU. FEANTSA suggested that the innovative approaches and inspiring examples arising from the Platform should be channelled into the social economy sector via the SEAP. Models of social enterprises that are designed specifically for people experiencing homelessness and their unique needs and obstacles to accessing the labour market should be promoted. Migrants Migrants, refugees in particular, often are in need of support when they first arrive in a new country. Social economy organisations contribute significantly to the integration of migrants and refugees, at the different stages of the integration process. The earlier the access to the labour market, the more effective the integration process. Social economy organisations can also provide labour opportunities with specifically adapted conditions, for example in terms of linguistic support, which can have an overall positive effect on the participation to the labour market. The Municipality of Lampedusa and Linosa pointed out that social economy opportunities for migrants can speed up their process of integration, helping them in becoming a productive member of the European society and local community. In their view this can lead to wider societal change: “Through social economy, local European Citizens can reimagine the economic model of their communities shaping new sustainable entrepreneurial initiatives based on new societal context (result of migration) and ready to answer to the new needs”. Youth Young people, especially from disadvantaged backgrounds, are also a target group for the work of social economy organisations and can benefit from their activities. The overall increased awareness of environmental and social issues among young people, combined with a rising interest in entrepreneurship with social impact, could potentially make social entrepreneurship the careerpath of choice for many dedicated young professionals. In addition to social entrepreneurship, the cooperative model has been found to be an attractive option with viable employment opportunities for young people. Despite its potential, however, many young people remain unaware of social economy business models and their opportunities. In this sense, several stakeholders and experts stressed the importance of promoting awareness and recognition of the social economy among young people, in order to promote a transition towards a more sustainable and fairer society. To reach this objective, stakeholders suggested that efforts be made to include teaching on the social economy in schools and universities. Social Economy Europe and ConcertES called for the development of Erasmus+ opportunities on social entrepreneurship. Some stakeholders focused particularly on cooperatives, underlining the importance of raising awareness about the cooperative model among young people. On this, CECOP and ZLSP Poland suggested that professional trainings be developed within cooperatives and on the cooperative model, particularly targeting young people. Women The gender dimension was mentioned in the contributions, mainly in calls for promoting female entrepreneurship and gender equality as a whole. Indeed, in their position papers, a number of stakeholders called on the European Commission to ensure that full gender equity is mainstreamed throughout the action plan for the social economy and that specific attention be given to fostering and supporting female-led social enterprises. On gender and working conditions, the European Disability Forum invited the action plan for the social economy to pay particular attention to furthering the employment quality of women with disabilities. They added that the action plan should seek to combat harassment, including sexual harassment, faced by women with disabilities working in social enterprises. At the Social Economy Summit in Mannheim, experts highlighted the challenges faced by women between the ages of 45 and 65 that undertake both work and care responsibilities. To this end, they stressed the value of career coaching and the importance of work-life balance and promoting a more inclusive labour market. Commission analysis These stakeholder inputs confirm how the social economy serves a variety of target groups. Each of these target groups is important and indirectly covered by most of the actions in the action plan, even if not spelt out explicitly each time. 4.5 Developing policy and legal frameworks

The Social Business Initiative and its follow-up activities have had important effects on the regulatory and institutional operating environments of the social economy and social enterprises. Main problems / challenges as perceived by stakeholders and experts ·Social economy entities are not legally recognised at the European level ·The framework conditions for the creation and growth of social enterprises are mainly implemented at national level. Some stakeholders would like to see a stronger role for the European level. ·The diversity of enterprise models operating in the EU is not sufficiently taken into account when legislation is drafted or revised ·The particularities of work integration social enterprises (WISEs) and WISEs employing persons with disabilities (D-WISE) are not always taken into account in policy development related to the social economy ·Social economy entities are excluded from accessing certain opportunities due to lack of information on and awareness about their legal forms ·Certain national enterprise development finance and support programmes, many of which are funded by EU funds, still exclude social enterprise legal forms, even when they meet the EU’s definition for SMEs ·Social economy entities are excluded from accessing certain opportunities due to non-inclusive legal criteria Suggestions from stakeholders Several stakeholders, experts and Member States, as well as the Mannheim Declaration, provided suggestions on improving policy and legal frameworks related to the social economy. Throughout the consultation process, stakeholders and experts called for more inclusive EU legislation, strengthened social dialogue and proposed new policies and initiatives. While presenting their comments, many underlined the diversity of social economy actors. In response to the roadmap consultation, several stakeholders called on the EU to promote and support Member States in setting up appropriate framework conditions, as well as guide them in improving their social economy ecosystems. To this end, the European Confederation of Inclusive Enterprises and the Spanish Council for the Defense of Disability and Dependency (CEDDD) suggested that a permanent support system for the social economy be established at European level to later be transposed into the national legal systems. On this topic, the Mannheim Declaration pointed out that “(…) [t]he development of appropriate legal, regulatory and fiscal frameworks must (…) emerge from the national and local environments in which social