(Illustration by iStock/wenmei Zhou)
Social enterprises—organizations that use business activities to pursue social good—aren’t usually recognized as political actors. But a new research study aims to change that by looking at how and why they get involved in advocacy.
“This research underscores the importance of recognizing the political activities of social enterprises and offers new insights for studying hybrid organizing and organizations that address complex societal challenges,” the researchers write. “By highlighting the integral role of advocacy, our study contributes to a more comprehensive understanding of how social enterprises drive social change, not only through direct service provision but also by shaping the broader sociopolitical environment.”
Academic researchers who study social enterprises typically look at how the organizations serve the community and operate as businesses. The authors of the paper—Johanna Mair, a professor of organization, strategy, and leadership at the Hertie School in Berlin and academic editor of Stanford Social Innovation Review; and Nikolas Rathert, an assistant professor of organization studies at Tilburg University in the Netherlands—took a different approach.
“I’ve been doing research on social enterprise and entrepreneurship for 25 years,” Mair says. “A lingering question is: Why don’t we explicitly look at the political side?” Since the most effective way to solve social problems is to influence those with official power, it makes sense that social enterprises would engage in politicking, so it was important for research to look at this pathway to activism. “Social enterprises don’t operate in a vacuum,” she says.
To find out whether, how, and to what extent social enterprises engage in advocacy, the researchers turned to survey data taken in 2015 from 718 social enterprises across seven European countries—Germany, Hungary, Portugal, Romania, Spain, Sweden, and the United Kingdom. These organizations each had a stated social mission, one or more full-time workers, and business activities generating at least 5 percent of revenues.
Local-language analysts interviewed each enterprise, with extra online questions as well. The entities were spread across the countries and addressed problems in one of six domains: culture, education, health, social services, environment, and human development. The researchers specifically asked the enterprises about whether they engaged in either of two forms of advocacy: policy advocacy directed at government and legislators, and sociocultural advocacy directed at society at large to influence beliefs, attitudes, and norms.
Although data from each country revealed different distributions between sociocultural and policy advocacy, the results showed that most social enterprises interviewed were active in advocacy work: 76 percent said they advocated on sociocultural issues, and 62 percent said they worked on policy, while a mere 8 percent said they didn’t engage in any advocacy.
The study also showed that their activism was correlated with governmental budget pressure. If public spending declined in a particular problem domain covered by a social enterprise, the organization was more likely to engage in advocacy, stepping in to draw more attention to the issue.
The study also showed that organizational form matters: Social enterprises that compete with businesses, as well as those that have for-profit legal status, are less likely to engage in advocacy. If so, “social enterprises step away from this lever of social change,” Mair says.
One particularly interesting finding in the paper is “the idea that social enterprises can help ‘fill in’ for nonprofits that lack capacity to advocate, because the social enterprises can use funds from their commercial activities to advocate, whereas more traditional nonprofits face more restrictive funding,” says Jennifer Mosley, a professor at the University of Chicago’s Crown Family School of Social Work, Policy, and Practice.
Mosley praises the way Mair and Rathert use the idea of “markets for public purpose” to design new variables that predict social enterprises’ involvement in politics, showing how they are different from either regular companies or nonprofits: “This is a very tailored and smart approach that gives us more confidence in their model.”
The study also highlights how social enterprises view their place in between nonprofits and businesses. “Essentially, the more they see themselves as ‘business-like,’ the less they focus on structural social-change work,” Mosley says.
Find the full study: “The Political Side of Social Enterprises: A Phenomenon-Based Study of Sociocultural and Policy Advocacy” by Johanna Mair and Nikolas Rathert, Journal of Management Studies, forthcoming.
Read more stories by Chana R. Schoenberger.