See discussions, stats, and author profiles for this publication at: https://www.researchgate.

net/publication/257542034

Social Entrepreneurship in Theory and Practice—An Introduction

Article  in  Journal of Business Ethics · December 2012

CITATIONS READS

89 1,381

1 author:

Nicola Pless
University of South Australia, Adelaide, Australia
65 PUBLICATIONS   2,547 CITATIONS   

SEE PROFILE

Some of the authors of this publication are also working on these related projects:

Journal of Business Ethics View project

All content following this page was uploaded by Nicola Pless on 05 December 2014.

The user has requested enhancement of the downloaded file.

Social Entrepreneurship in Theory

Published online: 21 November 2012

The field of social entrepreneurship has grown exponen- social needs.’ Their definition moves beyond the initially
tially in recent years and has become a social, economic dominating stream of research on social entrepreneurs and
and cultural phenomenon. In light of the current economic the personalities, qualities, values and visions of individual
crisis, the inability of some governments to meet the social change agents (Bornstein 2004). While these often powerful
needs of their constituencies, a widening gap between rich and inspiring stories help to popularise the field and continue
and poor in many developed countries, and—for many—a to inspire, scholars have lately called for a broader, and at the
less than appealing, scandal-ridden corporate world, the same time, more focused approach. Short et al. (2009) con-
stories of individuals and groups of individuals who want ducted an in-depth review of the social entrepreneurship field
‘to change the world’ (Bornstein 2004) are inspiring. The and found only ‘152 relevant articles’. They concluded that
examples of dedicated and visionary entrepreneurs who to establish a more unified terminology, researchers should
design solutions for unmet social needs, and whose primary embrace key themes in strategic entrepreneurship—such as
intention is to help others, are a source of hope in markets contingency theory, discovery theory and resource depen-
where traditional forms of capitalism are struggling to dency theory. Dacin et al. (2011) suggested five avenues of
rebuild their reputation and legitimacy. ‘theory building at varying levels of analysis: institutions and
From a research perspective, Dacin et al. (2011) offer a social movements, networks, culture, identity and image and
more muted reception for social entrepreneurship. As cognition’ (p. 1211) and emphasised the importance of
increasing numbers of researchers venture into the intrigu- context and outcomes. In particular, Dacin et al. emphasised
ing, interdisciplinary context of social entrepreneurship, the relevance of social processes in the pursuit of social
‘researchers continue to struggle to delineate boundaries of entrepreneurship. They located existing research in four key
the field and to arrive at a set of relevant and meaningful areas: (1) the characteristics of individual social entrepre-
research questions’ (p. 1203). As a consequence, social neurs; (2) their sphere of operation and the social needs and
entrepreneurship research is still in an embryonic state and a constituencies targeted; (3) the processes and resources
unified definition is missing (Short et al. 2009, p. 161). used—it is in this area where core research questions are
However, the most scholars agree that a broad definition identified and (4) the mission of the social entrepreneur/
should be adopted given the cross-sectoral and interdisci- enterprise.
plinary nature of the social entrepreneurship field. In an early This Special Issue—the first of its kind in the Journal of
attempt to bring structure in a nascent field, Mair and Marti Business Ethics—seeks to advance the discourse on, and
(2006, p. 37) define social entrepreneurship ‘as a process theory building in, social entrepreneurship. With few
involving the innovative use and combination of resources to exceptions (e.g. Koe and Shamuganathan 2010; VanSandt
pursue opportunities to catalyse social change and/or address et al. 2009; Murphy and Coombes 2009; Sud et al. 2009)
social entrepreneurship has yet to be embraced as a
research domain in this journal. By assembling some of the
N. M. Pless (&)
leading scholars in the field, the Special Issue aims to
ESADE Business School, Ramon Llull University,
Sant Cugat, Spain encourage more relevant research and enhance the under-
e-mail: [email protected] standing of social entrepreneurship and its ethical, social

