British Columbia is setting up a new business model aimed at attracting “socially conscious investors” to make it easier for people to make money and give back to the community. The Community Contribution Company (C3) caps a company’s profit at 40% and the remainder goes to social causes such as homeless shelters and recycling programs. Hence, C3 attempts to combine business and social value to create a profitable business. C3 is modelled from a similar program in the United Kingdom called Community Interest Companies (CICs).
Many claim that this new model has “too many restrictions and can create too much red tape”. Red tape creates barriers to entry for companies and investors. Furthermore, some argue that this new business model may only have a small impact and fail to create more jobs. However, through introducing this new business model, it generates local employment in B.C. and more “economic wealth”. Although only three companies have registered to the C3 program, CICs in UK has more than 6000 companies registered. As this program develops in BC, it is likely to attract more companies to register. Through this, BC will be able to effectively move more capital into important social issues such as unemployment and charity.
Article and image source: