Social enterprises in the EU

Preface V
Acknowledgement VII
List of acronyms XI
List of tables XIII
List of figures and charts XV

Chapter 1. General introduction 1
1.1 Aims of the doctoral thesis 1
1.2 Main concepts 3
1.2.1 The social enterprise concept 3
1.2.2 Tailor-made legal forms for social enterprises 8
1.2.3 Stakeholder participation in the governance of social enterprises 12
1.3 The research question 16
1.4 Methodology and validity issues 16
1.4.1 The employed methodology in this doctoral thesis 16
1.4.1.1 Comparative legal research 16
1.4.1.2 Comparative case study approach 16
1.4.1.3 Selection of cases 17
1.4.1.4 Meta-synthesis 18
1.4.1.5 Survey of stakeholder participation in Dutch social enterprises 19
1.4.2 Methodological considerations and validity issues 20
1.4.2.1 Methodological considerations in relation to the comparative approach 20
1.4.2.2 Methodological considerations in relation to the case studies and the meta-synthesis 22
1.4.2.3 Methodological considerations in relation to the survey 30

Chapter 2. An introduction to tailor-made legislation for social enterprises in the EU: A comparison of legal regimes in Belgium, Greece and the UK 31
2.1 Introduction: Legal frameworks for social enterprises in the EU 32
2.2 Definitions of social enterprises 37
2.3 Methodology: Legal variables pertinent to social enterprises 43
2.3.1 Introduction and reference to previous research 43
2.3.2 The background studies 43
2.3.3 Comparative legal methodology 46
2.3.4 The selection of countries 48
2.3.5 Comparison on the basis of the legal variables 49
2.4 The social purpose in the Belgian, Greek, and UK social enterprise law 49
2.4.1 The Belgian company with a social purpose (VSO) 50
2.4.2 The Greek social cooperative enterprise (Koinsep) 52
2.4.3 The Community Interest Company (CIC) in the UK 54
2.4.4 Intermediate comparative conclusions: the social purpose of social enterprises in the Belgian, Greek and UK social enterprise law 58
2.5 Participatory governance in the Belgian, Greek, and UK social enterprise law 61
2.5.1 The Belgian company with a social purpose (VSO) 62
2.5.2 The Greek social cooperative enterprise (Koinsep) 63
2.5.2.1 General meeting of the members 64
2.5.2.2 Managing committee 65
2.5.3 The Community Interest Company (CIC) in the UK 67
2.5.3.1 The annual general meeting 68
2.5.3.2 Board of directors 69
2.5.4 Intermediate comparative conclusions: the participatory governance of social enterprises in the Belgian, Greek and UK social enterprise law 71
2.6 Accountability and responsibility in the Belgian, Greek, and UK social enterprise law 73
2.6.1 The Belgian company with a social purpose (VSO) 74
2.6.2 The Greek social cooperative enterprise (Koinsep) 75
2.6.3 The Community Interest Company (CIC) in the UK 76
2.6.4 Intermediate comparative conclusions: accountability and responsibility of social enterprises in the Belgian, Greek and UK social enterprise law 78
2.7 Financial structure in the Belgian, Greek, and UK social enterprise law 79
2.7.1 The Belgian company with a social purpose (VSO) 80
2.7.1.1 Profit distribution constraint: the asset-lock scheme 80
2.7.1.2 Asset-lock on winding up 81
2.7.2 The Greek social cooperative enterprise (Koinsep) 82
2.7.2.1 Profit distribution constraint: the asset-lock scheme 82
2.7.2.2 Asset-lock on winding up 83
2.7.2.3 Financing of resources 83
2.7.3 The Community Interest Company (CIC) in the UK 84
2.7.3.1 Profit distribution constraint: the asset-lock scheme 84
2.7.3.2 Asset-lock on winding up 86
2.7.3.3 Financing of resources 87
2.7.4 Intermediate comparative conclusions: financial structure of social enterprises in the Belgian, Greek and UK social enterprise law 89
2.8 Conclusions 92
2.8.1 The points of similarity 93
2.8.2 The points of difference 94

