British Columbia will soon become home to a new corporate structure designed to bridge the gap between for-profit businesses and non-profit enterprises. The B.C. government approved regulations in early March 2013 to allow the creation of community contribution companies (CCCs), a hybrid business model designed to spur private investment in the province's social enterprise sector. The establishment of CCCs was originally proposed in Bill 23, The Finance Statutes Amendment Act, which was introduced in March, 2012
Inspired by a similar policy in the U.K., CCCs will have access to privileges currently unavailable to non-profits, such as the ability to accept equity investment, issue shares, and pay shareholder dividends. These regulatory changes recognize the important economic impacts of social enterprises, and will help the sector sustain their important community-based missions.
This announcement was welcome news for Canada's social enterprise sector, and marks a clear commitment from B.C. to remain at the cutting edge of social investment policy. The new regulations are slated to take effect on July 29, 2013.
How will it work?
- CCCs are required to devote a portion of their profits to community purposes, which are determined at the time of incorporation.
- CCCs will be restricted abilities to distribute profits. Investor returns will be controlled according to set regulations.
- CCCS are to remain accountable to the community. All incorporated CCCs will be obligated to publish an annual report outlining its community impact spending.
“This step keeps British Columbia at the front of the pack when it comes to demonstrating leadership in the area of social innovation and social entrepreneurship.”
- Honourable Moira Stilwell, Minister of Social Development