Social enterprises are putting their social purpose at the heart of their business models, which calls for specific ways to manage and govern those organisations (Borzaga & Solari, 2001; Doherty et al., 2009; Labie, 2005;... [ view full abstract ]
Social enterprises are putting their social purpose at the heart of their business models, which calls for specific ways to manage and govern those organisations (Borzaga & Solari, 2001; Doherty et al., 2009; Labie, 2005; Spear et al., 2004). We observe a great diversity in the way social enterprises combine specific governance features (e.g. ownership rights, democracy, participatory dynamics) and design governance mechanisms, typically the board of directors (Rijpens, 2014). Yet, research on social enterprise governance still shows important gaps in theoretical and empirical knowledge (Cornforth, 2010; Ostrower & Stone, 2006), failing to explain that diversity.
Relying on the assumption that organisations are open systems (Scott, 2008), I focus on the analysis of the interactions of the social enterprises with their environment to explain governance diversity. This approach is relevant for social enterprises insofar as they are viewed as maintaining particular relationships with their environment, being the way they manage the interactions with their stakeholders (Borzaga & Solari, 2001; Campi et al., 2006; Rijpens, 2010) or their greater dependence on their environment for resources and support (Labie, 2005).
Focusing on the interactions between the social enterprises and their environment, I combine three theoretical perspectives into a multi-paradigm approach: new institutionalism theory (Powell & DiMaggio, 1991; Scott, 1995), resource dependence theory (Pfeffer & Salancik, 1978) and institutional work (Battilana et al., 2009; Lawrence et al., 2009). Those perspectives offer alternative explanations about the relationships between the environment and the organisations, particularly regarding the conception of the environment, the nature of the environment-organisation relationships and the motives for organisations to establish environment-organisations relationships (Rijpens, 2014).
The aim of the paper is to confirm the interest and relevance of combining various theoretical frameworks to consider governance issues (Bradshaw et al., 2007; Cornforth, 2003; Hung, 1998) and mostly to show how the combination particularly enriches the understanding of diversity in social enterprise governance. For doing this, I implement a qualitative methodology based on four case studies (Eisenhardt, 1989; Yin, 2009), which is of particular interest to gain a rich understanding of a phenomenon within its context (Saunders et al., 2009). Case studies are Belgian Work Integration Social Enterprises (WISEs); they rely on multiple sources of information collected over one and a half year period through three techniques: semi-directed interviews, direct observation and documentary analysis. Data analysis draws on a qualitative analysis, with all the material having been coded on a semi-open basis following Pettigrew’s contextualist framework (1987) and then reduced to extract the connections and patterns.
The findings emphasize mutual enrichments through the combination of multiple theories to take into account temporality and make the theories communicate. They highlight transversal elements that explain diversity in social enterprise governance, pointing out how the environment plays a role and under which conditions. Governance arrangements appear to result from a delicate balance between the structuring action of the environment and the ability of the actors to exploit strategic opportunities. Those arrangements appear to result from a cycle of interactions along which institutional, resource and strategic issues are raised to finally form a spiral of production and reproduction of logics of action in the field.
The main contributions of my research lie in bringing organisational theory into research on social enterprise governance to go beyond the sole description of governance models and secondly in the mutual enrichments of the three theories to better understand the mechanisms at work in designing governance arrangements. It also contributes to help advances in the practical understanding of the social enterprise governance to help social entrepreneurs and managers to design and evaluate their governance arrangements.
