Toby Johnson
12 September 2014

What should social enterprises expect from the new Commission?

New Commission organigram

The new European Commission portfolios announced by Jean-Claude Juncker on 10th September augur well for a policy supportive of social enterprise, and a continuation of the Social Business Initiative. A renewed SBI should follow SEN’s lead by promoting best practice in Member State policy.
The Commission’s new set-up offers several pointers to a good wind for social enterprise.
Firstly, the way it works is being changed. To allow it to be “bigger and more ambitious on big things, and smaller and more modest on small things” the five vice-presidents will each be in charge of a ‘project team’ that will co-ordinate the work of the relevant DGs. This ought to spell policy-making that is better joined up in such an interdisciplinary field as social enterprise. In our case the relevant project team is called ‘A New Boost for Jobs, Growth and Investment’ and is led by ex-Finnish centre-right prime minister Jyrki Katainen, Vice-President for Jobs, Growth, Investment and Competiveness.
Secondly, there is a new integrated portfolio for the Internal Market, Industry, Entrepreneur­ship and SMEs, which will include the social economy. The job has been given to the Polish commissioner, Elżbieta Bieńkowska, who until last year was minister for regional develop­ment. Poland has used the Structural Funds to very good effect so far (and is of course the leader of SEN) so we can hope that this experience has shown her what social enterprises can offer.
She will take command of a new DG formed from the merger of Enterprise with much of Internal Market, while the financial services part of MARKT goes to the British commissioner, Jonathan Hill. Thus, two of the DGs running the Social Business Initiative are brought together. Echoing ex-internal market commissioner Michel Barnier’s words when describing his desire to give the banking sector a new role, the Commission describes the new portfolio as “the engine house of the real economy” and notes that SMEs are mentioned explicitly for the first time. There’s no such luck for social enterprises, although Jean-Claude Juncker, in his Political Guidelines for the next European Commission, expresses his strong belief in a fairer and more inclusive ‘social market economy’ which does not leave pensioners in poverty while speculators enrich themselves. Despite this commitment, the growth and jobs agenda he sets out promises more of the same: entrepreneurship, deregulation, skills, new technologies, access to markets and finance – particularly for SMEs. As well as two specific priorities – building a digital single market and making Europe the world leader in energy efficiency – he wants to use EU funds better, to yield “smarter investment, more focus, less regulation and more flexibility.”
The link that social enterprises make between entrepreneurship, jobs and inclusion seems to have been forgotten, but its track record should ensure that it finds a place.
We may also expect a good understanding of the social economy from the fourth key person, the new commissioner for Employment and Social Affairs, Skills and Labour Mobility, Marianne Thyssen. She comes from Flanders (she is an ex-president of the CD&V party and has served for the last 23 years as an MEP) which is a region with a strong policy of support for the social economy. EMPL takes over skills and vocational training from EAC, as well as disability and employment from Justice. Not everything is streamlined though, as in the organisational shuffle responsibility for Corporate Governance and Social Responsibility (MARKT F2), moves to the Justice DG.

A renewed Social Business Initiative
Over the last three years, the SBI has achieved several useful things:

  • established a round table at which the sector can express itself, in the form of the GECES advisory group (new members will be chosen next spring)
  • drawn up guidelines for social impact reporting
  • mapped the sector (the 29-country study is very nearly finished)
  • created the regulation for social enterprise investment fund (the first EuSEF, Munich-based BonVenture Management GmbH, has just been registered)
  • set up an €85m investment fund as part of EaSI

There have also been favourable developments in the Structural Funds, public procurement, social innovation and crowdfunding.
Above all it has raised the profile and coherence of social enterprises among a wide range of stakeholders, notably through the Strasbourg event last January.
This is a good start, but clearly the work must continue.
At present, in the hiatus between Commission mandates, debate on the nature and principles that should be promoted continues under the aegis of the European Economic and Social Committee (EESC). How prominent should the social economy’s participative and democratic principles be, and how many concessions should be made to the demands of private capital? EU policy has the difficult job of remaining inclusive of the various strands of thought, and making a whole that is greater than the sum of its parts.
Meanwhile, as social enterprises continue to show their effectiveness (particularly in the current economic crisis), Member State policies are developing and converging. Several countries are bringing forward legislation on social enterprise, some with a more liberal flavour (Denmark) and other with a more conservative tinge (Portugal). Structural Fund operational programmes are being adopted, and the option of community-led local development (CLLD) programmes is there for them to use.
The bulk of the work in developing the potential of social enterprises to create employment, inclusion and social innovation can only be done at the national and regional level – and this why SEN is so important. It is enabling governments to learn from each other about what sort of policies work best, and it is also enabling them to build working partnerships with social enterprise organisations.
On the broader scale, a renewed SBI should move forward from the regulatory groundwork, and pay more attention to promoting best practice in the Member States. The mapping study, to be published in the autumn, will give stakeholders plenty of material to work on.
The key role the Commission should play is to make policy coherent and joined-up – it has been crucial in holding the overview and in progress-chasing the priority actions. For this a dedicated unit in the Commission services with high-calibre staff is indispensable. The new organisation of the Commission should make this possible – if the political will is there.
Toby Johnson
Detailed list of the commissioners’ responsibilities and regrouping of units:
Detail on policy teams:
A New Start for Europe: My Agenda for Jobs, Growth, Fairness and Democratic Change: Political Guidelines for the next European Commission