We investigate the fundamentals of the Social Joint-Venture (SJV) model to grasp the conditions to which it may address both a transformative and sustainable mission. A SJV is a proper company co-created by a nonprofit and a profit organization; it operates commercial activities that allow for economic sustainability while implementing a social mission either through its processes or through the good or service provided. We analyze the first four Social Joint-Ventures created in France, which all were structured by a Work Integration Social Enterprise (WISE) and a commercial enterprise.
First, the literature of collaboration between profit and non-profit sectors (see, e.g., Austin & Seitanidi, 2012) is of interest. According to Semenowicz (2014), neither the functionalist nor the dialectical approaches are optimistic concerning the sustainability of such collaborations.
We therefore test Austin & Seitanidi’s theoretically-constructed fourth level of collaboration continuum, i.e. the “transformational collaborations” (2012, p.736) which further Austin’s 2000 three-step collaboration model (philanthropic, transactional and integrative), on our empirical field to verify its empirical relevance. Additionally, we further the studies conducted on the Social Business Joint-Ventures operated by Grameen, (e.g., Humberg & Braun, 2014): they do not draw the specificities and tensions of the model and the conditions for it to play an institutionally transformative part.
Additionally, the literature on WISEs’ tensions (especially Battalina et al, 2015; Pache et al, 2015) helps us analyze the tensions within such hybrids. We cross this area of the literature with the previous one to further the research through the lenses both of the French institutional context and of the co-construction model of a JV with a social purpose.
Finally, the conventionalist approaches within the French literature help us take our distances from conceptions of value as intrinsic in order to hinge on processes of valuation (Orléan, 2011).
We elaborate our empirical approach based on data collected within four SJVs. We conduct semi-directive interviews with management and staff of each position, analyses of various boards and meetings, of management decisions and tools, macro-institutional analysis (economic context, legal frames, etc.).
We intend to distinguish three intertwined fundamentals that the SJV model draws. First, the core characteristics: complementary shareholders and pool of complementary skills. Second, its raison d’être: legitimation processes during inception and management. Third, the way stability is built over time depending on a given conception of value. We delineate some conditions for SJVs to be institutionally transformative through ethical and political deliberation process analysis; we document the subsequent empirical translation within day-to-day management processes as well as the tensions encountered consequently.
Accordingly, we address the central issue of fair value creation and distribution within a given institutional context. Instead of conceiving fundamental values that are created and managed, we argue in line with Orléan (2011) that there are only processes of valuation. In parallel, rather than talking about stability, we analyze SJVs as metastable entities: these are always in a dynamic process of stabilization due to their inherent tensions and not just due to their environment that may have a disturbing influence over them. We eventually argue that the valuation processes and the metastable dynamic of the SJV are constructed and evolve together.
We conclude with a tentative formal understanding of SJVs as metastable models that may play an actual socially transformative part facing a given institutional context should the underlying conventions of valuation be in line with such a social mission. We pinpoint specific necessary but not sufficient managerial recommendations to do so which we should verify through further research within other institutional contexts.
Main references
Austin J. E., Seitanidi M. M., 2012, « Collaborative value creation: A review of partnering between nonprofits and businesses », Nonprofit and voluntary sector quarterly, vol. 41, p. 726-760.
Battilana J, Sengul M, Pache AC, Model J, (2015), "Harnessing productive tensions in hybrid organizations: The case of work integration social enterprises", Academy of Management Journal, Vol. 58, p. 1658‑1683
Braun B, Humberg K., (2014), “Social Business and Poverty Alleviation: Lessons from Grameen Danone and Grameen Veolia”, in “Social Business: Theory, Practice, and Critical Perspectives”, Springer: Heidelberg, pp 201-223
Orléan A., (2011), « L’empire de la valeur », Paris, Seuil.
Santos F, Pache AC, (2015), ”Making hybrids work: Aligning business models and organizational design for social enterprises", California Management Review, mai 2015
Semenowicz P, (2014), « Collaborer avec le secteur lucratif », Revue internationale de l’économie sociale : Recma, N°333, juillet 2014, p. 78-90
1. Concepts and models of social enterprise worldwide
