CHAPTER 4: SOCIAL ENTREPRENEURSHIP AND THE GLOBAL ENVIRONMENT

FOR ENTREPRENEURSHIP

True/False:

1. Social responsibility consists of those obligations that society has to businesses.

ANS: F

2. Social obligation, social responsibility, and social responsiveness are all ways firms view their
interactions with society.

ANS: T

3. Social entrepreneurs are known to combine resources to exploit opportunities to create social value.

ANS: T

4. Ecopreneurship is a combination of ecologically and economically sustainable development.

ANS: T

5. The triple bottom line is an accounting framework that focuses on optimizing short-term financial
performance.

ANS: F

6. The three Ps of the triple bottom line are people, planet, and profits.

ANS: T

7. Purpose, accountability, and transparency are characteristics associated with socially sustainable
enterprises.

ANS: T

8. Successful global start-ups, or entrepreneurial businesses that are “born global,” surprisingly often lack
internationally experienced management.

ANS: F

9. International alliances rarely require the exchange of proprietary knowledge.

ANS: F

10. Licensing agreements can involve patents, trademarks, and technical know-how.
 ANS: T

Multiple Choice:

1. One researcher established a framework that classified social actions of corporations into distinct
categories that included
a. social obligation.
b. social responsiveness.
c. social action.
d. a and b only.
ANS: D

2. The most pro-active position for a corporation to take regarding social responsibility would be termed
a. social obligation.
b. social intensity.
c. social responsiveness.
d. social decisiveness.
ANS: C

3. Which of the following designations is not synonymous with social entrepreneur?

a. social innovator
b. public entrepreneur
c. civic entrepreneur
d. social impersonator
ANS: D

4. Which of the following statements about social entrepreneurship is not true?

a. Social entrepreneurship is limited to the world of not-for-profit corporations.
b. Social entrepreneurship is about having a heightened sense of accountability
c. Social entrepreneurship has, in recent years, been the subject of widespread media
attention.
d. Social entrepreneurship adopts some of the same principles that have been effective in
successful entrepreneurship.
ANS: A

5. If we accept the argument that social entrepreneurship is a continuum, at one extreme would be social
entrepreneurs driven exclusively by producing social benefits; at the other, would be
a. social entrepreneurs motivated by the environment with social benefits being the means
b. social entrepreneurs motivated by profitability with social benefits being the means
c. social entrepreneurs motivated by income from their beneficiaries
d. social entrepreneurs motivated by income with entrepreneurial means
ANS: B
6.Examples of social enterprise obligations to the environment include all of the following except
a. pollution control
b. restoration of the environment
c. recycling efforts
d. support for minority-own businesses
ANS: D

7. Corporate social responsibility refers to

a. the enhancement of global competition
b. environmental entrepreneurship in the United States
c. actions that further some social good beyond the interests of the firm
d. the affect of ecopreneurship only on some industries
ANS: C

8. Ecopreneurs are concerned

a. only with ecologically sustainable development
b. only with economically sustainable development
c. both ecologically and economically sustainable development
d. neither ecologically nor economically sustainable development
ANS: B

9. Key elements in plans to create a sustainable future are likely to include which of the following?
a. eliminating the concept conservation
b. eliminating the concept of waste
c. eliminating the concept of “price”
d. eliminating the concept of accountability
ANS: B

10. An account framework that goes beyond the traditional measures of profit, return on investment, and
shareholder value to include environmental and social dimensions is called
a. the shared bottom line
b. the value proposition
c. the triple bottom line
d. the twin bottom line
ANS: C

11. Bottom-line measures of economic performance include all of the following except:
a. global competition
b. personal income
c. cost of underemployment
d. job growth
ANS: A
12.An L3C is a new legal form for social enterprises known as
a. limited liability corporations
b. low-profit, limited liability companies
c. long-term, low-profit, low-liability companies
d. limited liability laborers
ANS: B

13. Among the advantages for global entrepreneurs of diaspora networks is

a. the speed with which information flows across borders
b. the distrust among traditional trading partners
c. the creation of places where anything can happen
d. the decline in political risks across ethnic communities
ANS: A

14. Methods for going international include all of the following except
a. importing
b. exporting
c. licensing
d. foreign reclamation
ANS: D

15. The first of five steps for entering the international marketplace is
a. securing adequate financing
b. filing the proper documents
c. conducting research
d. preparing a feasibility study
ANS: C

Short Answer:

1. List some activities that have come to be associated with social entrepreneurship.

ANS:
Adoption of a mission to create and sustain social value; recognition and relentless pursuit of
opportunities for social value; engagement in continuous innovation and learning; action beyond the
limited resources at hand; heightened sense of accountability.

2. Why has sustainable development, perhaps, become the most prominent topic of our time?

ANS:
 Reports of ozone depletion, climate change, and the destruction of the planet’s biodiversity are
commonplace, and scholars have claimed that entrepreneurial action can preserve ecosystems, counteract
climate change, and deduce environmental degradation and deforestation.

3. In the context of benefit corporations, what does transparency refer to?

ANS:
Transparency refers to the obligation to report to the public on a firm’s overall social and environmental
performance, using a credible third-party standard.

4. Why is global thinking important to today’s entrepreneurs?

ANS:
Global thinking is important to today’s entrepreneurs because today’s consumers can select products,
ideas, and services from many nations and cultures. One of the most exciting and promising avenues for
entrepreneurs to expand their businesses is by participating in the global marketplace.

PTS: 5

5. Explain the concept of informal international alliances. What path do entrepreneurs usually follow with
respect to informal international alliances?

ANS:
In general, informal alliances are agreements between companies from two or more countries that are not
legally binding. Because such agreements lack legal protection, most entrepreneurs limit their
involvement with informal alliances or avoid them altogether.

PTS: 5