Chapter 3. Case studies concerning the participatory governance of social enterprises in Belgium, Greece, and the UK 97
3.1 Belgium: An empirical investigation of supportive legal frameworks forsocial enterprises in Belgium: A cross-sectoral comparison of three case studies concerning social enterprises in the social housing, finance and energy sector 97
3.1.1 Introduction 98
3.1.1.1 Governance of social enterprises 98
3.1.1.2 The legal factor of governance in tailor-made legislation for social enterprises 102
3.1.1.3 The necessity for empirical research in the governance of social enterprises 103
3.1.1.4 The Belgian vennootschap met sociaal oogmerk (VSO) legal label 105
3.1.2 Method 107
3.1.2.1 A case study approach 107
3.1.2.2 Respondents 108
3.1.2.3 Procedure and analysis 109
3.1.3 The case study results 113
3.1.3.1 Cooperatives with a social purpose (VSO label) in the renewable energy, financial and housing sector 113
3.1.3.2 Cooperatives with a social purpose in the renewable energy sector – Cooperative Enterprise in Rational Energy (CORE) 114
3.1.3.3 Cooperatives with a social purpose in the financial sector – Microstart 117
3.1.3.4 Cooperatives with a social purpose in the social housing sector – Volkshuisvesting 119
3.1.4 Discussion 123
3.1.4.1 Participatory governance 123
3.1.4.2 Employee participation in decision-making processes 125
3.1.4.3 Other types of stakeholder participation in decision-making processes 126
3.1.4.4 Incentives for formal versus informal participation of employees and stakeholders 131
3.1.5 Case study conclusions 135
3.1.5.1 Limitations, practical implications and future research 135
3.2 Greece: Unravelling the participation of stakeholders in the governance models of social enterprises in Greece 136
3.2.1 Introduction 137
3.2.1.1 Participatory governance for social enterprises 137
3.2.1.2 Participatory governance as a legal concept: the conceptual framework 139
3.2.1.3 The concept of stakeholder participation in Greek legislation regarding social enterprises 141
3.2.2 Method 147
3.2.2.1 Case study approach 147
3.2.2.2 Respondents 148
3.2.2.3 Procedure and Analysis 148
3.2.3 The case study results 151
3.2.3.1 Koinsep Merimna Ygeias (KMY) 151
3.2.3.2 Koinsep Ekati (KE) 155
3.2.4 Discussion 157
3.2.4.1 The roles and rights of stakeholders in the governance of social enterprises 157
3.2.4.2 Participatory stakeholder mechanisms 158
3.2.5 Case study conclusions 159
3.2.5.1 Limitations and future research 159
3.2.5.2 Practical implications 160
3.3 Greece: Social enterprises and the integration of persons with mental disabilities in Greece: A case study of Koispe Athena-Elpis 161
3.3.1 Introduction 161
3.3.1.1 Social enterprises of work integration in Greece 161
3.3.1.2 Participatory governance and the Koispe legal form 164
3.3.1.3 Type A members in the governance of the Koispe legal form 167
3.3.2 Method 170
3.3.2.1 Case study approach 170
3.3.2.2 Respondents 171
3.3.2.3 Procedure and analysis 171
3.3.3 The case study results 173
3.3.3.1 The participation of Type A members in the functioning and governance of the Koispe Athena-Elpis 173
3.3.3.2 The various roles and rights of the mentally disabled in the functioning and decision-making of the organisation 175
3.3.3.3 Towards a structured process for the participation of the mentally disabled in the Koispe governance structure 180
3.3.4 Discussion 184
3.3.5 Case study conclusions 185
3.3.5.1 Limitations and future research 185
3.3.5.2 Practical implications 186
3.4 UK: Stakeholder participation in social enterprises: two case studies involving community interest companies in Scotland 186
3.4.1 Introduction 187
3.4.1.1 Social enterprises in the UK and the CIC legal form 187
3.4.1.2 The community purpose of the CIC 189
3.4.1.3 The financial structure of the CIC 189
3.4.1.4 The participatory governance of the
CIC and accountability 190
3.4.2 Method 198
3.4.2.1 The case study approach 198
3.4.2.2 Respondents 199
3.4.2.3 Procedure and analysis 200
3.4.3 The case study results 202
3.4.3.1 Stakeholders as members and owners of shares in the examined CICs 204
3.4.3.2 Stakeholders as decision-makers in the examined CICs 207
3.4.3.3 Stakeholders as consultants in the examined CICs 210
3.4.3.4 Stakeholders as recipients of information regarding decisions 212
3.4.4 Discussion 214
3.4.5 Case study conclusions 217
3.4.5.1 Limitations and future research 217
3.4.5.2 Practical implications 218
3.5 UK: Participatory governance in community energy schemes in the UK: The case study Stratford Community Energy PLCIC 219
3.5.1 Introduction 219
3.5.1.1 The CIC in community energy schemes 219
3.5.1.2 The CIC and the CIC legal framework 225
3.5.1.3 Community participation in the governance of the
CIC and accountability 225
3.5.1.4 The role of stakeholders in the CIC 226
3.5.2 Method 228
3.5.2.1 The case study approach: data collection and data analysis 228
3.5.2.2 Limitations in the data collection and data analysis method employed for the development of the Stratford PLCIC case study 229
3.5.3 Case study results 233
3.5.3.1 Introduction to the case study: the Drayton Manor Farm project, Anesco and the Stratford PLCIC 233
3.5.3.2 Stratford’s PLCIC community objectives in the Drayton Manor Farm Project 236
3.5.3.3 The participatory governance of Stratford PLCIC 237
3.5.4 Discussion 241
3.5.5 Case study conclusions 243
3.5.5.1 Limitations and future research 244
3.5.5.2 Practical implications 244
3.6 A meta-synthesis and cross-case analysis of case studies regarding the participatory governance of social enterprises in Belgium, Greece, and the UK 245
3.6.1 An overview of the developed cases concerning the participatory governance of social enterprises 245
3.6.2 Methodology 248
3.6.3 Results and discussion 250
3.6.3.1 The roles of stakeholders in the examined cases: A cross-national examination 250
3.6.3.2 The level and scope of involvement of stakeholders 261
3.6.3.3 The lack of effectiveness of legally prescribed (formal) participatory governance to include stakeholders in the decision-making of social enterprises 270
3.6.3.4 The effect of legally prescribed stakeholder participatory governance on the social enterprises and on stakeholders 278
3.6.4 Conclusions 279

