Towards a Wellbeing Economy: What Can Social Enterprise provide?

Michael J. Roy

In recent years, the concept of a 'wellbeing economy' has gained traction in several countries around the world as a critique of contemporary economic orthodoxy, recognising that the dominance of measures such as GDP and the unquestioned idea of perpetual growth has proven to be so destructive to the wellbeing of our society and environment. A wellbeing economy involves living within planetary ecological boundaries; ensuring equitable distribution of wealth and opportunity; efficiently allocating resources, including environmental and social public goods; and placing wellbeing at the heart of policymaking, particularly economic policy. The argument goes that a fundamental shift in perspective is required – from thinking about the economy as a crucial means by which wellbeing gains can be achieved, not as an end in itself. It comes at a critical time as we face challenges such as unprecedented levels of inequality, an escalating climate crisis, and growing political instability and conflict.

The idea of a wellbeing economy is not entirely new. Its roots can be traced as far back as Aristotle's concept of eudaimonia, or 'the good life,' which emphasises living a happy, healthy, and fulfilled life over the endless pursuit of wealth. Today, as part of the Wellbeing Governments (WEGo) partnership, several small countries including Scotland, Finland, Wales, Iceland, and New Zealand, are leading the charge to reshape economic policies to focus on wellbeing over GDP growth. Similarly, in other areas of the globe, such as in Latin America, work towards ‘buen vivir’ or ‘good living’ is underway which emphasises the rights of nature and prioritises indigenous ways of thinking, working and being.

The Role of Social Enterprise

My argument is that social enterprises offer valuable insights for building a wellbeing economy. These organisations work implicitly or explicitly to improve wellbeing rather than focusing on personal enrichment to address the needs of individuals and communities. Social enterprises – at least in the conceptualisations I am comfortable with – trade on a 'not-for-personal-profit' basis, constantly navigating and negotiating the tension between social goals and financial sustainability while aiming to reinvest any surplus to support their community and mission.

Social enterprises thus look to create and retain wealth within communities, focusing on social, economic, and environmental outcomes, rather than returns for shareholders. They have been promoted as a means of transitioning people out of disadvantage, addressing poverty, mitigating social exclusion, and promoting economic democracy. Research over the last decade or more has demonstrated health and wellbeing benefits on their beneficiaries and communities. Their work at the community level aligns closely with the idea of a place-based approach to wellbeing economy, including important initiatives such as Community Wealth Building. Moreover, by considering social, economic, and environmental outcomes, social enterprises embody the multidimensional nature of wellbeing. Rather than focusing solely on financial metrics, social enterprises prioritise social impact, addressing vulnerability through working with disadvantaged groups, providing jobs, skills, and work experience, often in fragile local economies.

Challenges and considerations

There are, however, several challenges that require to be overcome for organisations such as social enterprises to provide a solid platform on which to build a wellbeing economy. Like the concept of a wellbeing economy itself, social enterprise is a fluid and contested concept, similar to the ideas of social entrepreneurship and social innovation, which can make it difficult to define, and thus measure impact, consistently. Many social enterprises operate at a ‘hyperlocal’ level so scaling up their impact to influence what are clearly issues at a system level presents significant challenges. Pressures to ‘scale’ can force social enterprises to leave the communities they serve behind. But questions of ‘scale’ can be considered with far more nuance: it is often just as much about reaching broader geographical areas and communities (scaling out), influencing policies and institutions (scaling up), or even shifting cultural values (scaling deep).  

Developing appropriate policies and support structures – building a supportive ‘ecosystem’ of support for social enterprises – is crucial. In Scotland, for example, we have seen a ten-year strategy for supporting social enterprises, a series of Action Plans backed up by government investment, and, most recently, an expert working group calling for a new approach to increasing the role of ‘inclusive and democratic business models’ in Scotland’s economy. This includes social enterprises, co-operatives, employee-owned businesses, development trusts, and other models. The report emphasised the crucially important role of such organisations to the global economy, not in the margins of, or as a sideline to, the mainstream, but as part of a movement that staggeringly employs one in ten people of working age in the world.  

As we grapple with the ‘grand challenges’ of the 21st century, the need for a new economic model that prioritises wellbeing over narrow and simplistic measures of growth becomes increasingly apparent. Social enterprises, with their focus on community impact and holistic outcomes, offer valuable insights for shaping a wellbeing economy. By learning from the local focus of social enterprise, their emphasis on equitable wealth distribution, and alternative measures of success, we can work towards an economic system that truly serves people and the planet. However, this transition will require us to overcome significant conceptual, practical, and methodological challenges. As we move forward, it is crucial to continue exploring and supporting innovative economic models that prioritise wellbeing. By doing so, we can create a more sustainable, equitable, and fulfilling future for all.

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Michael Roy PhD is Professor of Social Innovation and Sustainable Organisations, and Associate Dean (Research and Innovation), at Stirling Management School, the University of Stirling, UK. An economic sociologist, his research is broadly on social policy related to social enterprise and the third sector; community-led social innovation; and new forms of partnership working between the state and civil society. He has published in a wide array of journals recently including Journal of Social Policy, Public Management Review, Public Money and Management, Business and Society, and Nonprofit and Voluntary Sector Quarterly. His research has been funded by a variety of blue chip funders including the UK’s Economic and Social Research Council (ESRC), National Institute for Health Research (NIHR), the Arts and Humanities Research Council (AHRC), and both the Canadian and Australian Research Councils. He is Editor in Chief of Social Enterprise Journal and Associate Editor of the Journal of Social Entrepreneurship. 

His online profile: https://www.stir.ac.uk/people/1967536