123
318 N. M. Pless

and contextual implications. The scope of contributions is empathy and problem-solving skills; making performance
broad and paradigmatic in nature, touching on all the key information more visible and accessible; making ‘smart
areas identified above. Moreover, the papers selected for giving’ fashionable; engaging supporters in problem-solving
this Special Issue respond to the suggestion made by Dacin and improving the affective positioning of problem solvers
et al. (2011, p. 1211) that a focus on outcomes (positive and (i.e. making problem solvers appealing to those factors that
negative) and context constitute the most meaningful way drive charitable behaviour).
of understanding social entrepreneurship, both theoretically In the second article, entitled ‘A Positive Theory of
and empirically. The papers in this volume investigate how Social Entrepreneurship’, Filipe M. Santos develops a
charity and entrepreneurial cultures shape social entrepre- theory that advances scholarly research in social entrepre-
neurship; how positive outcomes depend on whether a neurship by explaining its distinctive role in the economic
value creation or a value capture approach is adopted; how system, and pointing to the specifics of the social entre-
different social entrepreneuring models lead to different preneurship approach as opposed to traditional forms of
outcomes and why researchers need to broaden their per- entrepreneurship. The author argues for a definition that
spective beyond the individual level to include collective goes beyond entrepreneurship with a ‘social mission’ or a
forms of social entrepreneurship. In addition, this issue ‘social purpose’ (as has often been the case in mainstream
features two in-depth case studies on social entrepreneurs social entrepreneurship approaches), and beyond compar-
and their enterprises, and examines how these ‘individual isons of economic versus social value (and thus prompting
creations’ became collaborative efforts. the need to classify what is social and what is not). He
In the first article ‘A Tale of Two Cultures: Charity, adopts a descriptive view and stresses the need to decide if
Problem-Solving and the Future of Social Entrepreneur- a company’s focus and intended goal is predominately
ship’, J. Gregory Dees explains two different (sometimes value creation (i.e. creating a strong and important impact
complementary, sometimes conflicting) value systems, or for society in general) or value capture (i.e. appropriating a
clusters of cultures, that constitute the domain of social substantial portion of the value created with the aim of
entrepreneurship. Both of these systems, he explains, are making a profit). According to Santos neither profit-ori-
rooted in our psychological responses to the needs of others ented companies nor governments (due to a lack of
and are reinforced by social norms. One of these systems is resources) will systematically engage in areas and activities
the age-old culture of charity in which a selfless action is perceived as having a high potential for value creation but
performed for the benefit of another person out of compas- little potential for value capture (such as eradicating dis-
sion and the charitable actor is rewarded with personal eases or malnutrition in developing countries). These sit-
happiness. The second system encompasses the more con- uations of simultaneous market and government failure
temporary culture of entrepreneurial problem-solving, remain the domain of social entrepreneurs. The author
where skills are judged by the usefulness of results and the defines social entrepreneurship as the pursuit of sustainable
excellence of the methods employed in contributing to solutions to neglected problems with positive externalities.
meaningful lives. Social entrepreneurship, in his view, can He discusses when it is likely that problems with exter-
be regarded as a recent extension of the analytic problem- nalities will be neglected (i.e. when the externalities are
solving cluster. He stresses five areas of differences and localised—meaning they benefit just a segment of the
tension between charity and entrepreneurial problem-solv- population, e.g. racial minorities or elderly people). He also
ing: (1) spontaneous charity versus reasoning about social describes the central goal and approach of social entre-
return; (2) honouring sacrifice and justifying weak results preneurs, which is (1) to seek sustainable solutions rather
versus the need for talent and expertise to address challenges; than sustainable advantages and (2) to develop solutions
(3) pure giving versus employing business-like approaches; built on the logic of empowerment rather than the logic of
(4) relieving suffering versus solving the problem and its control. The author uses economic and institutional argu-
cause and (5) caring for people versus empowering people. ments to advance theories on social entrepreneurship.
J. Gregory Dees argues that the most social entrepreneurs The third contribution to this Special Issue, ‘Organizing
rely to some degree, at least in the early phase of activities, on for Society: A Typology of Social Entrepreneurship
resources that are given out of a charitable impulse. But he Models’ by Johanna Mair, Julie Battilana and Julian
goes further in arguing that the success of social entrepre- Cardenas, does not rely on preconceived definitions and
neurship depends on aligning these two cultures (and their conceptualisations of social entrepreneurship, but derives a
inherent values) so that the personal satisfaction of giving typology of social entrepreneuring models from descrip-
can help further the contribution of smart problem-solving tions provided by social entrepreneurs themselves. A glo-
for the good of society. In the final part of the article, bal sample of 200 social entrepreneurial organisations that
J. Gregory Dees presents a strategy for a new, blended cul- intend achieving social change with the support of two
ture in which he emphasises the importance of: learning organisations (Schwab Foundation and Ashoka) was

