Motivation Romania

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Motivation Romania Foundation and Motivation SRL

Motivation Romania Foundation is a non-governmental organisation established in 1995 and registered under Government Ordinance 37/2003, whilst Motivation SRL is a limited liability company owned by Motivation Romania, that was established in 2001 to generate revenue to support social services provided by its sole shareholder, Motivation Romania Foundation. 30% of the employees are people with disabilities. Motivation SRL therefore has a certificate as a sheltered unit provided by the National Authority for People with Disabilities. In 2012, the Foundation had 102 employees (12 disabled) and the SRL 27 (8 disabled). It supports people with disabilities through three programmes:

  1. Peer Group Training and Wheelchairs: an intensive training programme for new wheelchair users;
  2. Employment of People with Mobility Disabilities: promotes the employment of people with disabilities by providing them and their employers with training and support;
  3. Community care services for Children with Severe Disabilities: aims to develop community-based alternatives to the institutionalisation of children with physical disabilities.

Motivation SRL obtained the following economic results:

  • sales growth of close to 600% from 2002 to 2006
  • profit for the year 2011 (€123 000) which is double the profit of the previous year

Moreover, it obtained ISO 9001 certification and included business and non-profit partners in the financing of its activity.

Policy lessons

Motivation Romania, a Foundation undertaking a successful social enterprise activity, highlights how a social enterprise can adapt to an underdeveloped regulatory environment given appropriate policy support. Motivation Romania Foundation undertakes significant activities with disabled people. It receives over half of its funding (as of 2010) from the European Social Fund and also receives support from charities, trusts and the private sector.

The Foundation also initiated a social enterprise, Motivation SRL, which makes wheelchairs in order to support the long-term sustainability of the organisation. The creation of Motivation SRL as a social enterprise is closely linked to the changes in the general framework of the Romanian market of disability medical equipment. In 2001, new laws were enacted to liberalise the market and the decision to allow a wide range of disability mobility equipment manufacturers to obtain accreditation from the National Health Insurance Company (NHIC). At the same time, the Romanian Government passed new laws allowing sheltered workshops to receive funds from NHIC, provided that they were accredited by NHIC and registered as separate, for profit companies. However, a common legal framework is applied to both civil society organisations and for profit commercial activities in Romania, and this penalises the commercial activities undertaken by the social enterprise. Thus Motivation SRL is not tax-exempt, and pays all taxes that apply to Romanian businesses, including VAT (rate of 19%); profit tax at a rate of 16%; dividend tax applied to net profits distributed to shareholders (the rate is 10% for legal entities and 16% for individual shareholders); and employment taxes, including income tax, social insurance, unemployment, etc.

Source: OECD Policy Brief on Social Entrepreneurship, May 2103: http://ec.europa.eu/social/main.jsp?catId=738&langId=en&pubId=7552

Website: http://www.motivation.ro