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Financial sustainability of social enterprise in Central and Eastern Europe

Abstract

Recent years have seen a burgeoning interest in social enterprise across Europe. In Central and Eastern European countries, the transition to a market economy stimulated civil society initiatives, and opened new pathways for entrepreneurial initiatives, including the pioneering establishment of the first social enterprises. Eight of the Central and Eastern European countries studied acknowledge the functioning of approximately 24000 social enterprises ‘hidden’ among a variety of existing legal forms, out of which 15172 associations and foundations undertaking some economic activity. Relatively little consideration has been given to the longer-term growth and performance of these hybrid organizational forms. To succeed, these ventures must adhere to both social goals and financial constraints. It implies that common forces from multiple actors - government and other public bodies, banks, corporations, investment funds as well as individuals join efforts. Business failure among social enterprises has been attributed to various difficulties related to size, a lack of resources, and finance and funding issues. It is essential to understand which revenue streams ensure financial sustainability in the case of the social enterprise. This paper analyzes the entrepreneurial dimension of social enterprise activity in eight Central and East European countries: Bulgaria, Croatia, the Czech Republic, Hungary, Poland, Romania, Slovakia, and Slovenia, addressing the question of social enterprise revenue streams. Most social enterprises examined are aware of the need to insure financial stability to their social mission and are actively securing and combining a blend of income streams, in order to avoid overdependence on one source of income and insure sustainability. None of the countries are solely depending on market sources. Research limitations were encountered when analyzing the variety of revenue streams due to the fact that some country reports presented also the dimension of a specific revenue, whereas others do not comprise specific numbers.

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Determinants of Reverse Mortgage Usage in Malaysia

Abstract

This study aims to identify the factors that influence a household’s willingness to use reverse mortgage as a source of supplementary income in old age by adopting the original Theory of Planned Behavior (TPB) and extending it with three other additional constructs. Using a convenience sampling technique, a total of 391 valid questionnaires were used for data analysis. The data analysis was conducted using the SmartPLS software, version 3.2.6. The results suggest that the sense of attachment to a place, attitude, motive of bequest, social influence and perceived ability positively influence a household’s willingness to use reverse mortgage, while financial behavior was found to negatively influence the willingness to do so. The findings of this study extend the application of the TPB to the domain of reverse mortgage product.

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Czech pension reform: how to reconcile equivalence with fiscal discipline

Abstract

One of the recent changes in the Czech Republic’s pension system was provoked by a petition to the Constitutional Court. The setting of bend points for determining the amount of pensions depending on the insured person’s previous earnings was contested as discrimination against higher income categories. The Constitutional Court granted the petition. The result was an approval and implementation of an amendment to Act No. 155/1995 Coll., on Pension Insurance, that for the purposes of calculating the level of old-age pensions favoured the highest income decile at the expense of most other insured persons, namely those with middle incomes. Simultaneously, the political criterion of fiscal discipline was applied to ensure the financial sustainability of the pension system. In analysing this case, we critically adopt the theory of actor-centred institutionalism and the theory of the policy cycle. From the nature of the analysed case it follows that we pay attention mainly to the legislative process which resulted in the amendment. Our methodology is dominated by analysis of documents (legal norms, court decisions, political programmes, official publications) and political and administrative communication (including debates on legislative drafts in the executive and legislature).

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Success Factors of Sustainable Social Enterprises Through Circular Economy Perspective

Abstract

The scope of the research is to find out how social entrepreneurship operations can be modelled within existing business methods using circular economy principles. A literature review was undertaken in order to clarify and find out different opinions regarding circularity and social businesses models. Moreover, the author interviewed managers of different social mission organizations in order to find out the critical factors that determine the sustainability and performances of the organizations. Using the results of the field and desk research, the author suggests the following business model elements to be considered by social enterprises aiming to implement circular economy principles: Desired social and environment vision; Value proposition; Alignment of organizations to the strategy and acceleration of change through executive leadership implication; Financial sustainable perspective: a) to increase financial resources and b) to manage costs; Stakeholders perspective: a) customers segments, b) users, c) employees, d) community beneficiaries, e) channels, f) customer relationships, g) Key partnerships; Internal process perspective: a) processes necessary to use circular economy principles; b) impact measurement and key activities; c) internal and external communication; Resources perspective: a) networks; b) skills on circular principles and social impact; c) information and technologies.`

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Examining Financial Management Practices in the Context of Smart ICT Use: Recent Evidence from Croatian Entrepreneurs

Abstract

Recent research demonstrates that entrepreneurs who learn contribute to lower failure rates of their startups. Nowhere is this more evident than in the area of financial management, where the entrepreneurs’ lack of skills and competencies – and their willingness to acquire them - can be a critical factor to the success of the business venture. The purpose of this paper is to examine the financial management practices among Croatian entrepreneurs in relation to budgeting, raising capital, cash flow management, and the use of ICT tools for enhanced efficiency of their businesses. The survey was conducted on a sample of 58 entrepreneurs whose answers provide valuable insight into their grasp of financial concepts in the context of smart ICT use. The ensuing analysis of the level of proficiency in combining smart tools with financial management reveals increased adoption of ICT practices for budgeting and purchasing among Croatian entrepreneurs. Additionally, the findings indicate that the entrepreneurs’ acquisition of skills and competencies for smart financial management presents a sound basis for increased overall financial sustainability of the startups.