economy enterprises and organisations operate." In their contributions, stakeholders further underlined that the diversity of enterprise models operating in the European Union must be considered when legislation is drafted or revised. To this end, Social Economy Europe and AIM suggested that a protocol on the diversity of forms of enterprises in the EU be adopted as an annex to the Treaty on the Functioning of the European Union (TFEU), including the social economy actors and their different legal forms. On social dialogue, several stakeholders underlined that the action plan should address the need to further develop and promote social dialogue and collective bargaining in the social economy. Some stressed that this would be particularly relevant for the social services sector, where current workforce challenges must be addressed. Working conditions in the social economy overall are understood to be good, but some concerns have been raised, especially in situations when public tenders are solely based on cost (see section 4.8). On working conditions, several GECES experts pointed out the lack of data on the topic and called for the collection of more information with a view to improve policies. However it was recognized, that gathering data on this topic would be a complex matter and it would need to include a comparison with the situation in traditional (for-profit) businesses. Eurofound suggested that national working conditions surveys should provide a separate analysis of the working conditions in social economy organisations. In addition, the European Observatory for Inclusive Employment and Sustainable Development Goals had a more specific request, calling on the European Commission to collect data and support research on the impact of the COVID-19 pandemic on the rights of workers with disabilities, taking a gender-sensitive and intersectional approach. The Commission also received several suggestions concerning labels and certification of varied scope. The Mannheim Declaration invites a reflection on labels and certification “to boost the recognition of products, services and enterprises and highlight the social economy’s role in tackling societal challenges”. While RREUSE called for the creation of a European social label specifically for social economy products, the GECES working group set up for preparing InvestEU looked at the feasibility of social finance labels. The latter concluded that such labels could play a role in helping mobilise finance for social purposes, but that independence would be crucial for their credibility. The experts also cautioned that labels can be costly and complex to set up and manage and EU labels were not realistic. In a different vein, in response to a Commission consultation of the GECES on State aid, the French authorities highlighted the French accreditation framework enabling State aid for social enterprise financing (“solidarity-based enterprise of social utility”), designed to create an asset class for channelling long-term private savings towards social companies, with fiscal incentives for risk finance investors through income tax reductions. Commission analysis Member States are responsible for putting in place policy and legal frameworks supporting the development of the social economy at national level. The diversity of starting points means that a “one size fits all” approach is not feasible and supporting the social economy will require different approaches. The Commission can play a supporting role by providing guidance, fostering mutual learning and the exchange of good practices regarding policies and legal frameworks. Regarding labels and certification/accreditation, the Commission can facilitate a reflection on schemes existing at national level, their purposes, and how they can help to strategically unlock new opportunities for the social economy, including in relation to State aid. 4.6 Social economy and State aid Main problems / challenges as perceived by stakeholders and experts ·Lack of awareness of State aid rules and their impact on social enterprises ·EU competition and State aid rules do not always match the specific features of the social economy ·The General Block Exemption Regulation is perceived as overly complex and as not taking fully into account the specific needs of the social economy ·The complexity of some Services of General Economic Interest (SGEI) rules hinders the allocation of SGEIs to social economy organisations ·Local authorities lack awareness on the procedures for implementing State aid under the General Block Exemption Regulation Suggestions from stakeholders Several stakeholders and experts made comments and suggestions on the social economy and State aid throughout the consultation process. Many highlighted the need to revise and adapt EU competition and State aid rules to the particularities of social economy entities and called on specific changes to legislation and initiatives. In response to the roadmap, several stakeholders called for the State aid General Block Exemption Regulation (n° 651/2014 of 17 June 201) to be modified in order to better take stock of the specific needs of the social economy, while others underlined that the complexity of the legislation should be addressed. On improving legal frameworks, a position paper supported by eight Member States suggested that the State aid General Block Exemption Regulation introduce a definition for social enterprises, based on the definition already enshrined in Regulation (EU) no 346/2013. On this topic, the Mannheim Declaration pointed out that “(…) [t]he development of appropriate legal, regulatory and fiscal frameworks must (…) emerge from the national and local environments in which social economy enterprises and organisations operate." In their position paper, the Five Flemish provinces & Association of Flemish Provinces explained that the complexity of State aid rules and regulations leads many local/regional governments to resort to de minimis, which do not serve the social economy adequately. Indeed, several stakeholders made reference to the de minimis Regulation in their position papers. Some called for an increase of the threshold of de minimis State aid provided for services of general economic interest, while others emphasised that EU discipline with regard to de minimis rules must be respected and implemented in national grant programmes. Also on State aid, some business representatives present at the social partners’ consultation spoke in support of extending the maximum duration of wage subsidies for the recruitment of disadvantaged and severely disadvantaged workers under the General Block Exemption Regulation. Along these lines, in response to the roadmap, ENSIE and ConcertES pointed out that the General Block Exemption Regulation should be revised regarding the definitions of disadvantaged and severely disadvantaged workers and the aids for their employment and training.