123
Introduction to Special Issue 319

content- and cluster-analysed by the authors and the com- research and conclude their contribution by highlighting
monalities were identified to derive a social entrepreneur- the important role that collective social entrepreneurship
ing model. The components analysed were (1) the issue plays across sectors in creating markets, new institutions,
domain in which a social entrepreneuring company wants dismantling outdated institutional arrangements and
to make a difference; (2) the target constituencies involved addressing social problems in a more scalable way than
in the process; (3) the activities in which a company individual social entrepreneurs.
engages and (4) the justification of the proposed solution or This Special Issue also features two in-depth case
action (e.g. the principles or ‘orders of worth’ in terms of studies of ‘heroic’ social entrepreneurs and their multi-
inspiration or markets). The results lead to four social en- award winning creations. Yet, both case studies move
trepreneuring models that mobilise different types of cap- beyond the laudable and inspiring actions of visionary
ital: (a) political capital; (b) human capital; (c) economic social entrepreneurs by demonstrating and analysing how
capital and (d) social capital. The findings also reveal an the organisations they built grew, how they were scaled up
underlying logic of justification that may explain different in size, and ultimately, how they became sustainable.
ways of organising across organisations. This study’s In their ‘In Pursuit of Dignity & Social Justice:
contribution embraces the heterogeneity that exists in Changing Lives Through 100 % Inclusion. How Gram
social entrepreneurship as a practice. It also encourages Vikas fosters sustainable rural development’ Nicola M.
further research on different organisational approaches Pless and Jenny Appel investigate an innovative social
adopted by social entrepreneurs and acknowledges the entrepreneurial approach to sustainable rural development
need for research at different levels (e.g. at the organisa- pioneered by Gram Vikas through its ‘Water and Sanitation
tional and field level). Program’. Gram Vikas, founded by former student leader
In ‘Collective Social Entrepreneurship: Collaboratively Joe Madiath, is one of India’s most prominent social
Shaping Social Good’, A. Wren Montgomery, Peter A. enterprises. The authors explore how Gram Vikas develops
Dacin and M. Tina Dacin argue that past research has sanitation programs in India’s poorest regions and its key
overemphasising ‘heroic’ and individual views of social innovation of 100 % inclusion and the process of creating
entrepreneurship and neglected an important area that they democratic, self-governing management systems. Pless and
label ‘collective social entrepreneurship’. By its collabo- Appel demonstrate how Gram Vikas contributes to the
rative nature, collective social entrepreneurship contributes United Nations Millennium Goals of improving health,
to substantive and scalable social change. The authors empowering women, breaking the vicious circle of pov-
define collective social entrepreneurship as collaboration erty, and ultimately, realising the vision of ‘an equitable
amongst similar and diverse actors for the purpose of and sustainable society where people live in peace and
applying business principles to solve social problems. This dignity’. The authors conclude by discussing the manage-
collective action enables acquiring and deploying resources ment challenges that the organisation faces in the area of
from multiple actors through different activities and strat- finance, personnel management and the scaling up its
egies that mobilise supporters, share ideas and knowledge, efforts.
represent diverse viewpoints, build credibility, save costs A country known for its dubious governments and
and drive change. A conceptual framework of collective longstanding struggle with corruption may not be the
social entrepreneurial work is presented using illustrative obvious choice for a socio-economic revolution that is
case studies. The framework shows that collective social expected to play an important role in the elimination of
entrepreneurs work at multiple levels: pooling (sharing global poverty. However, Paraguay, an ‘island without
similar resources) and trading (complementary) resources shores’, as the writer Augusto Roa Bastos once described
within and between sectors (government, for profit and not- it, is home to one of the world’s most innovative social
for profit). The authors acknowledge that much collective enterprises—the Fundación Paraguaya. In their article,
social entrepreneurial work involves pooling and trading ‘Social Entrepreneurs as Responsible Leaders: ‘Fundación
simultaneously. Referring to the discussion of the man- Paraguaya’ and the Case of Martı́n Burt’ Thomas Maak
agement of resource flows, the authors enlist three inter- and Nicolas Stoetter discuss the responsible leadership of
related sets of activities that facilitate and enhance the Martı́n Burt and analyse the organisation’s pioneering
work of collective social entrepreneurs: (1) framing (i.e. approach to solving social problems under difficult socio-
constructing action-oriented sets of beliefs that mobilise economic circumstances, and its increasingly global effort
collective action); (2) convening (i.e. convincing individ- to eradicate poverty. While the achievements and success
uals, groups or networks to collaborate and jointly address of Fundación Paraguaya are the result of a team effort, its
complex issues) and (3) multivocality (i.e. combining remarkable development can be largely attributed to the
multiple voices and multiple lenses to speak to a variety of vision, inspiration and guidance of its founder and chief
audiences). The authors provide suggestions for further executive Martı́n Burt. The organisation’s vision is to be ‘a

