Social Enterprises Are the Heroes of a Quiet Revolution. Their Power Lies in Systemic Change – Shows Extensive Economic Research

What is the true value of social enterprises? An international study analyzing 49 business entities from ten countries—including the Czech Republic, India, and the United States—shows that social enterprises are not just about “helping the vulnerable.” They represent an innovative tool for systemic change. They influence individuals, provide resources, and shape society—without having profit maximization as their primary goal. A study by researchers from the Prague University of Economics and Business introduces a new framework for understanding how social enterprises operate and how their societal impact can be measured.

Social enterprises are organizations that combine business activities with solving social problems. In a world facing poverty, inequality in labor markets, armed conflicts, and climate crises, these enterprises are gaining increasing attention. There are already more than 10 million social enterprises worldwide, generating an astonishing annual income of two trillion dollars (1).

An international research group from the Department of Entrepreneurship at the Prague University of Economics and Business set out to discover the magic behind them. The team studied 49 social enterprises across ten countries (including the Czech Republic, Austria, Germany, Italy, India, the Netherlands, and the U.S.), and through analyzing various sectors (from sustainable fashion and food to eco-friendly packaging and recyclable bottles), they aimed to understand how social enterprises are changing the world around them.

Three Key Areas Where Social Enterprises Excel: Empowering Individuals, Providing Capital, and Influencing Society

The researchers focused on the areas where social enterprises most frequently operate. They identified three main spheres of impact:

1. Changing Mindsets and Attitudes – Transformations in people’s thinking, attitudes, or skills. For example, when an enterprise helps people find purpose at work, boosts self-confidence, or encourages healthier habits.
“It’s not just about helping people get a job,” says Georgios Polychronopoulos, the lead researcher. “It’s about how work changes their lives. When someone starts believing in themselves or changes their lifestyle—for example, stops drinking or begins planning their day—that’s the real transformation.”

Example: An enterprise employing formerly incarcerated individuals doesn’t just integrate them into the workforce but also provides mentoring to help them regain confidence and life skills necessary for reintegration into society.

2. Providing Capital – And Not Just Financial
“Capital doesn’t mean only money,” the authors emphasize. “Other forms are often more important—for example, teaching someone new skills (human capital), providing them with tools or technology to work with (physical capital), or connecting them with someone who can help them move forward (social capital).”

Example: A social enterprise that teaches women from marginalized communities to sew and gives them sewing machines to earn income at home is combining three types of capital—human (education), physical (machine), and social (access to sales channels).

3. Influencing Society – Shaping Norms and Public Perception
This includes changing societal values and norms, supporting social movements, or influencing public policy. “Social enterprises want to change not just individuals, but the whole society,” say the authors. “For example, by showing that homeless people are not a ‘problem’ and that they can become valuable members of society if given a chance. This changes public opinion and creates social impact.”

Example: A campaign that shares the stories of homeless individuals working at a social enterprise helped spark policy discussions on homelessness at the city level.

It’s Not All Rosy – Social Enterprises Face Challenges and Dead Ends

The study also points out that not all social enterprises succeed on every front. “Social enterprises often have to make trade-offs—such as between breadth and depth of impact,” notes Polychronopoulos. “In other words, an enterprise may either help a large number of people in a relatively superficial way or provide deep, intensive help to a smaller group. Both approaches are valid, but it’s important to understand their differences and why they matter.”

Moreover, not all impacts of social enterprises are easy to measure. “Changes in public attitudes or influence on policy are much harder to quantify than, for example, the number of jobs created,” the authors note. “And yet, these less visible areas often hold the greatest power of social enterprises.”

A Vision for the Future: Business That Changes the World

Social entrepreneurship is not a trend but a growing global phenomenon that brings innovative solutions where traditional models fail. Social enterprises are not limited to those focused on employment and social inclusion of disadvantaged groups; their scope is much broader. This study shows that social enterprises not only provide help—they often pave the way for a new way of thinking about business, society, and sustainability.
You can read the full study by Georgios Polychronopoulos and his team.

Useful Information

• Social enterprises, unlike commercial businesses, aim to create a positive impact on society and the environment—for example, by employing disadvantaged individuals, supporting local communities, or improving environmental sustainability (2).
• Profit is a means, not an end. It is primarily a tool for achieving social and environmental goals, such as further development of the enterprise, rewarding employees, or funding socially beneficial activities (2)(3).
• Social enterprises are often innovative in their products, services, or business models (2)(3).

Sources

1. Schwab Foundation for Social Entrepreneurship & World Economic Forum. (2024). The State of Social Enterprise: A Review of Global Data 2013–2023. In Bertelsmann Foundation, Schwab Foundation for Social Entrepreneurship. [Online]. Available at: https://www3.weforum.org/docs/WEF_The_State_of_Social_Enterprise_2024.pdf (Accessed 18-05-2025).
2. Principles of Social Enterprise in a Nutshell. (n.d.). TESSEA. [Online]. Available at: https://www.tessea.cz/cz/socialnipodnikani/principy-socialniho-podniku/principy-socialniho-podniku-v-kostce (Accessed 18-05-2025).
3. Czech Social Entrepreneurship. (2024). [Online]. Available at: https://ceske-socialni-podnikani.cz/socialni-podnikani/principy-a-definice (Accessed 18-05-2025).