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Biosimilar medical products – licensing, pharmacovigilance and interchangeability

Abstract

The use of biological medicine has significantly increased in recent decades and has made substantial contributions to improving the effectiveness of therapies in many diseases. The expiration of patents of biological innovative medicines enables copies of those drugs called similar biological products (biosimilars) to be approved by regulatory authorities and to enter in clinical use. Biosimilars are comparable but not identical and are not a generic version of the innovator biological product. Although biosimilars undergo rigorous characterization as well as clinical studies to prove their safety and effectiveness, specific regulatory requirements for registration apply in the case of biosimilars. They are highly complex molecules and small changes in the production process can have major implications in its safety and effectiveness profile. The availability of biosimilars enhances competition, with the potential to improve patient access to biological medicines and to contribute to the financial sustainability of healthcare systems. In order to be certain that a biosimilar reaches its potential in clinical use, an intensive pharmacovigilance monitoring system must be established in order to prove the true similarity between the original biologic and its biosimilar. There is a need for further guidance and resolution of the ongoing discussions on biosimilar labelling, naming, pharmacovigilance and substitution in order to ensure effective and appropriate use of biosimilars in clinical practice.

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in PRILOZI
Face To Face Intercultutral Workshops: Are They Worth The Money?

Abstract

A series of two-week international workshops was held in Joensuu, Finland during February 2010, in Glasgow, Scotland in February 2011 and again in Nicosia, Cyprus during February 2012. Entitled “Intercultural Innovation Insight Workshop” (3EYES), they were sponsored by the European Lifelong Learning programme. Students from Portugal, Cyprus, Czech Republic, Finland and the United Kingdom were placed in multi-cultural teams of five. Each team had two product designers, one graphic designer, one financial and one marketing student. They were set the task of devising new product ideas for a local company and they had two weeks within which to do it. These intensive workshops comprised lectures and practical tutorials as well as ideation sessions for the new product ideas and represent one way in which international issues may be appreciated and accommodated. During the first innovation camp the students examined product futures for a fairly large Finnish ceramics company, the Glasgow workshop liaised with a micro-company and during the third 3EYES workshop, the Municipality of Nicosia was helped in its bid to become the European City of Culture 2017. All three events dealt with a completely different clientele: the first was a medium sized company, the second a micro company and the third a Municipal authority. The output of the first two was expected to be a physical product or product idea whereas the third did not need to be a product of any sort. The previous paper, which was delivered in the South African conference last year, compared the first two events and discussed issues of social responsiveness, shared goals and identity. Now that the third (and last) event has taken place, it is time to take stock. We conclude that the students gain greatly from both cultural and functional interaction on a way that cannot be reproduced by means of local teaching. This experience is attitude forming and can transform motivation. It also has the desired effect of increasing the desire to go on Erasmus placements in subsequent years. The perceptions from staff who attended are compared with similar reflections from staff who worked on a different, video conference based, approach. The differences in the financial sustainability of such projects are discussed and the benefits of each model evaluated.

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The Impact of the SME Financing by MFIs in Albania

References Zeller, M., & Meyer, R. (2002). Improving the performance of microfinance: Financial sustainability, outreach and impact, in: Zeller, M. & Meyer, R. L.: The triangle of microfinance. Baltimore: The Johns Hopkins University Press. Newsletters, annual reports 2009-2014 of IMF’s in Albania Annual Reports of the Bank of Albania Yunus, M. (1984) “Group based Savings and credit of the Rural Poor: The Grameen Bank in Bangladesh”, In ILO (ed) Group based Savings and credit of the Rural Poor

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The Financial Performance of MFIs in Albania

. Designing Eff ective Performance Measurement Systems under the Government Performance and Results Act of 1993 . Public Administration Review 39 ( 2 ): 348 - 58 . Hermes, N., Lensink, R., & Meesters, A. (2011), Outreach and efficiency of microfinance institutions. World Development, 39(6), 938-948. Zeller, M., & Meyer, R. (2002). Improving the performance of microfinance: Financial sustainability, outreach and impact, in: Zeller, M. & Meyer, R. L.: The triangle of microfinance. Baltimore: The Johns Hopkins University Press

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Group Lending Model - A Panacea to Reduce Transaction Cost?

?05.02.02/2014-15 Sahasranaman A. and George, D. 2013). Cost of Delivering Rural Credit in India. IFMR Finance Foundation Shankar S. 2006. Transaction cost in group micro credit in India: case studies of the micro finance institutions. IFMR, Centre for Micro Finance, Working Paper Series. Sharma, S. et. al. 2016. Financial Sustainability and Outreach: Performance of Microfinance Institutions in India. Journal of the Centre for Research on Financial Inclusion and Microfinance. The Microfinance Review. Vol. VIII. No.2 Smartcampaign. Smart Lending

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