Key terms

A Memorandum of Understanding (MOU) is a written agreement that sets out how two or more organisations plan to work together.

An MOU is often used when organisations want to collaborate on a shared project, partnership or piece of work, but do not need a formal legal contract. It can outline shared goals, roles and responsibilities, timelines, decision-making, and how the partnership will be managed.

In the social enterprise sector, MOUs are commonly used when organisations are working together across community, government, philanthropy or business. They can help create clarity early on, especially when testing a new partnership, delivering a joint initiative, or working across different parts of the ecosystem.

An MOU is usually not legally binding, but it can still be an important tool for building trust, setting expectations and supporting more effective collaboration.

An experienced and trusted advisor who provides guidance, support, and encouragement. They can also act as a role model, sounding board, and source of constructive feedback.

The established set of attitudes, beliefs, and assumptions held by an individual or group that shape their perspective, decision-making, and actions. Mindsets influence how people interpret and respond to situations, and they can be positive, negative, or neutral.

Mission fidelity means staying true to the core purpose or goals of an organisation, especially its commitment to creating positive impact. It’s about consistently focusing on the mission, even as the organisation grows or faces challenges, ensuring that actions and decisions align with its intended impact.

A concise explanation of an organisation's reason for existence, describing what it does and for whom.

The Modified Monash Model (MMM) is an Australian government classification system. It categorises locations across Australia based on how remote they are and how large the local population is. The scale runs from MM1, which covers major cities, to MM7, which covers very remote areas.

The MMM was developed by the Australian Department of Health and Ageing. It was designed to better target health workforce programs and attract doctors, nurses, and allied health workers to areas where they are most needed. The model combines two factors: how geographically isolated a place is, as measured by the Australian Bureau of Statistics (ABS), and the size of the town or community. It is reviewed and updated after each national Census, which runs every five years.

In practice, the MMM shapes where government funding, incentives, and services can be directed. Areas classified MM2 to MM7 are considered regional, rural, or remote. People in these locations often face longer travel times and fewer choices when accessing health and community services. The MMM is used to determine eligibility for a range of programs, including rural bulk billing incentives, the Workforce Incentive Program, and Distribution Priority Areas (DPA). It also affects how NDIS providers can claim travel time and costs when delivering supports in regional and remote communities.

For social enterprises working in health, disability, aged care, or community services, understanding a location's MMM classification can matter a great deal. It can affect what funding is available, what government contracts are accessible, and what additional costs must be factored into service delivery. Social enterprises operating in higher MMM categories (such as MM4, MM5, MM6, or MM7) often face real challenges around staffing, logistics, and financial sustainability. At the same time, these are often the communities with the greatest unmet need, and where a well-run social enterprise can have outsized impact. For First Nations communities, which are disproportionately located in higher MMM categories, these challenges are compounded by historical underinvestment and the importance of culturally safe service delivery.

Monitoring and Evaluation (M&E) is a systematic process of collecting and analysing data to assess the effectiveness and impact of any given intervention. M&E is often based on an intervention’s impact model. The role of learning is increasingly being elevated in M&E practice (often changing the acronym to MEL, with the ‘L’ being for ‘learning’) to reflect the idea that M&E should be developmental alongside enabling accountability.

The National Disability Insurance Scheme (NDIS) is an Australian government program that funds support for people with permanent and significant disability. It is one of the largest social policy reforms in Australia's history.

The NDIS is administered by the National Disability Insurance Agency (NDIA). It works by giving eligible participants an individual funding plan. This plan is based on their goals, needs, and circumstances. Participants can then use their plan funding to purchase supports and services from registered or unregistered providers. These supports cover a wide range of needs, including daily living, employment, education, transport, assistive technology, and community participation. The NDIS is funded jointly by the Australian federal and state and territory governments.

For social enterprises, the NDIS represents both a significant market and a mission-aligned opportunity. Social enterprises working in disability employment, community participation, allied health, supported accommodation, or daily living support can register as NDIS providers and deliver funded services. Some social enterprises also employ people with disability as part of their core workforce, and the NDIS may fund supports that help those employees participate fully in the workplace. The scheme has created new revenue pathways for organisations that previously relied on grants or philanthropy.

