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Journal of Social Entrepreneurship

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Social Entrepreneurship and Sustainability: A


Conceptual Framework

Mohammed Faiz Kamaludin, Jesrina Ann Xavier & Muslim Amin

To cite this article: Mohammed Faiz Kamaludin, Jesrina Ann Xavier & Muslim Amin (2021): Social
Entrepreneurship and Sustainability: A Conceptual Framework, Journal of Social Entrepreneurship,
DOI: 10.1080/19420676.2021.1900339

To link to this article: https://doi.org/10.1080/19420676.2021.1900339

Published online: 16 Apr 2021.

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JOURNAL OF SOCIAL ENTREPRENEURSHIP
https://doi.org/10.1080/19420676.2021.1900339

Social Entrepreneurship and Sustainability: A


Conceptual Framework
Mohammed Faiz Kamaludin , Jesrina Ann Xavier and Muslim Amin
School of Management and Marketing, Faculty of Business and Law, Taylor’s University, Kuala
Lumpur, Malaysia

ABSTRACT KEYWORDS
In the emerging field of academic research on social entrepre- social entrepreneurship;
neurship, studies linking social entrepreneurship to sustainability sustainability; concep-
is gaining interest due to the importance of connecting these tual framework
two constructs. The purpose of this study is to propose an
updated conceptual framework that links social entrepreneurship
to sustainability. A literature review of social entrepreneurship
journals was conducted, resulting in identifying four key dimen-
sions in social entrepreneurship which are social, economic,
behaviour and governance. These four dimensions have been cat-
egorised to have an effect on social entrepreneurship and sustain-
ability. Additionally, the theory of change and logic model are
business processes that have been identified, extending into the
measurement of social impact by using either the social return on
impact or balanced scorecard approach to complete the concep-
tual framework. Hence, this study is envisioned to provide original
work in the theoretical development of linking social entrepre-
neurship to sustainability that will benefit academicians and prac-
titioners alike.

Introduction
The issue of achieving sustainability is more relevant now than ever, as businesses,
including social enterprises, are facing the threat of a worldwide economic downturn
resulting from the global pandemic of the COVID-19 virus. There is an urgent need to
understand the underlying factors that influence social entrepreneurs in attaining sus-
tainability. In order to achieve this, it is pertinent to develop a conceptual framework
that links social entrepreneurship to sustainability by exploring four key dimensions
which are social, economic, behaviour, and governance. Although substantial research
on social entrepreneurship and sustainability have been studied, there is very little
research conducted in exploring these four specific dimensions to connect these two
constructs. This theoretical gap needs to be intricately examined as they have not
been extensively researched in previous studies and other theoretical approaches.

CONTACT Mohammed Faiz Kamaludin mohammedfaizkamaludin@sd.taylors.edu.my School of Management


and Marketing, Taylor’s University, Taylor’s Lakeside Campus, 1, Jalan Taylors, Subang Jaya, Selangor, Kuala Lumpur
47500, Malaysia
ß 2021 Informa UK Limited, trading as Taylor & Francis Group
2 M. F. KAMALUDIN ET AL.

