Designing Legal Frameworks for Social Enterprises

Annex B. Case study – The Brussels 2018 Ordinance on social enterprises (Belgium): An inclusive policy-making process to co-construct a legal framework for social enterprises

What

Based on the EMES International Research Network approach of the social enterprise, the 2018 Ordinance establishes a set of criteria organised in three dimensions – social, economic and governance – and defines ‘social enterprise’ as private or public legal entities that implement an economic project, pursue a social purpose, and exercise democratic governance. In addition, the legal framework sets out the public support schemes that social enterprises can leverage, including financial and non-financial assistance.

The Ordinance on the accreditation and support of social enterprises was adopted on 23 July 2018 in the Brussels-Capital Region in Belgium. The adoption of this Ordinance results from a two-year consultation process with various stakeholders, including the Economic and Social Council of the Brussels-Capital Region (CESRBC), the Brussels Employment Office Actiris, the Brussels Social Economy Consultation Platform extended to ConcertES1 and SAW-B (see the steps below). Additional stakeholders, such as academics, federations of social enterprises and social enterprises themselves, also participated in the consultation process, especially to establish the definition of the social enterprise.

Why

When designing legal frameworks, an inclusive consultation process may be of fundamental importance as it refines how policy makers understand social enterprises and thus ensures that legal frameworks are relevant, appropriate and meet the needs of relevant stakeholders. Finally, co-constructing a legal framework helps avert practical implementation problems, enhances compliance and acceptance of such framework, and increases public trust in government.

Until recently, social enterprises and the social economy in the Brussels-Capital Region were largely associated with the work integration field. The objective of this policy-making process was twofold: (1) the revision of the 20042 and 20123 Ordinances on the social economy and the accreditation of work integration social enterprises; and (2) the recognition of social enterprises beyond the work integration field. Adopting a co-construction approach allowed the Government of the Brussels-Capital Region to collect valuable information from a variety of stakeholders to better capture the situation experienced by work integration social enterprises but also to refine their understating of the needs and realities of social enterprises working on issues beyond work integration.

Key Activities

The 2018 Brussels Ordinance on social enterprises results from a thorough and inclusive co-construction process between employer’s representatives, trade unions, social enterprise community, academics, and policy makers. The policy-making process to develop this legal framework took place over a period of two years and went through a range of crucial steps. In December 2016, the Office of the Brussels Minister of Employment and Economy (Minister’s Office) drafted a political note for the ordinance project in collaboration with the Brussels Economy and Employment Administration (BEE). This note was then presented to the Social Economy Consultation Platform as well as social economy experts including ConcertES. In March 2017, the note was approved by the Government of the Region. In parallel to this process, the Minister’s Office asked the CESRBC, the Social Economy Consultation Platform and Actiris to share their opinions on the note. These three organisations submitted their recommendations by September 2017.

Main steps of the policy-making process of the Brussels 2018 Ordinance on social enterprises

Source: Authors’ elaboration

The next step was to define social enterprises and to establish the criteria to recognise the entities covered by the legal framework. Given the complexity of defining social enterprises, the Minister’s Office appointed a social economy expert to determine a set of criteria for a social enterprise. Starting from October 2017, the expert led a four-month consultation process which brought together federations and representatives of the social economy (e.g. Febisp, FeBIO, Tracé Brussel and SAW-B). More precisely, the expert conducted individual interviews with main actors in the field and organised three working groups to discuss the pre-defined criteria. The first one was composed of work integration social enterprises, the second one of social enterprises that did not focus on work integration, and the third one of social economy public institutions (Institutions publiques d’Economie sociale – IPES). The Minister’s Office did not directly partake in the consultation but organised regular meetings with the social economy expert in order to follow the advancement of the process.

In January 2018, after reviewing the consultation outcomes with academic experts, the selected criteria defining a social enterprise were presented to the Social Economy Consultation Platform, the Minister’s Office, and the Minister-President of the Brussels-Capital Region. Additionally, upon request of the Council of State, a test run of these selected criteria was conducted with main actors in the field in May and June 2018. To do so, the BEE shared a survey with all structures already recognised by the former scheme for work integration enterprises as well as with other social enterprises.

Based on the survey results, the criteria for a social enterprise were included in the draft ordinance and the decree to implement the ordinance. The draft ordinance was then examined by the Committee on Economic Affairs and Employment of the Brussels Parliament in July 2018 and was voted in the Parliament on 23 July. Finally, the decree to implement the Ordinance was passed on 20 December 2018. As of June 2021, 155 social enterprises were accredited in the Brussels-Capital Region.

Impact

By starting the consultation process at an early stage of policy development, the Government of the Brussels-Capital Region helped maximise the value of stakeholder engagement. Engaging with a broad range of actors allowed to design a legal framework that is more aligned with the field’s needs and realities and that reflects a range of views in a proportionate way, thus avoiding its anchoring in a single ideology of social entrepreneurship. Such an inclusive policy-making process has also facilitated a broader acceptation of the criteria for social enterprises and enabled a common understanding and interpretation of the legal framework. Ultimately, the process has fostered dialogue between policy makers and main actors in the field. The dialogue remains open today and allows to easily gather these main actors around a table when needed.

