Low-Profit Companies - From Best Practice to All Practice


Theme 2   Entrepreneurship and business economics.

Researchers and academics.

They already exist: Companies that are trying out sustainable business practices with new business models. Not the traditional social enterprises such as health centers and welfare stations are meant, but social entrepreneurs and SMEs, which as stock company, Ltd. or cooperative have private ownership structures and in which sustainability and the common good have priority over profit. Some of them are intentionally not profit-oriented. The shareholders receive a moderate dividend depending on the success of the business. However, funding poses a particular challenge and requires a talent for improvisation, e. g. crowdfunding, direct loans from private individuals or government subsidies. Therefore, such companies are often dependent on do-gooders who are satisfied with a low return in favor of a good cause, also known as philanthropic investors.󠄀

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There are best practice examples with different legal forms in the areas of food and energy supply, banks, housing, clothing or fair trade, e. g. Regionalwert AG, a "citizens' stock corporation" that promote the production and marketing of organic food within the region and has not yet paid dividends to shareholders. There are also a number of not-for-profit eco-electricity providers: Naturstrom describes itself as a “citizens' energy company” in the form of a stock company. The cooperatives Greenpeace (Green Planet) Energy and EWS Elektrizitätswerke Schönau have a similar business model. Among the sustainable banks, the cooperative GLS Bank is a good example, as it pays its members (shareholders) a modest dividend of 1–3% p.a. All of these best practice examples have in common that they are low-profit companies. However, in the overall economic perspective, these at best lead a niche existence. The question arises: Can best practice examples be generalized? How do we get from best practice to all practice?

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Finally, the question arises: What role does politics play? How can the central bank and the state create favorable framework conditions for low-profit companies? Which measures are suitable to make low-profit business attractive for private investors? How can politics make low-profit the guideline of a new corporate culture and thus promote eco-socio-economic change?



Presented by: Christian Fahrbach (Leuphana University Lüneburg, Germany)

Workshop (75 min)


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