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Social Enterprise 

This section provides information on social Enterprise

Social enterprise in Scotland

Social enterprise in Scotland is a thriving and growing section of our economy. The Social Enterprise Scotland 2015 census shows;


  • 5,199 social enterprises currently operate in Scotland
  • Scotland’s social enterprise sector employees 112,409
  • The total annual income from social enterprises across Scotland for 2015 was £3.63bn.

The statistics above show just how much social enterprise in Scotland is growing and developing. 42% of all of Scotland’s social enterprises have been formed in the last 10 years and with an average of 200 new social enterprises formed a year, this is a dynamic sector of our economy this is growing, expanding and developing at a very fast pace.


What is a social enterprise

Currently there is no legal definition of a social enterprise. A social enterprise trades and aims to make a profit like any other business, but a social enterprise will invest its profits into its social or environmental purposes. Another distinguishing feature of a social enterprise is its asset lock. This means any assets owned by the social enterprise cannot be transferred outwith the social enterprise for private gain. If the social enterprise is to close down, all assets must be transferred to a similar organisation who also reinvests its profit in a similar social or environmental purpose. Although social enterprise is not a legal structure, there is a voluntary code of conduct that social enterprises can sign up to. This shows they are adhering to best practice. The code is run by Social Enterprise Scotland, and aims to set a bench mark for all social enterprises. Social Enterprise Scotland currently defines a social enterprise by these 5 key points;

  1. A Social Enterprise (SE) is a business trading in the marketplace - selling goods and services - but whose primary objective is to achieve social and/or environmental benefit.
  2. Regardless of its legal form, the constitution of a SE will include the requirement that profits are reinvested in the business or in the beneficiary community - and not distributed to owners/ shareholders/investors. Some third sector organisations are constituted to pay dividends – certain co-ops; community shares; credit unions; some CICs etc.
  3. The constitution will always require that on dissolution, the assets of the SE are reinvested in another organisation with similar aims and objectives. Taken together Criteria 2 and 3 are referred to as the ‘asset lock’ - the defining characteristic of a SE - which distinguishes it from the private sector.
  4. SEs are different from those charities and voluntary organisations which do not aspire to financial independence through trading.
  5. SEs are distinct from the public sector and cannot be the subsidiary of a public body.


How is a social enterprise different to a community group or a charity?

A group may identify itself as a registered charity, a community group, a social enterprise or all three. These types of organisations often cross over in their aims, objectives and structures but there are some clear differences between the three. A group does not need to be social enterprise to generate income and generated income by their own trading does not have to be a group’s primary income source. Supplementing any other income source with trading will allow a group to have further development options and give them more possibilities for income generation. Even if trading is not a group’s sole or primary income, the principles of trading can be applied to help a group sell its services and market its product. It is helpful for a group to identify what they are currently operating as and what they wish to operate as.


  • All the groups identified above will have a social mission
  • All groups will re-invest their profits (sometimes called surpluses by charities). These reinvestments could be in the group itself to further its objectives or it could be in its social mission.



  • Charities and some community groups usually aim to fund their social mission through grants and donations.
  • The majority of a social enterprises income comes from trading, be that in goods or services.
  • Social enterprise or community group is not a legal structure with legal obligations, where as a registered charity is.




Social Enterprise in Skye and Lochalsh 

Locally to Skye and Lochalsh, Columba 1400 is a dynamic social enterprise. Established in 2000, Columba 1400 was awarded the Bank of Scotland/Sunday Times Social Entrepreneur of the Year, where the judges praised Columba 1400 for its “sustainable business model, entrepreneurial flair and the ability to diversify.” The Lochalsh and Skye Housing Association (LSHA), establish in 1983 is a thriving example of a social enterprise operating as a housing association. 

There is a lot of scope for local community groups and charities to consider trading as a social enterprise as a source of sustainable income. If this is something your group would in interested in please contact SLCVO on 01478 612921 or email info@slcvo.org.uk

Other social enterprise support organisations; 

Highland and Island Social Enterprise Zone (HISEZ

Social Enterprise Academy 

Social Enterprise Scotland 

Highland and Islands Enterprise

Development Trust Association Scotland

Business Gateway 







For Community Planning:
Willie Mackinnon Highland Council,
Phone: 01478 613849

Download the Highland Compact

Download The Highland Council's programme of action  'Working Together for the Highlands 2012 -2017'

For Health and Social Care Forum:
Meg Gillies Chief Development Officer SLCVO
Phone: 01478 612921
Email: meg.gillies@slcvo.org.uk

Download the Highland Change Plan 

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