The Social Impact Factory is a business support structure that aims to spur social enterprise creation and embed more socially responsible behaviour in businesses. Its goal is to foster multi-stakeholder and cross-sectoral partnerships to tackle social challenges and to address miscommunication among profit, non-profit and public sectors that often have different rationales and languages. Although the concept of the Social Impact Factory was first developed in Utrecht, The Netherlands, the aim is to offer nationwide coverage and share knowledge and practices across the country.
Doing business sustainably and fairly is becoming commonplace in many organisations. Social enterprises are leading this trend by developing sustainable business concepts that value social impact over financial return. At the same time, governments face “complex problems” – such as unemployment, poverty and climate change – that require new solutions. To bring these public and private entities together, in 2014 the municipality of Utrecht and Kirkman Company initiated the Social Impact Factory.
The Social Impact Factory acts as a knowledge hub connecting local change-makers, social entrepreneurs, traditional businesses, government representatives, funders (public and private, formal and informal), knowledge institutions and networks, aligning their efforts and actions through three key activities:
- Social procurement: the Factory developed an online marketplace, called Social Impact Market (also known as “Buy Social”, managed in cooperation with the network organisation Social Enterprise NL), for traditional companies willing to purchase social products or services from social enterprises.
- Impact Challenges: a six-month programme connecting diverse stakeholders around a specific social challenge submitted by the municipality, to design solutions in an entrepreneurial way.
- Change-making: communication, research and lobbying efforts to accelerate change towards a society where doing business fairly, sustainably and inclusively is the standard.
As of mid-2018, the Factory’s partner network includes about 200 social enterprises, 10 large traditional businesses and 22 local governments (municipalities and provinces). Up until now, over 20 complex societal problems submitted by a variety of problem owners (including local government) were addressed in so-called "impact challenges". The total budget invested in social enterprises through these challenges amounts to over EUR 500 000. Lastly, the Social Impact Market has led to at least 100 matches in the past three years, totalling another EUR 500 000 in value.
This case study was adapted from a longer piece that was published in the OECD/EC (2017), Boosting Social Enterprise Development: Good Practice Compendium. For additional information and details, please refer to the original publication