Social Enterprises Code
Complying with the Social Enterprises Code [Code Sociale Ondernemingen] is the most effective way for social enterprises in the Netherlands to show what they stand for, namely 'Impact First'. Registering one’s company in the Register of Social Enterprises ensures recognition and promotes a reliable and professional image. PwC is closely involved with the Code. Over the past year, Fatima el Baouchi and Sander Primavera have been members of the PwC team that helped the Code organisation draw up its GDPR policy and select a CRM system. They say they became incredibly enthusiastic about that work. Marijt Regts, Operations Manager for the Code, explains how important PwC’s support has been: “It’s far better to get things right the first time than having to repair and alter everything a few years down the road.”
Sander Primavera and Marijt Regts
What distinguishes a social enterprise from an ordinary company?
“A social enterprise", says Marijt Regts, “aims to achieve social impact through everything it does. It doesn’t matter whether it’s sustainability, improving opportunities for certain vulnerable groups on the labour market, or setting up a fair and transparent trading chain: creating impact is paramount. A social enterprise has implemented that approach right across the board, in its financial policy, in how it deals with stakeholders… in fact in everything. For a social enterprise the motto is Impact First.”
What’s the position of social enterprises within the Dutch economy?
Regts: “Seven or so years ago, social entrepreneurship was still a new concept in the Netherlands. The enterprises existed already, but they didn’t yet know it. In recent years, the sector has grown enormously, not only as regards the number of enterprises; understanding of social entrepreneurship has also increased enormously. According to recent studies, there are currently some five to eight thousand social enterprises in this country. The sector is now embarking on professionalisation. That applies not only to the enterprises themselves but also to all the stakeholders involved with them. If we can define and objectify what a social enterprise actually is, it’ll be easier to link up with public authorities, corporates, purchasers, financiers, knowledge institutions, and so forth.”
Why was the Social Enterprises Code drawn up?
Regts: “The Code addresses the need for professionalisation and objectification. On the one hand, there’s a great need for those on the part of the enterprises themselves. Social entrepreneurship isn’t a protected term. But it’s about much more than just doing something good; it’s about making your whole business focus on your impact objective. As a social entrepreneur you’re often swimming hard against the current, and that deserves recognition. On the other hand, stakeholders also need an unambiguous definition of the term. It’ll put them in a position to pursue policy in this area. Some sixty municipalities, for example, mainly in the east of the Netherlands, have included the Code in their social return policy, which is an enormously positive development. And a party like PwC may also decide to meet a certain percentage of its sustainable procurement targets by buying from enterprises that are listed in our Register. Financiers too know that such enterprises have already undergone the requisite due diligence and have been thoroughly tested on a number of matters; that in turn encourages links.”
What does certification according to the Code actually achieve for social enterprises?
Regts: “I’ve already mentioned the example of the sixty municipalities, which shows how the Code increases market opportunities for social enterprises. That now needs to happen much more broadly. We’re already hearing from registered enterprises that they’re more often invited to consultative discussions, for example regarding the award of contracts. Clients know exactly who they’re dealing with, namely enterprises that are distinctive and that have undergone some serious checks. Moreover, the Code represents development: once you’re in our Register, you don’t just mark time on the spot. You’re challenged by your peers: where do you stand now and how do you intend continuing to develop as a social enterprise? The Code is also a source of inspiration for new entrepreneurs who want to make an impact and who ask themselves what’s involved and how they can best organise themselves so as to participate.”
What about your own growth objectives?
Regts: “We actually got started at the beginning of 2019 and so far 25 enterprises have been registered, with about 130 enterprises currently in the pipeline, at different stages of the registration process. We’re optimistic that we’ll achieve our goal of having a hundred registered enterprises by the end of 2020. In five years’ time, we want to have a thousand social enterprises in our register. That’s our BHAG – our Big Hairy Audacious Goal!”
"For us, it was important to come up with a CRM solution that would suit a small organisation, but that would make strong growth possible."
What prompted you to call in PwC at this stage?
Regts: “PwC has been involved with the Code since the very beginning. The specific reason why we called them in was to help us draw up our GDPR policy and select a CRM system. We’re a young organisation in which professionalism is a top priority. And we also need to be able to grow rapidly. It’s far better to get things right the first time than having to repair and alter everything a few years down the road. It’s been very beneficial for us to think hard about issues that we hadn’t yet thought of ourselves. That’s helped us set up various processes properly and to work efficiently.”
