Social Enterprise in Italy: A Plurality of Business and Organisational Models

Simone Poledr ini and Carlo Borzaga

Introduction

In recent years, several scholars have engaged in the study of Italian social cooperatives from different perspectives, such as work quality and job satisfaction (Borzaga and Depedri 2005; Borzaga and Tortia 2006; Becchetti et al. 2014), theoretical framework (Bacchiega and Borzaga 2001; Borzaga and Tortia 2009; Poledrini 2015), various networking strategies (Daniele et al. 2009) or the impact of the recent financial crisis (Costa and Carini 2016). The focus on this type of enterprise has led over the years to the belief that social cooperatives are the only type of social enterprise (SE) that exists in Italy, or at least that they constitute the great majority of all Italian social enterprises.

Social cooperatives, however, do not exhaustively represent the whole SE “phenomenon” in Italy (Poledrini 2018); indeed, other non-profit organisations can also be considered as social enterprises in all respects, even though not all of them declare or consider themselves as such. The activities managed by social enterprises are also wider than those managed by social cooperatives. In fact, social enterprises have expanded their sectors of activity in recent years: whereas the first social enterprises only provided social, health-care, educational and work-integration services, SE activities now include the provision of other, innovative services such as environmental, cultural, sport and recreational activities, the promotion of economic development, etc. Moreover, the “Italian” concept of social enterprise is increasingly being flanked by those of “community enterprise”, “community cooperative” and “citizens’ cooperative”, and these types of social enterprise seem to have a considerable potential for growth.

In light of the above considerations, this chapter aims to present the widely varied landscape of social enterprise in Italy. In particular, the chapter will consider all the non-profit organisations characterised by a non-profit distribution constraint and by a clear social purpose but which behave as enterprises, despite not being legally classified as social enterprises. In other words, within the scope of the present analysis, the

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term social enterprise will refer not only to the organisations considered as social enterprises by Italian law, such as social cooperatives and social enterprises ruled by Legislative Decree No. 155 of 2006, but also to de facto social enterprises, established as associations, foundations and religious institutions. In particular, we will consider as social enterprises all the non-profit organisations that derive at least 50% of their total revenue from contracts or agreements with public institutions or from the sale of goods and services, and that have at least one employee.

The research questions we intend to answer are the following: “How many different types of social enterprise are there in Italy?”; “How many social enterprises of each type are there?” and “How do these various types differ?” To answer these research questions, we will present the various types of social enterprise and we will describe them in both qualitative and quantitative terms. The major future prospects of each SE type will be briefly taken into consideration, while the quantitative aspects will be presented in a more detailed analysis, based mainly on information from the 2011 census on non-profit institutions; the aspects that will be considered are (1) the number of employees; (2) the geographical distribution; (3) the sector of activity; and (4) the main sources of revenues.

The chapter is structured as follows: The first section describes the evolution of Italian social enterprises. The second section illustrates the research methodology and the general context of the analysis. The following four sections present the various types of Italian social enterprises, along with their key features, and analyse the quantitative information available for each type. The final section presents the conclusions.

Evolution of Italian Social Enterprises

To understand the origins and evolution of social enterprise in Italy, both as a concept and as a reality, it is important to bear in mind the economic, social and cultural changes that have taken place in the country since the 1970s. In fact, the 1970s and the following decades brought about the conditions that led to the formation of the first Italian social enterprises (Borzaga et al. 2017). In the following paragraphs, we briefly summarise this period in four main steps.

The 1970s: Emergence of a Growing Gap between the Demand for and Supply of Social Services

In the 1970s, Italy experienced for the first time a growing rift between new, emerging needs and the public welfare system’s ability to cope. The emergence of these new needs created a new “demand” for social services, which the public welfare system was not prepared to deal with. Moreover, in contrast to other countries, the non-profit sector was also poorly

Italy 133 developed (Barbetta 1997; Perlmutter 1991); existing non-profit organisations dealt almost exclusively with advocacy. Furthermore, according to the wording of the Civil Code, associations and foundations could not perform productive and commercial activities. All these elements resulted in a situation in which neither the Italian public welfare system nor the private—both for-profit and non-profit—sector was able to cope adequately with the new social needs of Italian society.

The 1980s: Emergence of an Organised Civic Response to the New Needs

In the 1980s, the marginalisation of various segments of the population (a phenomenon linked inter alia to the “new poverties”) gradually began to gain ground, due not only to the emerging new needs but also to the progressive closure of the traditional facilities for people with health and social problems, such as all-encompassing institutions that segregated people by limiting their relations with their family and community. As a reaction to these situations and in an attempt to answer those needs, groups of people, bound by idealistic values and serving mainly as volunteers, began to establish new services. After a few years, these voluntary organisations realised that public institutions would not step in to meet these new needs, and they gradually concluded that the range of services they were offering should be consolidated and extended, among other means by adopting the cooperative form. In those new, so-called social-solidarity cooperatives, in comparison to traditional cooperatives, elements of internal mutuality were attenuated, while those concerning solidarity were boosted. These organisations carried out work-integration and service-provision activities, running drug rehabilitation communities, group homes for children, reception facilities for the homeless, home-care services for the elderly, etc.

The 1990s: Recognition of Voluntary Organisations and Social Cooperatives

The major turning point in the development of Italian social enterprises, and particularly of those operating under the form of associations and cooperatives, took place in the late 1980s and early 1990s, when the fast multiplication of these organisations made necessary for public institutions to adopt specific regulations. This led to the implementation of a series of legislative measures, which resulted in turn in a further increase in the number of both voluntary organisations and social cooperatives throughout Italy during the following years. Particularly worth mentioning, among these legal actions, are the adoption of Law No. 381, in 1991, and of Law No. 266, in the

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same year, which recognised and regulated respectively social cooperatives and voluntary organisations.

The 2000s: Recognition of Social Enterprises' Pluralism

During the following years, numerous additional legal provisions were adopted. Some of them aimed to reorganise social policies, and more particularly the provision of social and general-interest services, while others were intended for acknowledging and regulating new types of non-profit organisations. In particular, in 2005, the Parliament approved Law No. 118 on social enterprises, which was complemented, in 2006, by Legislative Decree No. 155. This law recognises and regulates the possibility to establish a social enterprise under any legal form other than that of social cooperative and provided for by the Italian Civil Code. This legislation clearly constitutes, at least in theory, a significant change in the field of Italian social enterprise; indeed, this law makes it possible to create a social enterprise without necessarily making use of the socialcooperative form.