The 2018 Ordinance had a positive impact on social enterprises as it has strengthened their legal certainty in relation to European State Aid legislation and has thus increased their access to financial resources. It has also allowed social enterprises to improve their internal processes, in particular regarding their governance. In short, the Brussels Ordinance on social enterprises and its policy-making process helped to both build common understanding of social enterprises and structure the overall field, which in turn fostered the development of social enterprises in the Brussels-Capital Region.

Table A B.1. List of main stakeholders involved in the policy-making process of the Brussels 2018 Ordinance on social enterprises

Stakeholder	Description
Actiris		Actiris is the Brussels Employment Office. As such it is tasked with implementing Brussels employment policy and ensuring the proper functioning of the job market in the Brussels-Capital Region. To this end, Actiris provides a wide range of services to businesses and jobseekers.
Brussels Economy and Employment Administration (BEE)		Brussels Economy and Employment contributes to the development of employment and supports the social economy. In this respect, it assumes many roles such as the approval and financing of social enterprises. BEE also promotes the socio-professional integration of workers who are particularly far from the labour market.
ConcertES		ConcertES is the concertation platform for organisations representative of the social economy active in the French-speaking part of Belgium.
Economic and Social Council of the Brussels-Capital Region (Conseil économique et social de la Région de Bruxelles-Capital - CESRBC)		CESRBC is the Region’s main consultative body on socioeconomic matters. It brings together the social partners: organisations representing employers, the self-employed, the non-profit sector and employees.
FeBIO		FeBIO (Federatie van Brusselse Initiatieven ter Ontwikkeling van de Werkgelegenheid) is the Dutch-speaking federation of social integration enterprises in Brussels.
FeBISP		FeBISP is the Brussels Federation of Socio-Professional Integration and Social Economy Integration Organisations. It is currently composed of 79 structures and 97 projects active in these two sectors.
Government of the Brussels-Capital Region		The Government of the Region is the executive body of the Brussels-Capital Region.
Parliament of the Brussels-Capital Region		The Parliament of the Brussels-Capital Region prepares the texts, votes the budgets and controls the regional Government.
Social Economy Consultation Platform (Plateforme de concertation de l'Economie Sociale)		This Platform gathers representatives of the Government of the Brussels-Capital Region, the Administration of Economy and Employment of the Ministry of the Region and the Brussels Regional Employment Office, as well as representative organisations of employers in the social economy sector, and of workers and employers sitting on the Economic and Social Council of the Brussels-Capital Region.
Solidarité des Alternatives Wallones et Bruxelloises (SAW-B)		SAW-B is a federation of social economy actors, as well as a research and training centre, offering integrated support to social enterprises and shaping, through lobbying activities, an institutional landscape favourable to their development. SAW-B notably co-ordinates CoopCity, Brussels centre dedicated to social, collaborative and cooperative entrepreneurship.
Tracé Brussel		Tracé Brussel is a Dutch-speaking organisation that tackles unemployment in Brussels. Its mission is to strengthen the position of all job-seekers on the labour market, especially vulnerable groups, and to promote their integration. Together with a network of partners, Tracé Brussel develops innovative paths towards training, employment and an inclusive economy.

References

Borzaga, C. and J. Defourny (2001), The Emergence of Social Enterprise, Routledge.

Government of Belgium (n.d.), Ordonnance relative à l'agrément et au soutien des entreprises sociales. http://www.ejustice.just.fgov.be/eli/ordonnance/2018/07/23/2018031816/justel.

OECD (2019), Better Regulation Practices across the European Union, OECD Publishing, Paris. https://doi.org/10.1787/9789264311732-en.

Plateforme de Concertation de l'Economie Sociale (2017). Avis concernant l’avant-projet d’ordonnance relative à l’agrément et au soutien de l’entrepreneuriat social.

SAW-B (2017). Réforme de l'ordonnance bruxelloise: se donner les moyens de ses ambitions.

Zwarts, P. (2019). Inspirations et contingences dans la politique économique bruxelloise en matière d'entreprises sociales. En référence à l'ordonnance de 2018, Université catholique de Louvain.

Notes

← 1.  The Brussels Social Economy Consultation Platform gathers representatives of the Government of the Brussels-Capital Region, the Administration of Economy and Employment, and the Brussels Regional Employment Office, as well as representative organisations of employers in the social economy sector, and of workers and employers sitting on the Economic and Social Council of the Brussels-Capital Region. ConcertES was invited to join the process as it is the concertation platform for the organisations representative of the social economy active in the French-speaking part of Belgium.

← 2.  Ordonnance relative à l'agrément et au financement des initiatives locales de développement de l'emploi et des entreprises d'insertion.

← 3.  Ordonnance relative à l'économie sociale et à l'agrément des entreprises d'insertion et des initiatives locales de développement de l'emploi en vue de l'octroi de subventionsThis 2012 Ordinance was never put into force, due to the lack of applicable decrees. The 2004 Ordinance was therefore the only one used as a reference before the 2018 Ordinance.