There are important things to understand before entering the NDIS market. Registration requirements, compliance obligations, and pricing rules set by the NDIA can be complex and time-consuming to navigate. The NDIS Price Guide sets the maximum prices providers can charge for most supports, which can make financial sustainability difficult, particularly for smaller organisations or those working in regional and remote areas where costs are higher. Social enterprises operating under a higher Modified Monash Model (MMM) classification may be able to claim additional travel time and costs, but this requires careful planning and administration. It is also worth noting that the NDIS has faced significant scrutiny and ongoing reform. Staying across changes to the scheme is important for any organisation delivering NDIS-funded services.

Collaborative projects and alliances that bring together multiple stakeholders around shared interests, learning inquiries, and to address specific social, environmental, or organisational challenges.

A member of an organisation's board of directors who is not part of the executive management team, providing independent oversight and strategic guidance.

The regulator of Indigenous corporations registered under the CATSI Act. It supports and regulates corporations to ensure they comply with the law.

The Open Learning community is a space where knowledge, stories, skills and experience from other SEDI learning communities, and from the wider social enterprise community, are shared through online events and forums, open to all. Social Enterprise Australia will commission and co-produce online events and forums of shared value and interest to the Sector. Key attributes of the Open Learning community include: -Engaging diverse sector perspectives including those that are under-represented in the sector. -Sharing knowledge and practice in various interactive formats (eg. online workshops, storycircles, panel discussions, curious conversations, Q&As, and other forums) -Growing connections, practices and leadership that enable people and the planet to thrive. -Being open to all to engage, explore, and learn. -Guided by key topics and themes identified by the Sector.

The framework that defines the hierarchy and flow of activities within an organisation, including roles, responsibilities, and communication channels.

The short-term, medium-term, and long-term effects or changes that result from an organisation's activities, such as improvements in participants' knowledge, skills, or well-being.

The direct, tangible products or services resulting from an organisation's activities, such as the number of workshops delivered or people served.

The costs of running an organisation, including fixed and variable expenses.

Payment by Outcomes (PBO) is a form of investing to help address long-standing social issues. PBO trials are designed to test the effectiveness of these investing contracts. How it works The government has committed $15.7 million from 2019-20 to 2026-27 to co-develop, implement and evaluate 3 PBO Trials in the social services sector. PBO is a form of social impact investing (SII) contract, between a funder and service provider. In the PBO Trials, the contract funder is the government. In the PBO Trial contracts, service providers are paid part of the contract fees upfront and part on achievement of agreed outcomes. This means the service provider takes on more of the risk for achieving the outcomes than under a traditional grant arrangement. The objectives of the PBO Trials are to inform: -the appropriateness and efficiency of PBO contracts -how to improve the design and use of robust outcome measurement -whether PBO contracts are suitable funding tools in social services -whether the policy focus areas tested are suitable for PBO contracts. The learnings will inform future potential funding arrangements and community sector reform. The 3 PBO Trials were co-developed and are being implemented and evaluated with service provider partners.

A funding model where an organisation receives payment based on the measurable results or outcomes they achieve, rather than just the activities or services they provide. This approach ties funding to the demonstrable impact of an intervention and relies on mutually agreed measurement frameworks between organisations delivering outcomes and those who want to purchase them.

National or regional associations that represent and advocate for the interests of social enterprises and the broader sector. Peak bodies may be governed by their members and also provide networking activities, capacity building, and events.

These communities invite people to engage around topics of social enterprise interest and impact. Participants help and support each other through building relationships, nurturing ideas, and sharing learning. These communities create connection opportunities for individuals with different levels of experience in the social enterprise space including those who may not see themselves as experienced practitioners but have learnings to share which can inform Sector development and growth. Key attributes of Peer Learning and Support communities are that they: -Focus on places or themes of social enterprise interest and/or impact. -Convene meet-ups (online) to connect and share experiences. -Explore and exchange ideas. -Organise knowledge-sharing events. -Share updates on planned and delivered activities. -Monitor how active, responsive, and valuable the community is to participants.

People and Planet First is a verification and a global collective. There are millions of enterprises around the world choosing to prioritise people and the planet over profit maximisation. The full scale of this movement can be difficult to see because it emerged bottom-up. Different terminology is used in different networks, regions, and sectors. People and Planet First verification bridges these divides. It includes all enterprises that meet 5 standards.

