Findings from the 2016 Finding Australia’s Social Enterprise Sector (FASES) report, a joint initiative by the Centre for Social Impact (CSI) Swinburne and Social Traders have identified a need for greater access to finance for rural Australian social enterprises.
The study was based on data from 359 social enterprises, of which 73 per cent were small businesses, 23 per cent medium-sized and just four per cent were large organisations.
39 per cent of Australian social enterprises surveyed reported that the lack of access to appropriate finance negatively impacted on the realisation of their impact potential.
Social enterprises operating in and largely clustered around major metropolitan centres were more likely to be able to access external finance according to analysis of 739 social enterprises spread across 1034 locations in Australia.
The report specifically found that enterprises in rural areas and Western Australia are placed at a geographical disadvantage as a result, compared to those in Victoria which has the highest density of enterprises, for example.
Director of CSI Professor Jo Barraket, who also led the first FASES research in 2010, said that compared to five years ago, “philanthropy is playing a proportionately more significant role in financially supporting social enterprises.”
Building upon the 2016 report, the two equally most cited responses at 34% concerning social missions, were creating meaningful employment opportunities for people from a specific group, and developing new solutions to social, cultural, economic or environmental problems.
Despite this strong commitment by enterprises, the sector is still a largely invisible part of Australia’s economy.
Managing Director of Social Traders, David Brookes reiterated this, saying that social enterprise in Australia is on the rise and already contributes between “2 and 3% of GDP and employs over 300,000 Australians.”
Respondents surveyed echoed strong feelings about the need to build a more cohesive social enterprise ecosystem.
Limited policy development within the sector, low public awareness of social enterprises and their work, as well as the need for enhanced networking and development opportunities were cited by a majority of respondents as being areas of deep concern.
On broader support from government encouraging new growth opportunities for social enterprise, Professor Barraket said action needed to be two-fold.
“It’s partly about investing into and growing the ecosystem that supports social enterprise development, and it’s partly about rendering visible, recognising and supporting social enterprises as a field of business activity.”