In response to a Commission consultation of the GECES on state aid, the French authorities highlighted the French accreditation framework enabling State aid for social enterprise financing (“solidarity-based enterprise of social utility”) (see previous section). Commission analysis The current possibilities allowed by the existing State aid framework are not always fully exploited, therefore awareness raising is needed. The revision process in connection with the expiry of the General Block Exemption Regulation in 2023 will be an occasion to consider the potential need for changes. 4.7 Taxation Main problems / challenges as perceived by stakeholders and experts ·Lack of awareness of how EU fiscal rules can be used to maximise investment into the social economy ·Lack of a favourable VAT framework for social enterprises and organisations ·Lack of tax exemption initiatives aiming to incentivise investors to provide financial support to social entrepreneurs ·The social economy sector is rarely mentioned in EU taxation policies ·The cuts to public expenditure over the last decade have damaged the development of the social economy Suggestions from stakeholders Several stakeholders and experts made comments and suggestions on taxation throughout the targeted consultation process. In response to the roadmap, several stakeholders highlighted the need to ensure that the EU’s taxation policy favours the development of social economy actors and called for facilitating taxation measures (i.e.: special rates of VAT) for the social economy. Similarly, other stakeholders called for a favourable VAT framework for social enterprises active in the circular economy and underlined that the EU should incentivise investments in social entrepreneurs and enterprises through tax exemptions. Along these lines, Philanthropy Advocacy suggested that the implementation of the non-discrimination principle be improved and called for a fairer VAT deal for public-benefit organisations via a code of conduct. RREUSE pointed out a problem with VAT leading to incentives that work counter to the logic of sustainability: in many cases it is currently cheaper for manufacturers and retailers to destroy usable goods (including new goods) than to donate them to non-profit organisations (because VAT payments are required for donations). In their position paper, the European Association of Service providers for Persons with Disabilities (EASPD) explained that the EU’s fiscal rules and promotion of cuts to public expenditure over the last decade have damaged the development of the social economy, in particular the development of the social services sector, whose structural vulnerability is in large part caused by underinvestment. In this sense, they called for the action plan for the social economy to demonstrate how EU fiscal rules can be used to maximise investment into the social economy, including through the flexibility clause. Commission analysis The fiscal framework within which social economy organisations operate is largely defined by Member States subject to EU legislation and is in many cases rather complex and fragmented. An exchange about existing practices can be suggested to support the Member States who are interested in fostering the social economy ecosystem in their country. Facilitating such exchanges may help to identify best practices and cross-border learning. Donations are not subject to VAT but the VAT paid on goods donated cannot be deducted. While rules on VAT deduction may merit proper assessment (especially with view to the green transition), the issue goes beyond the objectives of the social economy action plan and would require an impact assessment that could also look at potential issues of tax avoidance and distortion of competition. 4.8 Better access to markets: socially responsible public procurement While access to public markets was in principle facilitated by the latest overhaul of EU public procurement rules, social economy organisations still largely fail to seize the opportunities deriving from public tenders. There also remains a lot of untapped potential for scaling up social entrepreneurial activities on the basis of private procurement and partnerships with mainstream enterprises (see SBI study). Capacity building is needed to strengthen managerial skills and professionalisation, but also to better prepare the public sector and financial intermediaries for working with social economy organisations (see SBI study). Main problems / challenges as perceived by stakeholders and experts ·The Treaty on the Functioning of the European Union (TFEU) does not fully reflect the diversity of companies operating in the Single Market ·EU trade agreements do not systematically include measures to support the social economy sector ·The social economy sector is not visible within the public procurement directives ·Socially responsible public procurement is not sufficiently promoted within the EU ·Social economy entities do not know how to identify and successfully bid for public tenders ·Lack of incentives for private procurement from social enterprises ·Most procurement officials (public and private) do not have the necessary skills and background knowledge to prepare tenders that are accessible to social economy actors. ·Member States and public authorities are not sufficiently aware of the significant opportunities Directive 2014/24/EU on public procurement can generate for Work Integration Social Enterprises (WISEs)



Suggestions from stakeholders

