Building on its existing initiatives in Ukraine and to further describe and develop the country’s social entrepreneurship ecosystem, Pact’s expert team conducted an Applied Political Economy Analysis from February to June 2018 to understand formal and informal incentives and barriers as they are seen by key actors, including social entrepreneurs, incubators and accelerators, and financial institutions. The report, “Social Entrepreneurship Ecosystem in Ukraine: Challenges and Opportunities,” is available for download.
The study found that the establishment and development of social enterprises in Ukraine often hinges on an NGO’s provision of support for social problems—such as unemployment, inclusion of vulnerable populations, social protection, and health issues—that the state is unable to tackle. And while social enterprise incubators and accelerators have emerged from donor projects, there is potential for higher education institutions to serve in that role. Interest in funding social businesses is growing in Ukraine and crowdsourcing is on the rise, yet there are a number of barriers that prevent the development of social enterprise. Aside from organizational shortcomings, external factors including a poor legal framework, corruption, donor limitations and saturation, along with insufficient access to financial resources, all frustrate social entrepreneurship initiatives.
The authors of “The Social Entrepreneurship Ecosystem in Ukraine: Challenges and Opportunities” conclude by noting the wealth of opportunities existing for new and existing actors; calling for a platform designed to ensure regular communication and networking, training, and experience-sharing between different actors; and establishing interaction with the business community. With greater attention to impact metrics and measurement of social enterprises, the social return of the initiatives will become more visible, attracting and justifying greater investment. Social entrepreneurship stands to help ameliorate the country’s paternalist perception of social problems while engaging citizens and businesses to interact more actively with the government and civil society.