MaGIC SE unveils legal compass for social enterprises

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MaGIC Social Entrepreneurship (MaGIC SE) launched the Legal Compass for Social Enterprises (Legal Compass): a handbook that provides legal guidance on the practices of Social Entrepreneurship in Malaysia.

Khairy Jamaluddin, Minister of Youth and Sports graced the launch of the Legal Compass accompanied by Ashran Datuk Ghazi, Chief Executive Officer of MaGIC and Ehon Chan, Vice President, MaGIC Social Entrepreneurship.

The social entrepreneurship sector in Malaysia is still in the early development phase and one of the challenges faced by social enterprises in Malaysia is the lack of legal recognition and proper policy structure for running a social enterprise.

While MaGIC SE is working with policy makers and the government to affect systemic changes, social entrepreneurs must familiarize themselves and comply with existing legal framework for establishing and running a social enterprise as well as working with specific groups of people such as the underserved communities, people with disabilities and refugees.

The Legal Compass aims to further enhance social entrepreneurs with knowledge on the necessary governance requirements, structure options and other key operations related matters. There are seven subjects highlighted in the guidebook including; Choosing a legal structure: Private company, society, trust, partnership, Employer obligations: Employment Act, Employees Provident Fund, Employees Social Security Act, Minimum Wage Policy as well as Handling Hiring: Malaysian nationals, Personal Data Protection Act, among others.

The launch of the Legal Compass is in line with the three-year plan outlined in the Malaysian Social Enterprise Blueprint 2015-2018, which published by MaGIC SE and launched in 2015. The blueprint identified three main building blocks in social entrepreneurship; social enterprises and social entrepreneurs, the ecosystem itself and institutions including public and private players.

“We are happy to have YB Khairy Jamaludin launch the Legal Compass for Social Enterprises, which is the second book we published after the MaGIC Social Entrepreneurship 101 guide. As we know, there is no legal recognition for social enterprises right now and information such as legal structure relevant for social enterprises is fragmented. There is also a lot of grey area especially legal compliance for working with certain underserved communities such as refugees and people with disabilities.

While we work with our stakeholders and policy makers to effect policy changes, we hope this publication will provide social entrepreneurs the info they need to navigate the legal system and highlight the need for policies to support social enterprises,” said Ashran Dato’ Ghazi, Chief Executive Officer of MaGIC.

“The process to put together the Legal Compass involved the setting up of two steering committees made up of lawyers from four (4) legal firms and five (5) social enterprises. The committees then participated in several round tables to discuss the common legal and compliance pitfalls and challenges faced by social enterprises such as company structure and business operations, intellectual property, employer and employee obligations as well as policies when working with specific groups.

With this concise and easy-to-read handbook, we hope to mitigate the risk of legal non-compliance faced by social enterprises as they engage in commercial activities to sustain their operations and increase impact on the society and environment” added Ehon Chan, Vice President of MaGIC Social Entrepreneurship.

The four (4) legal firms involved in putting together the Legal Compass are; MahWengKwai & Associates, Zain & Co, Chooi & Company and Zaid Ibrahim & Co and the five (5) Social Enterprises that contributed to the steering committee are Biji-biji Designs Sdn Bhd, 100% Project, Kakiseni, Mangochilli and The Nasi Lemak Project.

MaGIC Social Entrepreneurship has been mandated to spearhead the growth of the nation’s social enterprise sector through a strategic and pragmatic approach. It is the role of MaGIC Social Entrepreneurship to build cross-sector partnerships which would tap into the strengths and resources of each sector, which would in turn spur growth of social entrepreneurship in Malaysia.

MaGIC Social Entrepreneurship would also be coordinating the development of the sector through various programs and collaborations between public, private and social sectors.

For more information on MaGIC SE, please refer to http://www.mymagic.my/se/ and to download the Legal Compass for Social Enterprises, please refer to http://se.mymagic.my/en/publications/my/se/

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