Better access to markets is a priority for numerous stakeholders. They highlighted the need to improve the legal framework, facilitate public and private procurement, build partnerships and stimulate cross-border operations. In particular, several stakeholders argued in favour of a revision of Article 54 of the TFEU to better reflect the diversity of actors operating in the Single Market . Along these lines, some stakeholders emphasised the need to improve equal access to the Single Market for the social economy . GECES experts and Social Economy Europe stressed the importance of promoting socially responsible public procurement in Europe in general. Other stakeholders called more specifically for an increased use of social clauses and reserved contracts in public procurement. Similar comments were also noted at the European Social Economy Summit. In the GECES meeting of 23 March 2021, it was stressed that public tenders were still often awarded solely on the basis of the price criterion and that this had a negative effect on the working conditions in the social economy. On the subject of improving access to markets, some Member States and GECES experts pointed out that cross-border cooperation remains difficult. To overcome these barriers, several stakeholders called for a legal recognition for associations, foundations and mutual benefit societies at European level. The Walloon Region encouraged partnerships between social economy stakeholders in the traditional economy. Cooperation between social entrepreneurs and the traditional entrepreneurial ecosystem (e.g.: accelerators, incubators, chambers of commerce, development agencies) should be strengthened. Different types of partnerships could be established according to the desired area of exchange and mutual learning: local partnerships, partnerships between entrepreneurs, international partnerships, etc. Commission analysis The Commission shares the analysis by stakeholders that better access to markets and public procurement should be one of the priorities of the action plan. Special attention will be given to further encouraging the development of socially responsible public procurement. This will require further engaging with Member States and continuing to raise awareness and offer dedicated training. 4.9 Promoting the social economy at regional and local levels Given the significant differences between national/local contexts, there is a need to build capacity at local and regional level and tackle the specific needs of cross-border social economy organisations in rural and peripheral areas (see SBI study). The European Social Economy Regions ( ESER ) intitiative was highlighted as a successful initiative in the SBI study. Main problems / challenges as perceived by stakeholders and experts ·Need to improve access by local governments to European funds and programmes, such as the European structural and investment funds ·Weak link between the EU and local levels, which hampers the development of social enterprises in certain regions ·Lack of awareness on the role of the social economy sector in local communities ·Small and local social enterprises struggle to access the resources they need Suggestions from stakeholders Throughout the targeted consultation process, stakeholders and experts stressed the need to focus on local partnerships and the regional level. For example, SEE suggested that local partnerships between regional and local authorities and the social economy should be further supported. Along these lines, the city of Strasbourg called for improved dialogue and collaboration with local authorities to strengthen the ties between the local and EU levels. Strasbourg also outlined that the “[t]he Commission should encourage tools and dynamics of territorial economic cooperation” and CIRIEC recommended enhancing cooperation between social economy actors and the public sector. REVES, RTES and the Conseil Supérieur de l’Economie Sociale et Solidaire called for initiatives to promote the exchange of good practices between local governments and their ecosystems. Also on territorial dimension, REVES suggested the establishment of a task force to ensure that EU measures take the local and regional perspectives into account. Along these lines, CG SCOP pointed out that developing cooperatives that meet citizens’ needs could contribute to the revitalisation of territories. CECOP and REVES highlighted the need to further promote Community-Led Local Development approaches and good practices. Commission analysis The Commission agrees with the analysis of stakeholders that the regional dimension is of particular importance for the development of well-functioning social economy ecosystems. Well-developed regional social economy ecosystems are a way to create new jobs and more efficient than increasing public spending for unemployment. Providing support to local and regional social economy stakeholders (including through capacity building and cross-border networking opportunities) is likely to be an important way forward. 4.10 Promoting the social economy at international level Main problems / challenges as perceived by stakeholders and experts ·Lack of a common understanding of social economy at the international level ·The social economy is not well known to EU delegations, who lack adequate training and information on its particularities ·Lack of data and information on the challenges and experiences faced by the social economy in partner countries ·The social economy is scarcely mentioned in EU external action ·Social economy ecosystems are being developed unevenly in developing countries ·Non-EU social economy organisations are not always eligible for EU programmes and initiatives

