Social purpose companies (sociétés à finalité sociale, SFS) and cooperative societies (recognized by the National Council for Cooperation, CNC) constitute the “commercial company” component of the social economy. To date, no macroeconomic statistics are available on this set of organizations (source: www.ces-ulg.be).
Cooperative societies
Cooperative societies promote democracy and redistribution of profits depending on their cooperative activity.
In Belgium there are two sets of cooperatives: the cooperatives and the cooperatives authorized under the National Council for Cooperation (CNC). The latter have certain advantages and they have to respect some additional principles, in line with the cooperative spirit. Registered cooperatives represent approximately 2% of all cooperatives in Belgium.
Finally, a new form of cooperation has been increasingly developing in Belgium: the activity cooperatives (source: www.socialeconomy.be).
Social purpose companies
Social purpose companies are commercial companies like others; yet, they have chosen to introduce 9 additional, specific conditions in their statutes.
Initially, the objective of SFS status was to offer a legal status to activities that combine a social purpose with the main pursuit of commercial or industrial activities.
Currently, there are not more than some hundreds of such companies across various sectors (source: www.socialeconomy.be).
The conditions for SFS
The 9 additional constraints that SFS must satisfy are the following (source: www.socialeconomy.be):
– partners cannot seek a pecuniary benefit or they can only seek a limited one
– clear definition of the social purpose
– definition of the allocation policy of profits in accordance with the social purpose
– nobody may own more than 10% of votes (5% if a worker is also involved)
– if the company provides a limited sum of money to its members, this benefit may not exceed a set interest rate
– a special report must be annually prepared to explain how to reach the set social objectives
– ways for a worker to become partner
– ways for an ex employee not to remain a society’s partner
– in case of liquidation, surplus liquidation must be allocated to a goal that more resembles the original society’s scope.
