The third sector of the economy, where social enterprises sit, has increasingly become a key driver of social progress where legislative and market failures occur. Social enterprises are a proven model for social change given the autonomous nature of the social-economic model they apply to reduce state social welfare dependence.
The contribution of social enterprises to create social and economic value has been considered to be of significant importance, particularly within the local contexts in which they operate. Yet there are substantive gaps in understanding around the value and impact of social enterprises to sustainability. One particular question that remains to be answered revolves around the necessary scale at which models of social enterprises are required for widespread systemic transformation to address climate change.
The model for social enterprises shows clear promise to be more extensively applied to address the current environmental challenges associated with the dominant (and broadly) unsustainable neo-liberal market approaches. In so doing, social enterprises operating at a community level show clear potential to positively impact across social, economic, and environmental domains. Such “win-win-win” outcomes from social enterprises operating within the energy sector across all three domains are investigated in-depth in the article “Social enterprise as a potential niche innovation breakout for low carbon transition,” published in the journal Energy Policy.
In this journal article, evidence from seven organizations from the UK are discussed and analyzed within the conceptual frame of sustainability transitions. Data was gathered from semi-structured interviews with key informants from the energy sector. Specifically, key informants were questioned regarding the social enterprise model adopted and its value to the energy sector. The results were transcribed verbatim and analyzed using thematic analysis. The analysis identified key themes pertaining to sustainability transitions and the value of the social enterprise model in the development of the low carbon energy sector.
A number of key findings are identified in the article. Principally, typical business structures, conflicting priorities, and considerations surrounding financial sustainability threaten the viability of alternative business models. Key informants highlighted that importance of social capital and community links as an integral component of social enterprises. It is argued that these links are essential for social sustainability — an often overlooked area within sustainability transitions. Key informants stressed the difficulties faced by social enterprises operating within a market environment.
Such difficulties include social enterprises being taken advantage of by much larger regime actors, and the necessity for collaboration between enterprises to increase viability, effectiveness, and legitimacy. This demonstrates the dynamics between particular niche level innovations and the dominant energy regime. The niche level is particularly important to sustainability transitions as it provides a protected experimental space for fostering innovation. These findings are of particular importance as they highlight that social enterprises can support the development of further innovations. Innovation is an important component of the transition towards sustainability at the niche level.