Suggestions from stakeholders Several stakeholders and experts pointed out the importance of developing the social economy beyond the EU. Throughout the consultation process, many emphasised the need to inform EU delegations about the social economy, called for intiatives to further develop the social economy in the EU neighbourhood and beyond, and encouraged EU institutions to cooperate with international and regional organisations on the topic. In the GECES meeting of 23 March 2021, a number of experts called for further research on the development of social economy ecosystems in different parts of the world. On cooperation with international organisations, some GECES experts underlined that it was key to work with actors such as ILO, UNTSFSSE or OECD. Moreover, stakeholders called for the social economy to be put on the agenda of global fora and conferences such as the UN General Assembly, G7 and G20 and the COP Climate negotations. At the European Social Economy Summit, several speakers emphasised the need to look “beyond Europe”. Here, the importance of promoting social businesses at the upcoming EU-Africa Summit was also underlined. Commission analysis The topic of social economy in general has been receiving increased levels of attention in various international fora in recent years. The Commission can continue to cooperate with key international partners to make good use of this momentum. In addition, the social economy can be addressed in the EU’s neighbourhood and enlargement policy as well as in international cooperation. More can be done to enhance mutual learning and exchange of practices between the EU and third countries. 4.11 Improving access to funding The Social Business Initiative and its follow-up activities have made it easier for social enterprises to access public and private funding. Interviewed stakeholders highlighted the role of EU policies and EU funds as a key driver for strengthening social economy ecosystems. They considered that the general SBI objectives remain relevant and that needs persist: access to finance continue to be an important need according to the SBI study. Main problems / challenges as perceived by stakeholders and experts ·Information on EU funding opportunities (i.e.: funds, existing financing opportunities and new opportunities linked to Next Generation EU) is unclear to social economy stakeholders ·EU and national financing opportunities are not tailored to the needs of social economy organisations ·The procedure, criteria and requirements of EU programmes and funds are not adapted to the specific features of social economy actors, which leads many to be excluded from these opportunities ·The social economy sector has not been sufficiently supported in the Recovery and Resilience plans proposed by Member States ·Social enterprises are excluded from certain EU financial instruments because the definitions adopted do not reflect the broad spectrum of organisations operating in the Single Market ·SME programmes such as COSME or fund-of-funds such as the Social Impact Accelerator fail to adequately address the specificities of social economy actors ·Lack of financial and technical assistance instruments designed for the social economy sector ·No strong culture of data collection and measurement across social economy actors, including investors Suggestions from stakeholders Improving access to funding was a key topic raised by experts, stakeholders and some Member States in official meetings, relevant conferences and events and in position papers. Overall, stakeholders and experts pointed out the need to adapt eligibility criteria and legal requirements to the particularities of social economy actors, provide access to both financial and non-financial support, and create new funding schemes. In response to the roadmap, the Commission also received suggestions on how to improve access to funding for entities in this sector. For example, a number of stakeholders called for the creation of an EU online platform that could support social economy actors in accessing EU funds and opportunities. In the GECES meeting of 18 June 2020, experts underlined that requesting access to EU funds is too complex and called for the creation of a specific EU fund for social economy actors. At the European Social Economy Summit stakeholders expressed a need for clearer communication efforts between the European Commission and national public institutions, as well as between the national/regional authorities and social investors. On the specific case of philanthropic organisations, a number of stakeholders suggested that EU and national measures should be developed to stimulate foundation engagement into social business. EVPA signalled the need to create a generally accepted framework for Impact Measurement and Management (IMM) practices and suggested a closer cooperation between the social economy and the academic world, as well as the establishment of a pan-European database on IMM practices. A position paper supported by several Member States identified similar challenges and called on the European Commission to give a mandate to the EIB Group to develop technical assistance and financing tools tailored for social economy players. ESS Forum International called for new financing instruments to provide seed capital and acceleration capital for social economy projects, while Euclid Network called for investments in existing impact funds which support the social economy. Commission analysis Improving access to funding is a key topic for supporting the social economy. It transpires from the feedback that many social economy stakeholders are unaware of the EU funding opportunities available to them, including the instruments specifically designed under the EaSI programme 2014-2020, which addresses many of the reported needs. Improvements can be made to the information available on funding opportunities specific to the social economy, as well as on opportunities in other EU funding programmes. It is important to foster synergies among funding instruments and to continue mobilising private finance, patient capital and advisory support, tailored to the needs of social enterprises and social economy organisations. A revised set of financial instruments will be set up under InvestEU, building on those developed under the EaSI programme 2014-2020 and EFSI and managed for the European Commission by the EIF and other implementing partners. Concerning the suggestion regarding the involvement of the EIB Group, the involvement of the EIF (part of the EIB Group) in these funding tools already effectively addresses this concern. In addition the Commission developed technical assistance and other financing tools to boost the supply and demand side of social enterprise finance. InvestEU and the EaSI strand of the ESF+ programme will enable these kinds of support measures to be renewed.