Chapter 4. Participatory governance in Dutch social enterprises: a survey-based approach 281
4.1 Introduction 282
4.2 The Nyenrode – PwC Social Enterprise Survey of 2016 288
4.3 Methodology 289
4.3.1 The development of the survey sample 289
4.3.2 The content of the survey questions 290
4.3.3 The analysis of the collected data 293
4.4 Survey results and discussion 294
4.4.1 The extent of input used from different stakeholder groups in the decision-making processes of the Dutch social enterprises 294
4.4.2 The extent of transparency concerning the content and outcome of decisions 299
4.4.3 The extent of formal, direct and regular collected input from stakeholders 301
4.4.3.1 Formal vs. informal 301
4.4.3.2 Ad hoc vs. regular 302
4.4.3.3 Direct vs. indirect 303
4.5 Conclusions 305

Chapter 5. Summary, conclusions, and recommendations 307
5.1 Summary 307
5.2 General conclusions 307
5.2.1 Similarities in the key characteristic of participatory governance 309
5.2.2 Differences in the key characteristic of participatory governance 309
5.2.3 Stakeholder participation in practice 310
5.2.3.1 The functioning of participatory governance 311
5.2.3.2 The effect and the effectiveness of participatory governance 311
5.2.3.3 Participatory governance in the Netherlands 314
5.3 Recommendations 314

Abstract 319
Annex I 321
Annex II 329
Bibliography 333


Index