State of Social Enterprise Africa 2025

The path forward is defined by five cross-cutting priorities. There is a need to: –Build enabling ecosystems by strengthening the policies, legal recognition and physical and digital infrastructure on which social enterprises rely –Unlock capital at scale through blended finance, strategic social procurement and impact-linked instruments to address persistent funding gaps –Invest in people and skills, focusing on entrepreneurship development, staff training and digital inclusion to boost organizational capacity –Foster partnerships for scale by promoting public–private partnerships (PPPs), cross-sector coalitions and regional cooperation to extend reach and impact –Strengthen data and evidence by supporting harmonized mapping, monitoring and public dashboards to inform better policy and investment decisions Public sector Social enterprises can play a key role in addressing national priorities, and governments can support social enterprises with supportive policies and legal frameworks. A compendium of policy recommendations for the broader social economy can be found in the World Economic Forum report Unlocking the Social Economy: Towards an Inclusive and Resilient Economy. In addition, the data and insights from this report on social enterprise in Africa highlights several areas through which governments can provide support to the sector. A. Institutional anchoring and coordination Governments can support the sector by: –Anchoring social enterprise policy within one or more lead ministries, selected in line with national priorities and the anticipated effects on support for social enterprises.77 –Assessing options using evidence and consultations, drawing on social enterprise data, labour market and SME studies, engagement with ministries, social enterprise networks and development partners to weigh trade-offs. For example: –Trade/industry: well placed to expand market access and procurement opportunities, but may place lower emphasis on social outcomes than other ministries –Labour and social protection: strong at advancing inclusion and decent work, but may provide less attention to enterprise development services –Finance: ensures alignment with fiscal incentives and access to credit but may focus more on capital flows than enterprise development or inclusion –Dedicated Social and Solidarity Economy (SSE) unit: provides coherence across the spectrum of SSE actors but may become siloed if not closely connected to other ministries –Creating an inter-ministerial coordination mechanism, bringing together key ministries to coordinate policy and align key performance indicators (KPIs), budget lines and timelines. –Convening a national social enterprise council, co-governed with social enterprise networks, civil society, the private sector, philanthropy and academia. The council should set priorities, track progress, collect data and act as a forum for problem-solving and course correction when policies or programmes underperform. –Maintaining accountability and visibility through an annual progress report to cabinet/parliament on jobs, inclusion, access to finance and social- value procurement, underpinned by agreed data standards. Why it matters: Clear institutional anchoring provides stability, while inter-ministerial coordination prevents fragmentation. A multistakeholder council ensures that the perspectives of business, philanthropy, academia and social enterprises are integrated into national strategies. Together, this architecture aligns incentives, strengthens accountability and creates a credible platform for scaling social enterprises as part of national development agendas. B. Legal and policy frameworks Governments can: –Understand how social enterprises leverage existing legal frameworks and how they register under company, cooperative or non-profit laws. Identify the barriers or gaps they face, particularly around accessing finance, procurement and tax incentives. –Where gaps persist, consider creating an optional social enterprise status or embedding provisions within broader social and solidarity economy legislation.78 Assess both the benefits and limitations of such approaches (such as access to procurement preferences, tax treatment for reinvested surpluses and eligibility for blended finance), and ensure they are designed to adequately support social enterprises. –Make formalization easy and inclusive by simplifying registration,79 offering model statutes and reducing barriers through temporary fee waivers and proportionate compliance Social enterprises can play a key role in addressing national priorities, and governments can support social enterprises with supportive policies and legal frameworks. The State of Social Enterprise: Unlocking Inclusive Growth, Jobs and Development in Africa 47