4.12 Boosting social innovation The issue of how to scale and/or replicate social innovations is a recurring theme among stakeholders since several years. Various challenges are identified. Main problems / challenges as perceived by stakeholders and experts ·Bureaucratic burdens hinder the development of smaller social innovation projects and organisations ·Lack of opportunities for mutual learning and exchange between social innovation projects funded in the framework of EU cohesion policy ·Difficulty in scaling up and mainstreaming social innovations ·Difficulty in getting public authorities to take up social innovations proven to be effective elsewhere Suggestions from stakeholders Several speakers and experts stressed the need to support and promote social innovation and social entrepreneurship across Europe. This included the need to create mechanisms to scale and/or replicate successful social innovations. For example, the initial investment (often with public funds) is not capitalised on if the results of successful initiatives fail to be scaled or replicated. In response to the roadmap, several stakeholders called for the exchange of good practices and experiences on social innovation. In their position paper, REVES expained that its members have expressed a lack of opportunities for contacts and exchange between projects funded in the framework of EU Cohesion Policy, including the European Agricultural Rural Development Fund. Calling for the encouragement of a more collaborative approach to innovation, EURICSE pointed out that this approach could create greater awareness of the role that the social economy plays in social innovation. In their position papers, REVES and the ILO stressed the need to improve connections and exchanges between existing projects and initiatives. Along these lines, Center Noordung suggested the creation of mentoring partnerships between emerging socially innovative initiatives and those that are already successfully operating. As a concrete proposal, Center Noordung and Catalyst 2030 suggested the development of a network of social innovation ambassadors, where staff from sectoral agencies, business support organisations, SMEs and big enterprises could be trained for social entrepreneurship and on social innovation. Commission analysis It is important to foster social innovation but also to widely spread knowledge about new approaches and models to facilitate scaling and replication. Organising mutual learning and capacity building for relevant authorities and building support structures (like competence centres) can help to transfer and scale up social innovation, and hopefully achieve systemic impact. 4.13 Fostering digitalisation and new technologies Main problems / challenges as perceived by stakeholders and experts ·Lack of digital skills in the social economy sector ·The digital gap has been reinforced during the COVID-19 crisis ·Many social enterprises are yet to undergo digital transformation as they lack expertise in digitalisation ·The value of technology is still under appreciated in the process of developing and scaling-up innovation ·Lack of visibility of the role of the social economy sector in digital education and the digital economy Suggetions from stakeholders Improving digitalisation was also a common theme in stakeholder expert feedback. In response to the roadmap, ideas such as promoting digital social enterprises more actively and improving the digitalisation of social economy actors to better integrate most vulnerable groups in the labour market were put forward. For example, in their position paper, Catalyst 2030 stressed that social enterprises can help promote digital education, one of the key tools to empower young people for their future and for coping with rapidly changing digital innovations, to reach a more diverse range of target groups. Cooperatives Europe stressed that the digital gap should be addressed from a gender perspective. On skills, the European Observatory for Inclusive Employment and Sustainable Development Goals called on the European Commission to ensure that EU-level funds can be easily accessed to finance projects around education, training, lifelong learning, skills development and traineeship-to-employment programmes, in order to equip workers with disabilities with knowledge and competences that match the demand for green, digital and in-sourcing skills. The Mannheim Declaration highlighted the important role of skills, calling on the European Commission to “(…) support the upskilling of social economy workers in areas such as digitalisation, participatory governance and the green transition.” Commission analysis Supporting social economy organisations in their digitalisation efforts is one area for further capacity building and mutual learning. Facilitating the creation of social economy tech start-ups and connecting social economy organisations with relevant support structures for digitalisation seem to be actions worth pursuing. 4.14 Maximising the contribution of the social economy to the European Green Deal and circular economy Main problems / challenges as perceived by stakeholders and experts ·Lack of visibility of the role and potential of the social economy model in the green transition ·Lack of convergence between green and social objectives ·Lack of equal footing of environmental, social and employment sectors when setting ambitious EU level targets for the circular economy ·The social economy is not mainstreamed within circular policies ·Lack of investment in capacity-building of social economy organisations and public authorities in the green context

Suggestions from stakeholders Throughout the consultation process, stakeholders and experts have highlighted the importance of the social economy for the green transition. In response to the roadmap, RREUSE made a number of suggestions in support of the circular economy. For example, RREUSE called for the development of flexible labour market integration policies to match evolving circular business models. Along these lines, several stakeholders called on the European Commission to consider setting social and employment objectives within circular economy related policies and to create a clear link between the action plan for the social economy and the Circular Economy Initiatives. During the Road to Mannheim events, several speakers emphasised the relevance of consumer cooperatives, and other social economy forms, in achieving sustainability and transitioning to a circular economy. This point was also highlighted at the European Social Economy Summit. In response to the roadmap, the WWF European Policy Office stressed the role of the social economy in fulfilling the SDGs, the European Green Deal and in addressing climate change. Commission analysis Helping social economy organisations adopt greener and climate friendly practices and integrate environmental goals in their work can be supported with capacity building. In the circular economy, partnerships between social enterprises and mainstream businesses may be a promising approach to boost the development of Local Green Deals or green citizenship actions. 