"TOPIC-25-STAGE-3-MICRO"
Business organizations have faced increased public pressure to help address far-reaching societal problems. This pressure has led to the adoption of behaviors meant to fulfill their perceived social responsibility (e.g., CSR programs). In contrast, nonprofit organizations, whose primary activities have traditionally been premised on achieving a social mission, face an increasing expectation to adopt practices that are typically associated with business. In fact, they have experienced a growing shift towards business-like practices, such as the adoption of strategic planning, financial auditing, and performance measurement. In the meantime, at the forefront of addressing social problems while simultaneously sustaining themselves economically are business “hybrids”, like co-operatives and social enterprises. Co-operatives, in particular, can be considered the true specialists in delivering both commercial and societal value. Hence, in maintaining a social mission alongside the imperative of operating within a market economy, nonprofit organizations can learn a lot from co-operatives. Besides, co-operatives and nonprofit organizations have many things in common, as they both rely on structures that differ from those of investor-owned firms, while both involve a moral element, in the form of the social nature of the former and the mission-driven nature of the latter. Attending to both a social mission and a business venture is challenging however. Even as social and business aspects can reinforce one another, they are associated with contradictory expectations that typically raise persistent conflicts and challenges (e.g., mission-drift concerns). Management control systems like measurement tools can be instrumental in orienting the behavior of organizations towards the concurrent fulfillment of business and social goals. For example, measurement tools assist managers and Board members in better-informed decision-making on both fronts, while securing data availability for a responsible disclosure. Even though many studies have examined the performance measurement of co-operatives and nonprofits, research is still inconclusive, particularly on how social performance should be best measured. In our paper, we provide a comprehensive overview of empirical studies on performance measurement (e.g., applied academic papers, industry standards, policy reports). In so doing, we explore how the interdisciplinary conversation between applied performance research on co-operatives and nonprofit organizations can help both improve their measurement instruments and, thereby, better manage business-social tensions. Preliminary findings suggest that, among others, inadequate benchmarking, multiple objectives’ complexity, data availability, and the lack of accurate social impact metrics, are common issues. Our research is ongoing and more findings will be presented at the ICA 2016 conference.
Topic #14 Measuring and Assessing Co-operative Performance and Resilience
