For Purpose

Cooperatives and mutuals are member-owned businesses focused on benefiting their members. Their primary goal is to create and return value to members rather than generate profits for external investors.

Cooperatives and mutuals can be:

• Customer-owned: Owned and controlled by customers who purchase goods or services commonly found in the retail, wholesale, housing, motoring and insurance sectors. Examples include Australian Unity, HCF Health Fund, and NRMA.
• Employee-owned: Owned and governed by employees, increasingly common in professional services. Examples include Earthworker Energy, Redgum Cleaning Co-operative, and SGS Economics & Planning.
• Producer-owned: Owned and controlled by producers who collectively process and market their products, often in agriculture. Examples include CBH Group and Almondco Australia.

The Business Council of Cooperatives & Mutuals (BCCM) represents their interests in Australia. According to BCCM's Mutual Economy Report, cooperatives and mutuals generate over $30 billion in revenues and employ more than 70,000 Australians.

Industry associations give a collective voice to individual members within an industry or profession. They promote member engagement and offer various services, including advocacy, information, training, accreditation, and networking opportunities.

Industry and professional associations are usually not-for-profit organisations. According to IBISWorld, over 3,000 such associations in Australia generate around $4.4 billion in revenue and employ nearly 22,000 workers.

Larger industry associations include the Australian Industry Group and the Housing Industry Association, while notable professional associations include CPA Australia and Engineers Australia.

These associations have recently diversified their revenue sources, shifting from membership fees to market intelligence and data analysis services. Changing member expectations and technological advancements have driven the adoption of new business models and digital offerings.

Social enterprises are businesses that address social and environmental issues through trade. Although they have no specific legal structure, they are driven by community causes, earn most of their income from business activities, and reinvest profits to support their social missions.

According to Social Enterprise Australia, there are over 12,000 social enterprises in Australia, employing more than 200,000 people and contributing $21.3 billion to the economy each year.

Social enterprises operate across various sectors, including facilities management, catering, hospitality, business administration, and design.

There are three main social enterprise models:

1. Employment-generating: Creates jobs and training for marginalised groups, such as young people, people with disabilities, and survivors of domestic violence.
2. Community need: Provides accessible products and services for community needs not addressed by the market, such as disability housing and aged care services.
3. Profit redistribution: Donates at least 50% of profits or revenue to charity.

A not-for-profit (NFP) organisation operates to further its mission rather than for profit or personal gain. NFPs are registered with the Australian Charities and Not-for-Profits Commission and may have Deductible Gift Recipient (DGR) status from the Australian Taxation Office.

According to the Commission, Australia has over 60,000 registered charities that generate $190 billion in revenue and employ 1.4 million workers and 3.2 million volunteers. Notably, two-thirds of these charities are small, with revenues under $1 million.

Common activities among larger charities include human services, education (e.g., Catholic Schools), and health (e.g., Uniting Care), while high-volunteer charities include Surf Life Saving Australia and Clean Up Australia.

Impact investors include individuals, companies, and investment funds that invest in the For Purpose Sector to achieve social, economic, and environmental impact alongside financial returns.

Larger impact investors, such as superannuation funds and institutional fund managers, aim to enhance the impact of the For Purpose Sector through their investees.

A key debate in the impact investment community focuses on how investment styles (passive vs. active) affect the level of impact generated. Even passive investors contribute by providing funding that the For Purpose Sector may struggle to secure or by accepting lower financial returns than the market offers.