4.15 Promoting entrepreneurial skills and capacity building The capacity to self-organise as well as research, education and skills development were among the opportunities and challenges indentified in the 2020 mapping study. Main problems / challenges as perceived by stakeholders and experts ·Lack of initiatives aiming to develop social entrepreneurs’ managerial and digital skills ·Entrepreneurial culture is not sufficiently promoted across the EU ·Lack of incentives, support and mentoring beyond the start-up phase hinders self-entrepreneurship and, in particular, female entrepreneurship ·Aspiring social entrepreneurs continue to be impacted by gender stereotypes and unequal care responsibilities Suggestions from stakeholders Focusing on social entrepreneurship, several speakers at the European Social Economy Summit emphasised the need to develop entrepreneurial skills and mindsets through education. At the Summit, as well as in other conferences and events, speakers suggested that courses on social entrepreneurship be included in school curriculums. In response to the roadmap, several speakers expressed the view that female entrepreneurship should be encouraged and supported. In their position paper, the Walloon Region called on the European Commission to encourage a gendered approach in public policies pertaining to the social economy by supporting female entrepreneurship through bolstering the skills, financial resources and networks of female entrepreneurs and supporting the employment of female workers within integration enterprises. Along these lines, Cooperatives Europe stressed that female entrepreneurs should be supported through the provision of effective follow-up and support on access to capital and credit. Similar points were raised at the Social Economy Summit, where speakers emphasised the challenges faced by women entrepreneurs, including the impact of different maternity leave opportunities and unequal care responsibilities. Experts suggested lifelong learning and flexible working arrangements as strategies to facilitate balancing career and care responsibilities for women entrepreneurs. (See also section 2.4 on the gender dimension). Commission analysis Promoting entrepreneurial skills could be another building block in capacity-building measures. This may lend itself particularly well to peer-to-peer learning. Existing social economy networks could be used to foster and exchange good practices on entrepreneurial skills in the social economy context. The promotion of synergies between the EU funding programmes devoted to lifelong learning and job creation may further contribute to this objective and to maximise the existing investments. 4.16 Implementation of the action plan for the social economy Main problems / challenges as perceived by stakeholders and experts ·The action plan for the social economy must be fully integrated with other EU initiatives and programmes (i.e.: EU Green Deal, European Pillar of Social Rights, Disability Strategy, Skills Agenda, Platform Work Initiative, SME Strategy, Industrial Strategy) ·The implementation of the action plan should be assessed on a yearly basis · Suggestions from stakeholders Throughout the consultation process, several stakeholders (among them Social Services Europe) called for a participatory approach to policy design and implementation and indicated their availability for co-creation processes. This was also underlined in the Mannheim Declaration: "The preparation of public policy making should be carried out in close cooperation with social economy actors for greater policy coherence and greater effectiveness". In response to the roadmap, several stakeholders called for the action plan to be renewed every 5-6 years. This point was also made in the European social partners‘ consultation. In addition, some stakeholders called for the implementation of the action plan to be assessed on an annual basis by the GECES. A few stakeholders suggested that the GECES be strengthened and renewed at the end of its mandate in 2024. In addition, several stakeholders, in response to the roadmap, called for the action plan to be fully connected with other EU initiatives and programmes such as the European Pillar of Social Rights, the EU Green Deal and the Skills Agenda. Looking beyond EU initiatives, WWF European Policy Office and Eurodiaconia stressed that the action plan should be aligned with the Sustainable Development Goals (SDGs).

The need for the social economy to complement public support, rather than replace it, was also raised by some stakeholders in response to the roadmap and by trade union representatives at the European social partners’ consultation. This message was echoed by the Mannheim declaration which stressed that “the social economy should complement public approach in tackling societal challenges but not replace it.” Commission analysis To succeed with implementation, the Commission will need to work in close partnership with social economy actors, other EU institutions and bodies, the European Investment Bank Group, Member States, regions, industry, network organisations and other key stakeholders. Ensuring their support and buy-in will be key.



5.EU Budget to support social economy 2021-2027 EU budget to support and unlock investment in the social economy and social innovation during 2021-2027 During 2014-2020, the EU budget mobilised directly at least EUR 2.5 billion for the social economy and other related topics (e.g. microfinance, social innovation, inclusive entrepreneurship). Thanks to the multiplier effect of the financial instruments for microfinance and social enterprise, at least EUR 7.9 billion were mobilised from EU, national and private resources. Cohesion policy funds can be used to promote the social economy, including through support to social entrepreneurship, social innovation, education and training, experimentation and innovation in SMEs. Several Cohesion policy programmes support business development and promotion of cooperation for the social economy. For example: ·The European Social Fund Plus (ESF+), which allocates a budget of EUR 99.3 billion, will remain an important funding source for promoting the social economy and social innovation. Social economy organisations will be well placed to benefit from ESF+ support, because their activities can help to achieve the ESF+ specific objectives, notably the objective of enhancing the inclusiveness of labour markets and access to quality employment. National and regional authorities can use grants as well as financial instruments to build social economy ecosystems. ·At the EU level, the Commission can support transnational cooperation specifically with a view to accelerating the scaling up of social innovation. ·The European Regional Development Fund (ERDF) can provide support for the development and upscaling of social enterprises through developing new business models and innovative solutions to address societal challenges. The support can take the shape of: business advice and guidance (business planning, coaching and mentoring, support with marketing); start-up centres and incubators; innovation activities to develop new products, services or ways of working; awareness raising, workshops, awards. In addition, ERDF-funded financial instruments can be used to provide risk capital to start-ups. Finally, ERDF makes available tools and measures to help mutual learning between different countries and regions in Europe. ·Specifically for the