The Landscape of Belgian Impact Businesses

Sustainable Development Goal(s): 8. Decent work and economic growth9. Innovation and infrastructure11. Sustainable cities and communities12. Responsible consumption and production

Priorities for change:
The Landscape of Belgian Impact Businesses
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Just like a lot of things in our country, the Belgian business landscape is atypical in comparison to other European countries. It mainly consists of small- and medium-sized family businesses (ref). This phenomenon is enhanced by the fact that only a limited number of Belgian companies are listed on the stock exchange, with 111 companies listed in 2018. For comparison, the world average in 2018 based on 70 countries was 597 companies (ref).

Depending on how Belgian companies combine profit and purpose into their business activities, we can categorise them on an axis. On the one end of the spectrum, there are the pure non-profit organisations that rely on subsidies and gifts. On the other, the pure for-profit companies, whose sole purpose it is to maximise the profit for their shareholders. For a long time, there was an absolute division between these two extremes, but now more and more companies are starting to combine profit and purpose, not only in Belgium but around the world. The main reason? Our world is being confronted with a cascade of crises (climate change, the COVID pandemic, growing income inequality) and businesses are starting to understand the pivotal role they have to play in averting the greatest disasters. With the SDGs as their guide, for-profit companies are thus increasingly taking into account their societal impact and ensuring that it’s positive. This has resulted in a paradigm shift, which translates into an increase in the number of so-called hybrid companies and a reduction in pure non-profits and for-profits (ref). 

This results in a diverse landscape of Belgian impact businesses. There are the non-profits that mainly focus on social impact, but also conduct some income generating market-activites. There are “Social Enterprises” that prioritise the social impact of their company over the profit of their investors, but have a limited financial return as well. Next, there are “Socially Responsible Companies”, which are for-profit companies that also aim to positively impact society through their activities. Then, there are those for-profit companies that mainly focus on their own market activities, but also try to have a positive impact through the financing of CSR projects (ref). 

Both the Social Enterprise and the Socially Responsible Company are what Marleen Denef from Impact Advocaten calls “hybrids”. These hybrids are what our country, and the rest of the world, needs if we want to bolster our societies against current and future crises because they carry out impact projects and bring about social innovation (ref). 

With the B Corp label on the rise in our country, Belgian for-profit companies can translate this new form of doing business into something tangible that shows investors and consumers that they are using business as a force for good and encourages other companies to do the same. This reinforces the idea that doing good for the world and doing good in business does not have to be mutually exclusive!

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