Social Franchises

Discussion

"The UK has lost much of its manufacturing but retains its 'Foundational Economy'. This is the sector of the economy that supplies mundane but essential goods and services such as: infrastructures; utilities; food processing, retailing and distribution; and health, education and welfare. The foundational economy is unglamorous but important because is used by everyone regardless of income or social status and employs around 10 million people. It is neglected in current industrial policy.

Most foundational activities are sheltered by implicit or explicit state guarantees. CRESC suggests that the state should use this leverage to treat such activities as ‘social franchises’. These would be granted to enterprises that also offer social returns such as: supporting local communities and firms; living wages; sustainable supply chains; import substitution; and/or energy and resource sustainability. The aim is to move from destructive short-term 'point value' thinking

Profitability is important, but so too is the broader social and economic context. Current UK economic orthodoxy does not sufficiently attend to the latter. It focuses instead on a 'point value' market logic, seeking short-term 'best value' in each individual transaction. However point value destroys productive capacity in industry. Social franchising is a way of adding value by recreating the conditions for longer-term industrial wealth-creation." (http://www.cresc.ac.uk/our-research/remaking-capitalism/the-foundational-economy)