culture and tourism sectors, which suffered disproportionately from the COVID pandemic, the ERDF can support funding towards strengthening these sectors’ capacity to drive economic development, social inclusion and social innovation, given the role that these sectors play in addressing socio-economic challenges at the local, regional, national and cross-border level. ·The new European Urban Initiative will provide space and resources for EU-wide urban experimentation to test suitability, feasibility and acceptance of social change and will support cities that can demonstrate their potential for social innovation and transformation. ·The Interreg Europe Programme will continue to provide opportunities for regional and local public authorities across Europe to share ideas and experience on support to the social economy. The Employment and Social Innovation strand under the ESF+, with a budget of EUR 762 million, will provide EU level support for the development of social enterprises, the emergence of a social investment market, and the development of the market ecosystem around the provision of microfinance. It will also support social experimentation and guidance for the development of social infrastructure. The strand will complement the financial instruments funded under the Social Investments and Skills window of InvestEU through analytical activities, capacity building and mutual learning. The Social Investments and Skills window of InvestEU will use part of its EUR 2.78 billion of guarantee to support the deployment of financial products providing repayable finance for social enterprises, irrespective of their legal form, and to microenterprises. These products will help mobilise private financing and are expected to have a multiplier effect of around 10. While most instruments for social enterprises will address small risk capital investments and debt of up to EUR 500 000, larger amounts of up to EUR 2 million will also be possible, to cater to the larger scaling needs of some organisations. Moreover, the financial products will be complemented by advisory initiatives in the fields of social enterprise finance, microfinance, impact investing and social outcomes contracting. Other InvestEU windows will also offer opportunities for social economy entities. Notably, as most social economy entities are SMEs, they will be able to benefit from support under the SME window. For example, initiatives such as worker buyouts are increasingly common among SMEs and social economy entities and will be able to benefit from support under these windows. The Horizon Europe programme can contribute to research on the social economy in the context of inclusive growth and other policy targets of the European Union. For instance, the 2021-2022 Work Programme on Culture, Creativity and Inclusive Society includes several references to the social economy and social enterprises. Furthermore, support to social innovation is mainstreamed through all the strands of the programme. The new feature of Horizon Europe are “missions”, i.e., commitments to solve some of the challenges we are facing today: fighting cancer, adapting to climate change, protecting the ocean, seas and waters, living in greener cities and ensuring healthy soil and food. Alongside research and innovation projects, the missions include policy measures and legislative initiatives, as well as citizens' involvement to achieve concrete goals with large societal impact, with a budget of EUR 1.9 billion over 2021-2023. The 2021-2027 Erasmus+ programme can contribute to developing entrepreneurial skills and fund actions with relevance for the social economy. For example, it can support transnational cooperation partnerships including those aiming to promote social entrepreneurship skills. The new action “Alliances for Innovation” aims to foster social innovation and tackle societal challenges through cooperation between higher education institutes, vocational education and training providers, enterprises and other relevant stakeholders. Erasmus+ can also fund strategic activities supporting policy experimentation and reform, including the promotion of social entrepreneurship skills. The new European Solidarity Corps programme can fund projects with relevance to the social economy. For example, it can contribute to developing entrepreneurial skills through solidarity projects that are bottom-up activities set up and carried out by a group of young people themselves. The Recovery and Resilience Facility, with EUR 732.8 billion in grants and loans, provides Member States with significant opportunities to fund reforms and investments in social and inclusive entrepreneurship. Some Member States have reflected the social economy and inclusive entrepreneurship as priorities in their national recovery and resilience plans. The Commission will monitor and support Member states in the implementation of their respective plans. It will also systematically highlight the potential of the social economy to create jobs and foster social cohesion in the context of the European Semester process. The LIFE Programme will fund initiatives that address both environmental/climate and social aspects, demonstrating the links between social and environmental problems. For example, the programme will encourage investment and activities focusing on energy efficiency and small-scale renewables such as those promoted by energy cooperatives. It also aims to facilitate the transition to a circular economy, a field of activity where many social enterprises are active. The second pillar of the Common Agricultural Policy, the European Agriculture Fund for Rural Development, enables measures that can contribute to the development of social economy in rural area such as investment for farmers and in basic services, diversification and cooperation and the local development method LEADER. The social economy will also be a good partner for achieving the objectives of the new Common Agricultural Policy, which starts in 2023. It can notably support the objective of modernising the agricultural sector by attracting young people and improving their business development, and promoting employment, growth, social inclusion and local development in rural areas. The Single Market Programme will strengthen the governance of the EU single market. It will help to: make the internal market work better, through measures including improved market surveillance, problem-solving support to citizens and business, and enhanced competition policy; boost the competitiveness of businesses, in particular of small and medium-sized enterprises, including social economy organisations and social enterprises; develop effective European standards and international financial and non-financial reporting and auditing standards; give even higher protection to consumers; maintain a high level of food safety; and produce and disseminate high-quality statistics. The Digital Europe Programme (DIGITAL) will focus on bringing digital technology to businesses, citizens and public administrations. It aims to accelerate the economic recovery and shape the digital transformation of Europe’s society and economy, bringing benefits to everyone, but in particular to small and medium-sized enterprises. DIGITAL will provide strategic funding in five key capacity areas: su