The Ontario Nonprofit Network (“ONN”) made a written submission to the Social Enterprise Branch of the Ministry of Economic Development, Employment and Infrastructure on December 1, 2015, (the “Submission”) proposing that that the Branch ensures a “real focus on nonprofit social enterprise” in the development of social enterprises in Ontario, notwithstanding that the for-profit model for social enterprise may currently be better understood. The Submission by ONN is directed at the Ontario government’s recent initiative to facilitate the growth and success of social enterprises in Ontario. For more information about the government initiative, see Impact: A Social Enterprise Strategy for Ontario.
The Submission encourages a “principled approach” that recognizes that social enterprises, whatever their corporate form, must exist “to provide public benefit, contribute to and grow community wealth and wellbeing.” In consultation with its network of 55,000 not-for-profits and charities in Ontario, ONN developed six key policy recommendations which are set out below along with a brief summary of accompanying commentary where appropriate:
- “Approaches to social enterprise development must maintain a clear focus and clarity of purpose and principle” In this regard, ONN submits that social enterprise development must maintain commitment to the public good and operate with a holistic approach. This could be facilitated if social enterprises received funding similar to that received by other application of social enterprise, such as for-profit or dual-purpose enterprises.
- “The Government of Ontario should focus on improving access to appropriate capital investment for social enterprise.” The government should recognize that social enterprises require access to a wide variety of capital and improve accessibility accordingly.
- “The Government should develop a Social Procurement Action Plan.” Targeted social procurement could help provide economic opportunities for social enterprises.
- “A provincial approach means including regional approaches.” The government need to focus on social enterprise initiatives in rural and remote contexts, as well as in urban contexts.
- “The government of Ontario should move forward with enabling amendments to legislation and regulation for the 88% of social enterprises operating as non-share capital organizations, so they may earn income to grow their enterprises, attract capital, and increase sustainability while maintaining the public’s trust.”
- “Modifications to the Ontario Business Corporations Act to provide for dual purpose ‘private profit and social good’ corporations should not be undertaken at this time.” ONN’s background research indicates that dual purpose corporations do not adequately address the needs of social entrepreneurs, communities, investors or governments. For more information concerning the possibility of dual purpose corporations in Ontario, see Dual Purpose Corporate Structure Legislation: Stakeholder Engagement Report, which was released by the Ontario Ministry of Government and Consumer Services on January 29, 2015.
For more information on the submission by ONN, please see the ONN’s Policy Blueprint for Social Enterprise.