The Regulation put forward by the European Commission aims to stimulate the financing of social business, i.e. companies whose corporate objectives go beyond maximising profits and also have the achievement of positive social impact within their core business. The measures to be put in place aim to increase the transparency of the information received by investors in order to stimulate funding to these type of projects.

Among the measures proposed by the European Commission in order to encourage social entrepreneurship, the proposed Regulation foresees the creation of a European label to identify social venture funds. The new "European Social Entrepreneurship Funds" label will allow these kind of funds to be differentiated from funds of a different nature, allowing investors to identify them more easily.

In order to get this label fund managers will have certify that at least 70% of the capital received by investors is focused on supporting social businesses, and will also have to ensure the good conduct of the managers. The absence of conflicts of interest will also be considered as well as the sustainability of organizational arrangements. The new framework will not be mandatory for fund raisers, however, funds holding the label will be entitle to operate and raise funds across Europe. On the other hand, as soon as these requirements are no longer met Member states authorities may withdraw the distinction.

In order to improve transparency and facilitate investors' access to necessary information, funds holding the European label will have to publish their data. The regulation also includes a series of measures to monitor and measure the social impact of such projects. This will improve the capacity of investors to choose among the projects. However, given the complexity of this instrument, the label will only be available for professional investors in a first stage. The Commission will later consider a future opening to retail investors.

Social enterprises currently account for about 10% of European businesses and employ about eleven million workers. As part of the twelve projects to enhance the European Single Market proposed by the Commission, this new proposal aims to exploit this potential for social enterprises to create wealth in a sustainable manner, by improving their access to finance.