Social Enterprise and Socio-Legal Structure: Constructing Alternative Institutional Spaces for Economic Development

Article:

Lionais, D (2010) “Social enterprise and socio-legal structure: constructing alternative institutional spaces for economic development”

Summary:

In this article, Lionais examines the viability of place-based business as an alternative to social enterprise within the context of supporting the social economy. He argues that increasingly, social enterprises in particular are now “expected” to be self-sufficient as well as achieve their social objectives, which has become problematic. The alternative of place-based business, Lionais argues, mitigates a number of the conceptualisations associated social enterprise while still providing a number of the same benefits.

Lionais provides two case studies in his paper; Mondragon Cooperative Corporation from Spain and New Dawn Enterprises from Nova Scotia Canada. These firms are both inextricably linked to the place in which they operate and Lonais uses this commitment to their community as a basis for place-based businesses as an alternative to social enterprise. However, the link is not due to some perceived economic advantage or business decision; it is due to their commitment to the place in which they choose to do business. Linonais argues that due to the approach in being a place-based business as opposed to a social enterprise, these organizations have the latitude and flexibility necessary to meaningfully engage in both the market-based circuits of capital as well as the community benefiting from the company’s attachment too its place.

Lionais goes on to examine the two different organizations and puts a particular emphasis on the differences in approach to labour. Mondragon operates under a co-operative model in which members and employees can be seen much like shareholders of the corporation. New Dawn employs a more traditional “exploitative” approach to labour for their business. Although the businesses differ in this approach, the “surplus” or “profit from the business is still meant to serve the community, which is the social benefit of these types of organizations.

Bullets:

• Alternative approaches to local economic development are increasingly being employed as regeneration strategies for depleted communities
• Social enterprises are problematic in that they are expected to fill a social need as well as become self-sufficient
• Are place-based businesses a viable alternative to social enterprise?
• Capital or surplus is meant to ”serve” the place (i.e., community) in which they are located.
• Despite differences in approaches to labour structure (Co-Op vs Exploitative), these organizations fit the definition of a place-based business
• Social purposes can still be entwined with mainstream capitalism in different forms without being labelled a “social enterprise”

Reflection:

I really enjoy the writing of Lionais. This article was very interesting to think about and reflect in regards to the language we use to communicate the benefits and need for the social economy. I have often thought that the language becomes very problematic when speaking about how we integrate society’s values or “the social” into business or “the economy”. At present, more often than not, the two seem to be mutually exclusive. With the context provided in this article, I may be able to better articulate and communicate the options available in regards to promoting the social economy within Whitehorse.