123
320 N. M. Pless

leading social enterprise that develops innovative solutions Dacin, M. T., Dacin, P. A., & Tracey, P. (2011). Social entrepreneur-
to poverty and unemployment and actively shares its ship: A critique and future directions. Organization Science,
22(5), 1203–1213.
experience around the world’. The last part underscores the Koe Hwee Nga, J., & Shamuganathan, G. (2010). The influence of
social purpose of the venture, which is not to sell its model personality traits and demographic factors on social entrepre-
to maximise profits, but to promote ideas to maximise neurship start up intentions. Journal of Business Ethics, 95,
social impact. In so doing, social value is created within the 259–282.
Mair, J., & Marti, I. (2006). Entrepreneurship in and around
organisation and its social network. Its business model is institutional voids: A case study from Bangladesh. Journal of
not about gaining a larger share of the pie, but about World Business, 41, 36–44.
making the pie larger—in a sustainable and financially self- Murphy, P., & Coombes, S. (2009). A model of social entrepreneurial
sufficient manner. It is no surprise that Fundación Para- discovery. Journal of Business Ethics, 87, 325–336.
Short, J. C., Moss, T. W., & Lumpkin, G. T. (2009). Research in
guaya is the first and longest-running non-governmental social entrepreneurship: Past contributions and future opportu-
organisation in Paraguay. nities. Strategic Entrepreneurship Journal, 3, 161–194.
Sud, M., VanSandt, C. V., & Baugous, A. M. (2009). Social
entrepreneurship: The role of institutions. Journal of Business
Ethics, 85, 201–216.
VanSandt, C. V., Sud, M., & Marme, C. (2009). Enabling the original
References intent: Catalysts for social entrepreneurship. Journal of Business
Ethics, 90, 419–428.
Bornstein, D. (2004). How to Change the World: Social Entrepre-
neurs and the Power of New Ideas. New York: Oxford
University Press.

123

View publication stats