State of Social Enterprise Africa 2025

–Informal enterprises: Some 24% of surveyed social enterprises operate without formal registration. The prevalence of informality varies significantly by country, from as low as 8% in South Africa to as high as 62% in Cameroon. This tendency is often shaped by practical considerations, including complex or costly registration processes, bureaucratic hurdles, limited awareness of the benefits of formalization and a strong preference for community-based, flexible operations.28 Operating outside formal frameworks, these enterprises prioritize local needs, draw on community support and resources and leverage networks and informal support systems, reflecting their deep social embeddedness. Emerging legal and policy frameworks at the global, regional and national level The legal and regulatory environment for social enterprises in Africa is a critical area of both progress and challenge. Globally, most countries do not have a dedicated legal designation for social enterprises. However, a variety of legal and policy frameworks are emerging, reflecting diverse approaches. In international policy, social enterprises are formally recognized as part of the broader social and solidarity economy (SSE) alongside cooperatives, mutual societies, associations and other community-based or non-profit organizations. At the international level, the International Labour Organization (ILO) resolution concerning Decent Work and the Social and Solidarity Economy (2022)29 and the United Nations General Assembly resolution Promoting the Social and Solidarity Economy for Sustainable Development30 provide important normative frameworks guiding laws and policies on the social and solidarity economy, which includes social enterprises. At the regional level, the African Union’s Ten- Year Social and Solidarity Economy Strategy and Implementation Plan (2023–2032),31 adopted by the AU Assembly of Heads of State and Government in February 2025, offers a comprehensive and coordinated policy framework to legitimize, support and expand the SSE across regional economic communities and member states in Africa. At the national level, a range of legal and policy approaches to social enterprises is emerging. These include national SSE laws and strategies as well as policy processes anchored in different political institutions. In contexts where no specific social enterprise recognitions exist, it becomes important to examine how existing legal and regulatory frameworks influence the incentives, constraints and adaptive strategies of social enterprises – and to identify what complementary instruments may be required to balance trade-offs and support their development. Overall, for social enterprises, what matters most is how these frameworks and approaches shape visibility, recognition and access to support. Types of legal registration among formal social enterprises by category FIGURE 1 Benefit corporation For-profit Not-for-profit Cooperatives and community benefit Other4%51% 3% 23% 1% 1% 1%2% 2% 3%1% Not-for-profitPrivate company Community benefit societyWorker cooperativePublic company Producer cooperativesMultistakeholder cooperativeEnterprise cooperativeCommunity interest company Source: Survey data, World Economic Forum The State of Social Enterprise: Unlocking Inclusive Growth, Jobs and Development in Africa 16