Nearly one million people are now employed in the sector that aims to use the power of business and enterprise as a force for good, with over 70,000 businesses contributing more than £24 billion to the UK economy.

The biennial State of Social Enterprise Survey also reveals how the concept of doing business differently is outperforming traditional SMEs in areas of diversity, start-up rates, innovation and pay.

The report – commissioned by Social Enterprise UK and supported by Santander UK – is the most rigorous and representative of its kind and gives an insight into how traditional companies are increasingly attracted to new ways of doing business.

Speaking as the report’s findings were made, chair of Social Enterprise UK Lord Victor Adebowale, says, ‘Social enterprises show us what the future of business can look like.

‘These are credible businesses, competing in the open market but set up in a way that addresses some of the biggest issues we face. From homelessness and substance abuse to mental health and social care – social enterprises are working on the front-line creating opportunities and reducing inequalities.

‘They are showing traditional businesses how social impact and profit can go hand in hand. If we’re to meet the challenges and uncertainties of the coming years, we should look to the social enterprise model for inspiration and guidance on how we can create an economy that works for everyone.’

Sue Douthwaite, managing director of Santander Business Banking says, ‘We are once again proud to support the State of Social Enterprise Report. It shows the important contribution social enterprises are making to society and the increasingly vital role they play in building more resilient communities and a fairer economy. It’s never been more important to support and invest in these businesses which are creating jobs, opening up opportunities and building a more prosperous future for us all.’

Key findings:

– UK social enterprises are outperforming mainstream businesses in growth and innovation

– They are leading the way on diversity with 41 per cent being led by women

– 25 per cent of social enterprises are under three years old

How social enterprises stack up:

The findings reveal that social enterprises, businesses which trade to meet a social or environmental mission, are demonstrating how social purpose can meet profitability outperforming mainstream SMEs in growth, innovation and start-up rates.

– 47 per cent grew their turnover in the last year compared with 34 per cent of SMEs and 50 per cent introduced a new product or service in the last twelve months. This figure has fallen to 33 per cent amongst traditional SMEs.

– 25 per cent of social enterprises are also under three years old, showing that more than ever businesses are being set up explicitly to meet social or environmental challenges.

Leading the way on diversity:

Through how they operate, where they work and who they employ social enterprises are showing how another way of doing business is possible, one that is inclusive by nature and set up to tackle inequalities.

– 41 per cent of social enterprises are led by women with 51 per cent having a majority female workforce (mainstream SMEs have 20 per cent women leadership).

– 34 per cent have BAME directors and 36 per cent have a director with a disability – showing a sector more representative of society at large.

– More than two thirds are supporting people from disadvantaged groups (69 per cent) and four in ten are employing them. Many are also driving growth at a local level with 79 per cent of social enterprises recruiting over half their staff locally.

Leading the way on pay:

They are also paying fairly with 78 per cent reporting paying the higher Living Wage as established by the Living Wage foundation.

– Average pay ratios for the sector stand at 2.7:1 compared to 129:1 at FTSE 100 companies.

Further reading on social enterprise

Does your business turn over between £50,000 and £500,000? If so, you are eligible for the new Small Business Grants initiative from We’re giving away £5,000 every month in a free-to-enter competition. Apply now by clicking here. Good luck!

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