The ongoing process of setting goals, monitoring progress, providing feedback, and making adjustments to ensure an organisation achieves its desired outcomes effectively and efficiently.

A strategic planning tool used to evaluate the external factors that can influence an organisation, project, or decision. PESTLE is an acronym that stands for Political, Economic, Social, Technological, Legal, and Environmental factors. By examining these areas, organisations can gain a comprehensive understanding of the opportunities and challenges they face and develop more informed strategies.

Foundations, trusts, and individual donors that provide grants and donations to support social causes.

Conducting small-scale, practical tests to gather feedback and make necessary adjustments before a full-scale launch of a project or enterprise.

A short presentation designed to inform an audience about a business and inspire a specific action, such as investment or sales.

An approach that is grounded in a specific community, geography, and cultural context. In First Nations settings, this recognises the deep connection to Country and ensures that solutions are tailored to local realities rather than applied as one-size-fits-all models.

Official documents that outline how the organisation will act, such as Health and Safety, Safeguarding, and Equal Opportunities policies.

A person who regularly applies their skills, knowledge, and expertise in a particular field or profession to carry out specific tasks, provide services, or solve problems.

A common legal structure for for-profit businesses in Australia. It has limited liability for its shareholders and cannot raise funds from the public.

Firms and consultants that offer specialised support to social enterprises, such as legal advice, accounting, marketing, and impact measurement.

The money remaining after all expenses, including owner compensation, have been paid.

A financial statement showing income earned and expenses incurred over a year, revealing the profit (surplus) or loss (deficit) for that period.

Social enterprises reinvest the majority of their profits back into their social or environmental mission, rather than distributing them to shareholders or owners.

A type of charitable organisation that is instituted to provide direct relief to a disadvantaged section of the public. PBIs are eligible for certain tax concessions.

A company structure that allows the company to raise funds from the public by issuing shares. It can be listed on a stock exchange.

Investments that typically involve the provision of capital that is structured as a loan, but with some equity-like characteristics, such as flexible repayment terms, performance-based returns, or the option to convert the loan into ownership shares. The goal of quasi-equity is to provide growth capital to businesses or projects that may not qualify for traditional loans or equity investments, while balancing the risks and rewards for both the investor and the recipient. Quasi-equity can be a risk capital alternative to equity financing for non-profits.

The minimum number of people required to be present at a meeting before it can officially begin and decisions can be made, as specified in the governing document.

Vocational training entities that provide applied learning and skills development programs for social enterprise practitioners and stakeholders.

A body corporate formed or incorporated under the law of a state or territory that carries on business outside its place of origin. It must be registered under the Corporations Act 2001 (Cth) to operate interstate.

A way of working that prioritises relationships, trust, and accountability over transactional or purely outcome-driven approaches. It acknowledges that meaningful outcomes - particularly in First Nations contexts - are built through connection, consistency, and respect over time.

Academic units and think tanks that conduct studies and critical analysis on social enterprise trends, practices, and impacts.

Funds an organisation has available to freely spend, excluding restricted income, endowment funds, and tangible fixed assets held for the organisation's own use.

Funds, often provided through grants, that can only be used for a specific purpose or project and cannot be used for other purposes.

The total income generated by an organisation, before expenses are deducted.

The possibility of something bad or undesirable happening. It refers to the uncertainty that an event or action may lead to a loss, harm, or negative consequence. In a business or organisational context, risks can come from various sources, such as financial, operational, legal, or reputational factors.

The process of identifying, assessing, and prioritising potential risks, followed by planning and implementing strategies to manage or mitigate their impact. This involves developing contingency plans, allocating resources, and monitoring ongoing risks.

A document that plays a key role in risk management, helping track issues and address problems as they arise.

The process of increasing the reach and impact of a social enterprise, which may involve expanding geographically, serving more beneficiaries, developing new products or services, or influencing policy and legislation.

The right of First Nations peoples to make decisions about their own lives, communities, and futures across social, cultural, political, and economic domains. It is a foundational principle underpinning all First Nations-led work and aligns with frameworks such as United Nations declarations on Indigenous rights.