Association for Public Policy Analysis & Management

Systems that maintain social norms perpetuate the status quo of power disparities. The development of social enterprise offers the opportunity to fundamentally change the perpetuation of social and economic inequity. Social enterprise operations can be a part of effectively facilitating social change at the micro and macro level because of the ability to sustainably fund quality services and social change work. The development of social enterprise, when implemented with critical thought, can encourage economic mobility for those who have historically been marginalized by capitalism. To effectively develop meaningful social enterprise, policy must be in place to ensure that companies can uphold impactful social change goals and at this time social enterprise policy regarding implementation and evaluation varies greatly across states. Currently, there is no unified evaluative system to measure the success of social enterprise models in the U.S. Thus, it is difficult to make a data-driven recommendation for legislation that will produce the most effective business model. However, there is data on which states have adopted social enterprise legislation and the rate at which businesses are registered as a social enterprise per state. Because of the limited scope of social enterprise evaluation we can infer successes based on social enterprise adoption by state and then compare the specificities of the state statutes. Based on the data available, effective social enterprise legislation should align closely with the Benefit Corporation (B Corp) Model Legislation in order to augment transparency and accountability of the company’s mission and its progress reporting. Moreover, the State should increase its support in order to incentivize development of companies that will benefit the public. Tax breaks that increase the company’s revenue in order to invest in self-sustaining public or employee services should be implemented. State subsidies to support competitive wages should also be incorporated to promote successful growth of social enterprise nation wide.