New Social Enterprise model rules adopt 'surplus sharing' philosophy

Dec. 13, 2009 - PRLog -- New model rules for social enterprise published by Dr Rory Ridley-Duff at Scribd.com embed a 'surplus-sharing' mechanism designed to benefit all stakeholders.  The new rules, available under a Creative Commons Licence, permit copying and revision without advance permission from the author.  The updated company template (available at http://www.scribd.com/doc/11545936) is the culmination of 10 years practice-oriented research.

The rules provide for Founder, Labour and Investor shareholders.  Founder shares are allocated to people who create the enterprise.  Labour shares are issues to those contracted to provide labour on a continuous basis for more than a year.  Interestingly, shares are available to suppliers, self-employed contractors and directors, as well as those with an employment contract.  Investor shares can be purchased by anyone, or allocated to a charity, and an agreed percentage are allocated to labour shareholders at the end of each profitable year.

As Dr Ridley-Duff comments:

"The rules are designed to allocate benefits primarily to the those who contribute labour to an organisation, while also recognising the needs of other investors, customers and the wider community.  The rules can be adapted for consortia of cooperatives and the trading operations of third-sector organisations.  It provides an attractive structure for partnership working that rewards organisations who contribute staff time as well as financial capital."

Further advice on the use and adaptation of the rules is available through the Centre for Individual and Organisationl Development at Sheffield Business School where Rory has been appointed course leader for an MSc Social Enterprise and Business Democracy.

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Dr Rory Ridley-Duff was a director of Computercraft Ltd between 1989 and 2001, and a founding subscriber of Social Enterprise London (on behalf of Computercraft Ltd). He is currently course leader for the MSc Social Enterprise and Business Democracy at Sheffield Business School and a member of the editorial board of the Social Enterprise Journal. Rory has published academic papers in international governance, enterpreneurship and social enterprise journals, and is currently co-authoring Understanding Social Enterprise: Theory and Practice with Mike Bull (Manchester Metropolitan) and Pam Seanor (Huddersfield University) for Sage Publications.