This Guide is an overview of the Swiss legal framework, which intends to help social entrepreneurs and philanthropists to select the most appropriate legal structure for their venture. The Guide is designed to clarify the existing options for setting up a charity or a social enterprise in Switzerland and the important strategic considerations related thereto. It covers the legal vehicles used by both non-profit (charitable) organisations and/or socially driven businesses, and it explores new ways of doing business, as the boundaries of non-profits and for-profit businesses tend to disappear.
For many social entrepreneurs, generating revenue (even outside of profit maximization) from their enterprises is a key driver, ensuring financial sustainability, generating returns for investors and avoiding the need to rely on charitable donations or grants. On the other hand, other entrepreneurs wish to pursue a mission solely focused on the promotion of public utility purposes and, when possible, benefit from related tax exemptions.
Swiss Law does not provide for legal entities specially designed for social ventures, but almost every type of organisation may serve this purpose, each with advantages and disadvantages that this guide tries to highlight.
The Guide contains a decision tree, which is intended to be a starting point to assist philanthropists and social entrepreneurs in selecting the most appropriate legal structure for their organisation. It also contains a general introduction to tax exemption that may apply for social ventures that are for the public benefit. Finally, it describes each legal form in detail and provides for its advantages and disadvantages, as well as case studies.