Developing Scotland's Economy: Increasing The Role Of Inclusive And Democratic Business Models

1. Introduction

1.1 This independent review was announced in the National Strategy for Economic Transformation (NSET) (Scottish Government, 2022) which committed to ‘undertake and publish a review of how best to significantly increase the number of social enterprises, employee-owned businesses and co-operatives in Scotland, supporting regional regeneration and the wealth of local communities’. This is important as these forms of enterprise are part of building economic democracy^[1] and are central to achieving more and sustainable social benefits, stronger productivity, and a more prosperous, innovative and dynamic economy.

1.2 This report and the recommendations draw on the extensive knowledge, experience, deliberations, and discussions of the Review Group, chaired by Neil McInroy, Global Lead for Community Wealth Building (CWB), The Democracy Collaborative and Chair of Economic Development Association Scotland. Members (see Annex A) of the Group have been at the forefront of supporting, delivering, and operating Inclusive and Democratic Business Models (IDBMs)^[2] in Scotland for a number of years.

1.3 The Review Group identified four key areas of focus. These reflect the crucial aspects to support an increase in the number of IDBMs across all types in Scotland:

• Culture, Context and Awareness of IDBMs.
• Training, Advice and Support.
• Finance and Funding.
• Policy and Legislation.

1.4 By reviewing the progress made in supporting IDBMs, opportunities for change have been identified. A number of the recommendations are directed at supporting and augmenting existing activity and can be adopted in the short term. Other recommendations are more radical, longer term and will require additional work and development. Furthermore, a number of recommendations play directly into the proposed CWB, and Wellbeing and Sustainability legislation and Democracy Matters consultations, offering opportunities for advancing IDBMs and economic democracy.

1.5 The recommendations in this review aim to address the identified challenges and take action that will both accelerate the growth and sustainability of enterprises currently operating in our economy and support the creation of new businesses and enterprises in the future, while providing wider social, economic and environmental benefits which support the achievement of a prosperous, innovative and dynamic economy that delivers wellbeing.