Assessing the social and solidarity economy in Luxembourg

Francesco Sarracino | Chiara Peroni
2015

EMES Conferences Selected Papers Series, ECSP-5EMES-18

A social enterprise is a private and autonomous organisation pro-viding goods or services with an explicit aim to benefit the com-munity, owned or managed by a group of citizens in which the material interest of investors is subject to limits (OECD, 2009).

Policy-makers, scholars and operators regard the social economy as crucial to build sustainable and inclusive growth, i.e. an innovation-based growth compatible with social cohesion and job creation (Rosenblatt, 2013). There
are various reasons for this. Firstly, organisations belonging to the social economy – throughout this report referred to as social enterprises independently from their legal status – are considered better fit to address social or environmental issues than public institutions (Borzaga et al., 2010; Becchetti and Borzaga, 2012). Secondly, as highlighted by the Social Economy Intergroup of the European Parliament, social enterprises are better equipped to face the economic crisis than many private companies. Furthermore, social enterprises often pursue long-term action plans, and they are less likely to relocate abroad even if they develop on an international scale (Toia report, 2013). These reasons raised the interest in social entrepreneurship in Luxembourg as well as in the rest of Europe, United States and some regions of the East and far East.

In recent years, government schemes aimed at fostering the social economy have accompanied the emergence of new business initiatives. Luxembourg is the first European country to have established a Ministry of the solidarity
economy in 2009, and to have implemented a government program to support this sector. According to the Luxembourgish government, the social economy is an innovative sector offering new solutions for a more sustainable economy. In 2011, the Government implemented the first Action Plan for Solidarity Economy (PLES) aimed at promoting and developing social enterprises. In the same year, Business Initiative launched a new support system for business
projects with a social or solidarity aim in Luxembourg (the program is called 1,2,3 GO Social). In 2013, the proliferation of social and solidarity initiatives led to the establishment of the Luxembourg Union of the Social and Solidarity Economy (ULESS) whose goal is to represent, inform, educate and promote the principles and values of the social economy in Luxembourg.

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