Business purpose and the role of social enterprise 

Posted: 12 July 2022, in Blog

A recent landmark report aims to transform the conversation about the social purpose of all businesses in Scotland.

Now is the time for purpose, from the Business Purpose Commission for Scotland and supported by SCDI and the Scottish Government, states the urgency of embedding social and environmental value at the heart of all enterprises. 

The vision in the report is that “By 2030, all businesses in Scotland will have become purposeful businesses which profit from finding solutions for people and planet.” 

This, of course, will resonate strongly with the pioneers of social and environmental value who lead our social enterprise community. Social entrepreneurs build business purpose as the very core of their mission. 

According to the report: “The purpose of a business is why it exists, is created, and its reason for being. It is fundamental to every business and should drive its core strategy and activities…what the report demonstrates is the need to look beyond bottom-line financial returns to shareholders to impacts on societies and environments in which business operates.” 

Crucially some of this is being driven by public pressure and not just businesses themselves seeking to change: “Scottish citizens are looking to business to play a still stronger part in promoting employee, societal and environmental wellbeing.” 

There’s evidence in the report that purposeful businesses are more profitable businesses. The report also says that young people are increasingly looking to work in and buy from purposeful businesses: 

“The most popular actions to increase peoples’ trust were paying the real living wage as a minimum (52%), paying fair levels of tax (38%), providing job security for employees (32%), and making a clear commitment to customer services (30%).” 

There’s a lot of support in the report for the role of social enterprises and the third sector: 

“Voluntary organisations and social enterprises are experts at purpose. The sector has a reach which stretches from countries around the world to deep within all communities in Scotland. Businesses can learn about purpose from voluntary organisations and social enterprise, and increase their own impact by working with them. Supporting the sector also augments local ‘institutional capital’ – the social fabric in which prosperous economies can thrive.” 

Sean Duffy, CEO of Glasgow-based social enterprise The Wise Group was a member of the Commission steering group:  

“At the Wise Group we have put purpose at the heart of our enterprise. We’ve doubled down on our colleague wellbeing, providing twice-weekly mental health sessions, a remote first flexible working model and support in the face of the cost of living crisis. Similarly, we support thousands into sustainable employment every year. Ultimately, we’ve found that people’s location and connection with their job, not processes, drives productivity. Placing genuine and committed values at the heart of your business is not altruistic, not a hindrance, but a help.” 

There’s a huge amount of value in all private sector businesses building enduring relationships with social enterprises, for mutual benefit. 

The report states: “Our call to all businesses in Scotland is to act now to develop and nurture your business purpose. Leaders who embed a clear purpose in their business will help to steer it through economic challenges to seize the business opportunities from solving problems for people and our planet.” 

At Social Enterprise Scotland we look forward to working even more closely with friends and allies in the private sector, SMEs, as well as big companies wanting to improve our society and planet.  

The new report could be a catalyst for much needed social and environmental change. Social enterprises can take the lead and help embed social purpose in every business. 

Duncan Thorp, Policy and Public Affairs Manager, Social Enterprise Scotland