When we talk about social entrepreneurship in Croatia, it did not appear until 2015 when the Government of the Republic of Croatia adopted the Strategy for the Development of Social Entrepreneurship in the Republic of Croatia 2015 until 2020. Although it officially appeared in 2015, social entrepreneurship has been present for more than 150 years and is based on the tradition of cooperatives. The interesting fact is that the first cooperative was established in 1846, and before World War II, about 2,500 cooperatives with 460,000 members existed in Croatia.
If we go back to the strategy mentioned before, it defines social entrepreneurship as “a business based on the principles of social, environmental and economic sustainability, in which generated profit is entirely or largely reinvested for the benefit of the community”. The focus of work is on innovatively providing goods and services, and generated profit is primarily used to achieve social objectives. Regardless of the goals of the Strategy, the only way to identify the social enterprises in Croatia is by writing reports and making research on the topic. In one research that was within the project European Social Enterprise Monitor (ESEM) in 2020, participated 86 social enterprises from Croatia – the biggest percentage made Limited Liability Companies 32%, non-profit organizations 23%, cooperatives 20%, and simply limited liability companies that made 11%. Other participants were institutions, crafts, joint-stock companies, family farms, and others.
Besides the term “social enterprise” or “social entrepreneurship” the prefix “eco” appears. Nowadays, great emphasis is placed on the concept of “sustainability”, so entrepreneurs are wondering what they can do to make their business more sustainable and socially responsible? The answer lies in implementing the Sustainable Development Goals (from here on in the text as SDG). In addition to the introduction of SDGs, the internal motivation of the individual to work in a social enterprise is very important. Often environmental protection is the motivation to work in a social enterprise. Due to that, the emphasis is on environmental protection and reducing the negative impact on nature during production, so it can be said that companies are becoming “eco-social”. According to Puđak and Šimleša research (2019), people who work at the social enterprise are motivated by social approval, a sense of equity, autonomy, and other non-monetary aspects of work. Also, the participants of the research connected their willingness to work in social enterprise with the definition of social entrepreneurship, especially with the part of helping others, making better for the community, and being protective of the environment.
Although the motivation of employees to work in a social enterprise is high, enterprises often face obstacles that are as following: low visibility of social enterprise and social benefit delivered, corruption, lack of managerial skills and competencies of social entrepreneurs, small organizations may have difficulties in competing for European funding and be hence excluded, risk of lower engagement of volunteers, etc.
For readers to get an insight into the business of a social enterprise, the following are just a few examples of good practices in Croatia:
- Hedona (Social Enterprise LLC) was founded in 2013, as part of the project “Chocolateria Chris” – Krizevci chocolateria, by the enthusiastic Association of Persons with Disabilities Krizevci. Today, Hedona Chocolateria has 18 employees, 9 of whom are people with disabilities.
- Humana Nova (Social Enterprise) works in the scope of 3 areas: environment, social environment, and economy. They employ persons with disabilities and other socially excluded persons. The company produces clothing and textiles through reusing, repurposing, recycling, and other sustainable techniques.
- Održivo društvo d.o.o. (Social Enterprise SME), founded as a social enterprise by an NGO Udruga Prospero. The company produces footwear and organizes educational courses for footwear making and self-employment. Their target groups are women and young people in NEETs situations.
To conclude, social entrepreneurship in the Republic of Croatia is not legally supported, also mentioned strategy does not implement all measures and goals that are conceived and written in it. Therefore, eco-social entrepreneurship has not found its place in the laws and strategies for the development of entrepreneurship in the Republic of Croatia. Regardless of the current situation, examples of good practice indicate the work of social enterprises without the “support” of the law, and we hope that this situation will change soon.
- Vidović, D. (2019) Social enterprises and their ecosystems in Europe, pages 16-20, https://www.bib.irb.hr/1062773
- Kolaković, M., Turuk, M., Turčić, I. (2018) Social Entrepreneurship: Strategic Development in Croatia, pages 132-133, Zagreb International Review of Economics & Business.
- Puđak, J., Šimleša, D. (2019) Is Social Entrepreneurship Better for Workers? The Influence of Work Experience in Croatian Social Cooperatives on Perceived Well-Being, Croatian Sociological Review, pages 7-30, https://hrcak.srce.hr/237757
- European Comission (2016), Boosting social entrepreneurship and social enterprise creation: Unlocking the potential of social enterprises in Croatia (pages 66-83) https://www.oecd.org/employment/leed/Croatia%20report%2025.11.16-FINAL.pdf