What have you and PwC cooperated on and what’s been achieved?
Regts: “Every organisation, large or small, has to be GDPR-proof. We ask enterprises for so much information that we have to be able to show that we’re a reliable partner in that regard. Where privacy is concerned, everything has to be super-strictly organised; we can’t afford there to be any incidents. After an extensive introduction, PwC conducted a series of in-depth interviews with our team and carried out a scan of our organisation, systems, processes, governance, contracts, and so forth. All that clarified our current maturity level and showed up where there were still gaps in our knowledge of the GDPR. Subsequent to that analysis, PwC helped us draw up the documentation for our internal and external privacy policy, and a roadmap was drawn up that matched our objectives and ambition. Further elaboration and application of that policy is now up to us. When selecting a CRM system, we followed a similar process, ending up with three possible systems suitable for an organisation like ours; we have implemented one of them."
Sander Primavera (PwC) notes: “For us – and here we have to mention Bram ter Stege, who did by far the most work – it was important to come up with a CRM solution that would suit a small organisation, but that would make strong growth possible. We considered the ‘personas’, i.e. the archetypal users who will soon be working with the system. That helps ensure that digitisation or IT solutions actually support the work and deliver added value. We drew up a ‘schedule of requirements’ and made an initial selection of suitable CRM packages that are available on the market.”
What lessons have you learned from working for the Code that you can apply in future assignments with other clients?
Fatima el Baouchi (PwC): “We carry out both these kinds of assignment for a lot of different organisations. In the case of the Code, it was very important to keep in mind that this is an organisation that aims to grow considerably but as yet is still small. That’s why we’ve been in constant touch with one another other about things like ‘how do we make this practical and manageable for you?’ and ‘how can we make sure it’ll remain applicable in the future?’. Anyone can look up what’s in the GDPR, but do they really understand what it means for their actual work? The nice thing about this collaboration is that the lines of communication are very short; I really appreciated how valuable that is. If you have a question, you don’t hide behind an e-mail – you pick up the phone straight away, have a quick talk with the right person, and get on with the work. That’s sometimes a relief, and it speeds up progress enormously. In the future, I want to make use of short lines of communication even more than I already did; I’m convinced that that’s also possible in larger organisations.”
Primavera: “I agree with Fatima. Professionally too, it was a very enjoyable assignment. The processes are relatively simple, so you’re right on top of the actual implementation. In bigger organisations, there’s a risk of getting lost in the complexity of things, and there’s always ‘yet another department’ that you first need to visit. In our work for the Code, we could see very specifically what we were doing, and it was crystal clear what we were doing it all for. That’s one reason why every PwC staff member finds working on this kind of assignment really enjoyable, and some of them can get wildly enthusiastic about it.”
Regts: “I think PwC has always been entirely clear about who we actually are. We had hardly a clue about the GDPR, for example, and working with PwC really clarified things for us. For us, GDPR policy has become very tangible; we understand why and how we need to set up various things and we can get down to working on them. That helps us with our own growth and professionalisation.”
Marijt Regts and Sander Primavera
The five principles of the Social Enterprises Code
The Social Enterprises Code is principle-based: responsibility for implementation lies with the social enterprise itself. That gives the enterprise scope for enabling practical implementation of the principles to increase along with the enterprise. But that doesn’t alter the fact that a number of essential requirements and admission criteria need to be met.
Principle I. Mission: Guaranteed and Measurable
The social enterprise lays down its social mission in its Articles of Association, defines its goals, and makes clear how it will achieve those goals.
Principle 2. Stakeholders: Decision and Dialogue
The social enterprise determines who the relevant stakeholders are in the light of its mission and enters into constant dialogue with those stakeholders.
Principle 3. Finance: In Consultation and Carefully Considered
Monetary profit is not the main goal of a social enterprise. The enterprise has a financial policy (enshrined in its Articles of Association) that clearly indicates that its mission is paramount, for example by imposing restrictions on distributions to the shareholder(s).
Principle 4. Implementation: Registration and Reflection
The enterprise registers in the Register of Social Enterprises and is then prepared to participate actively in that community of enterprises.
Principle 5. Transparency: Active and Accessible
The enterprise pursues an active information policy based on maximum openness.
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