Russian government approves draft law on social entrepreneurship
This Bill recognises social entrepreneurship as a separate area of activity for small and medium-sized enterprises (SMEs).
A report published on the Cabinet of Ministers website states that the Russian Government has approved a Bill that enshrines the concepts of “social entrepreneurship” and “social enterprise” into law. The document will be submitted for consideration by the Federation’s State Duma. The Government stresses that adoption of the Bill will allow for targeted State support to be provided to social enterprises.
Under the Bill, “social enterprises” will provide employment to socially disadvantaged citizen groups, with the share of such workers in each organisation being at least 50% and accounting for at least 25% in terms of the total wage bill. In addition, “social enterprises” will be classed as organisations that ensure access of goods, works and services produced by socially disadvantaged citizen groups to the market, or organisations that produce goods, works and services specifically for socially disadvantaged citizen groups “in order to overcome, replace or compensate for disability”.
“The Bill allows for targeted State support to social entrepreneurs including within the framework of implementing the national “SMEs and support for individual business initiatives” project. Information on these entrepreneurs will be included on a single register”, said Russia’s Prime Minister, Dmitry Medvedev.
The social entrepreneur works to provide socially useful services including environmental, education and culture, he stressed. At the same time, Medvedev stated that the share of income derived from such activities should be at least 50%. According to the Prime Minister, a social enterprise should provide access of goods produced by socially disadvantaged citizen groups to the market. Social entrepreneur products usually made in small volumes and often manually designed for specific consumers must be put on the market, he stressed.
The Bill passed the “Zero” Reading stage in the Federation’s Public Chamber in November. The text was drafted by the Government’s Ministry of Economic Development. Earlier, the Ministry compiled a rating of regions based on their implementation of support mechanisms for SONGOs and social entrepreneurship; ensuring NGO access to the social services market and introducing new competitive ways for providing State services in the social sector.