Social Enterprise

What is Social Enterprise?

A business that trades in order to pursue social or environmental objectives, reinvesting most or all of its surplus into that purpose rather than distributing it to owners. It still has to earn enough revenue to cover its costs and remain viable, so financial discipline and social purpose operate together rather than in opposition.

This definition is part of the Understanding Business Activity chapter in Cambridge O Level Business Studies.

Concepts related to Social Enterprise

• surplus
• reinvestment
• social objective

Common mistakes with Social Enterprise

• “Social enterprises do not need to make money.” Correct A social enterprise trades for a social or environmental purpose, but still needs enough revenue or surplus to survive and reinvest. Social purpose and financial discipline are not opposites.