What is a CIC?
A community interest company (CIC) is a social business with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or the community, rather than being driven by the need to maximize profit for shareholders and owners.
CICs tackle a wide range of social and environmental issues and operate in all parts of the economy. By using business solutions to achieve public good, it is believed that CICs have a distinct and valuable role to play in helping create a strong, sustainable, and socially inclusive economy.
A CIC must:
- Have a ‘community interest statement’, explaining what the business sets out to do.
- Have an ‘asset lock’- a legal promise stating that the company’s assets will only be used for its social objectives, and set limits on how much it pays shareholders
- Have a constitution, this is set out in our Articles of Association
- CICs or social enterprises should earn at least 50% of their income through trading, rather than through grants or other funding; Pennysmart CIC earns trading income through sales of services, contracts and service level agreements
- CIC’s must be registered and approved by the CIC regulator