Type of business
|national and local government industries and service providers
||working for the greater good of everybody in the country – local and
||Led by national and local politicians, managed by central and local
|transnational corporations (TNC) through to small and medium sized,
local enterprises (SME)
||capitalist enterprises making profit for their shareholders
||Led by capitalists and managed by entrepreneurs
|community organisations and businesses
||working for the greater good of local communities and marginalized
||Led and managed by people in the locality
Recent history has shown the collapse of the communist system where the public
sector was huge and the private sector was wiped out.
Many governments still operate a socialist, mixed economy system. The idea is to
have a good balance between the public and private sectors. The government owns
some of the key industries and services and makes rules and regulations about
how the private sector should operate the rest. Many governments have a Welfare
System which meets the needs of the most vulnerable members of society.
Since the 1970s we have seen an expansion of the free market capitalist system.
This has involved a gradual withering of the public sector (through
privatisation and deregulation ) and the expansion of the private sector
(through globalisation and de-nationalisation)
None of these grand theories paid much attention to the social sector and the
social economy. But it existed and was significant in the lives of ordinary
people. It is, and always has been, huge. The difference these days is that its
importance has been recognised and the politicians now want to make better use
Note that there is an increasing awareness of the triple bottom line. This means
that organisations should be judged not just by how much profit they make for
their stakeholders but also by the social and environmental consequences of what
they do. Ways have been developed for doing social audits and environmental
audits of organisations. This links to ideas about ethical investment.