The social and solidarity economy and societal impact companies
Social utility, cooperation and local presence are values that are increasingly visible in our society and in the structures that make up the country's economy. Since 2016, Luxembourg has had a specific legal status for companies in the social and solidarity economy: societal impact companies. The dynamism of the sector is reflected in a new dedicated portal for the social and solidarity economy and the creation of the "Impact Luxembourg" label.
The social and solidarity economy
The social and solidarity economy is based on the idea of balancing economic activity and social equity to respond to the needs and challenges of today's society. It is an umbrella term that covers a series of entities rooted in the same values: social utility, cooperation and local presence adapted to the needs of the community and the population.
Did you know?
There is an Encyclopedia of the Social and Solidarity Economy, coordinated by the United Nations Inter-Agency Task Force on Social and Solidarity Economy (UNTFSSE). With a total of 57 entries and a list of 70 contributors from all over the world, the book – which was funded by Luxembourg – is available in open access. It is a tool that can provide stakeholders with additional knowledge and promote this social approach to a wider public.
The new social and solidarity-based approach is playing an increasing role in Luxembourg's economic fabric. The rapidly growing sector comprises players in fields as wide-ranging as social action, health, bioeconomics, the environment, culture, education and sport, as well as trade unions and political parties. In total, the sector represents 2.2% of national gross value added and 4% of the country's employment. On average, production associated with the social and solidarity economy is growing 4% more quickly than overall national production. It is also a sector that involves a considerable number of volunteers: in 2020, a total of 15 million hours were worked by more than 67,000 volunteers, representing 11% of the population.
Luxembourg, committed to the social and solidarity economy for more than 20 years
The social and solidarity economy may seem like a new concept in the economic landscape, but it goes back a long way in Luxembourg society. The first "Solidarity Economy Unit" was set up in the Ministry of Labour and Employment in 1999. The unit subsequently became a ministerial department, a first national action plan was adopted in 2011 and the word "social" was added. After the signing of the Luxembourg Declaration for the Social and Solidarity Economy in 2015, the Act for the establishment of societal impact companies (sociétés d'impact sociétal - SIS, in French) was introduced in 2016, together with measures to promote this status: an initial incubator to support social entrepreneurs, which became the Maison de l'économie sociale et de l'innovation sociale (MESIS) in 2018 and was renamed the Social Business Incubator in 2022.
Societal impact companies
To encourage the creation of companies rooted in the social and solidarity economy, a specific legal status was launched in 2016: societal impact companies (SIS). Since the status was created, the number of companies has grown considerably: of the 51 entities linked with the social and solidarity economy set up between 2015 and 2020, a total of 25 had SIS status.
Societal impact company status is aimed at both existing companies or organisations and project leaders looking to launch a business with a social or societal objective. Only those companies that comply with the principles of the social and solidarity economy are granted accreditation. The requirements in terms of transparency and governance are strict.
The "Impact Luxembourg – Societal Impact Company" label was launched in October 2022 to help position these companies in Luxembourg's economic network and to distinguish their services from those provided by companies that are not subject to the same legal and tax obligations. The Luxembourg Union for the Social and Solidarity economy (ULESS) is the partner tasked with managing and awarding the label.
Social Business Incubator
A new incubator for societal impact companies, the Social Business Incubator, was established in September 2022. It reflects Luxembourg's ambition to develop the social and solidarity economy as part of its policy of economic diversification. The incubator offers bespoke advice and guidance to meet the needs of project leaders.
These companies work in a wide variety of fields, including education, coaching, housing, magazines, integration and food. Here is a small themed selection to guide you towards societal impact companies that have been awarded the label:
- Business support, coaching, education:
- Luxembourg Center for Circular Economy: offering advice and promoting the circular economy philosophy.
- Nyki: sharing the pleasure of learning and contributing to equal opportunities in education.
- KnowThyBrand: enabling women to build sustainable businesses and career paths.
- A-prendre: French courses for women applying for international protection status.
- Integration:
- Fondation Kraizbierg: a life plan for people with a physical disability.
- Yolande Coop: a working environment for people with an intellectual disability.
- Housing and land use:
- Food:
- Microtarians: converting surplus food into delicious, healthy products.
- Eis Epicerie: a cooperative solidarity grocery store and brasserie that aims to encourage responsible consumption.
- On.perfekt: giving a second chance to vegetables that may look imperfect but still taste just as good.
- Magazines:
Are you looking for a socially responsible company for your purchases or services? We would encourage you to browse through the directory on the dedicated social and solidarity economy portal and to visit the Impact Luxembourg website.
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