Other areas related to social entrepreneurship, such as the business processes and
measurement of social impact will also be explored to increase the understanding of
its effect on sustainability.
Various conceptual models have been developed to link social entrepreneurship to
sustainability by scholars in the past (Guleid 2014; Javed, Yasir, and Majid 2019;
Ketprapakorn and Kantabutra 2019; Priya and Venkatesh 2019; Zhang and Swanson
2014; Muralidharan and Pathak 2018; Rahdari, Sepasi, and Moradi 2016; Tien et al.
2020; Rey-Marti, Diaz-Foncea, and Alguacil-Mari 2020) to prove that both these con-
cepts are intercorrelated. The development of their process models, conceptual and
theoretical frameworks indicate a significant interest in this research field and empha-
sise the importance of understanding the relationship between sustainability and
social entrepreneurship. Consequently, this study provides the needed avenue to fur-
ther develop on their ideas and proposes an updated conceptual framework to
address issues and limitations highlighted by previous scholars in their concep-
tual models.
Therefore, this effort in conceptualising sustainability for social enterprises bears
merit by addressing weaknesses and gaps in previous papers to provide academicians
with a more comprehensive set of variables and process models in testing out new
theoretical propositions. Due to the growing interest by academicians to delve into
the link between social entrepreneurship and sustainability, the objective of this study
is twofold. Firstly, this study seeks to explore and understand this critical connection.
This vital phenomenon needs to be studied thoroughly to provide academicians and
practitioners with a platform to navigate through this nascent field of social entrepre-
neurship and sustainability. Secondly, the purpose of this study is to propose an
updated conceptual framework that links social entrepreneurship to sustainability.
Achieving both objectives will equip real-world businesses and social enterprises with
the required knowledge and capabilities to enhance their chances in attaining sustain-
ability for their ventures. This study is pivotal in its importance as it can be applied
now during a pandemic situation and in the ensuing years to help social enterprises
weather any perplexing global economic environment in the unforeseeable future.

Methodology
Defining social entrepreneurship can be a daunting task with the abundance of aca-
demic literature accessible in this unique and fast-emerging field. However, an analyt-
ical approach can be conducted methodologically. For this study, an initial search for
the definition of social entrepreneurship was carried out from online databases limited
to Google Scholar, Business Source Complete, JStor, and Taylor & Francis Online. These
databases comprise of relevant articles and journals in the field of business, manage-
ment, and social ventures.
To acquire the most relevant results, the method undertaken entails the review of
journals published in the latest year and then moving backwards. The second stage of
the process is to trace references and citations from journals considered pertinent to
the proposed study. This study intends to first investigate the current literature on the
definition of social entrepreneurship and to identify significant themes, followed by
JOURNAL OF SOCIAL ENTREPRENEURSHIP 3

Figure 1. Methodology.

developing an updated conceptual framework to add value to the field of social entre-
preneurship. The Journal of Social Entrepreneurship was identified as having the most
significant and relevant journals in extracting current literature and trend in research
within the scope of social entrepreneurship.
The first phase of search conducted in January 2019, resulted in 11 journals from
Google Scholar, 20 journals from Business Source Complete and JStor, and 20 journals
from the Journal of Social Entrepreneurship. Articles from the Journal of Social
Entrepreneurship were further divided into three categories. They are the latest articles,
most cited, and past volumes. Using the latest NVivo software for Mac, twelve themes
were discovered which are market orientation, theory development, human resource
development, economic, attitudes, operational effectiveness, motivation, leadership,
social network, performance measurement, sustainability and innovation. For ease of
reference, the phase one search is depicted in the following diagram (see Figure 1) with
the discovered themes as a result of the literature review and data analysis.
From these twelve discovered themes, research on the sustainability aspect of social
entrepreneurship proved to be an essential subject matter that required further inves-
tigation. For the second phase, a search was conducted using the term ‘sustainability’
with ‘social entrepreneur’ and ‘social entrepreneurship’. This search was conducted
using Google Scholar, Business Source Complete, JStor, Scopus, and Taylor & Francis
Online. In addition, other related publications within the field of social entrepreneur-
ship such as the Social Enterprise Journal by Emerald Sight and the International
Journal of Social Entrepreneurship and Innovation, from Inderscience Publishers were
included in the phase two search. As the literature review progressed, 121 relevant
journals were identified, reviewed and indexed for research. The 121 journals were for-
matted into a literature review matrix for ease of reference.
4 M. F. KAMALUDIN ET AL.

From this literature review matrix of articles, further analysis using the NVivo soft-
ware was conducted on social entrepreneur and social entrepreneurship, which
resulted in identifying four fundamental dimensions that will influence social entrepre-
neurial sustainability. These four dimensions identified were then categorised as social,
economic, behavioural, and governance. A conceptual framework was then developed
using the input-process-output model to link social entrepreneurship to sustainability.
The social business operations and social impact measurements were used as the pro-
cess and output models.

Social Entrepreneurship
Social entrepreneurship is gaining momentum in the fast-changing business land-
scape, where technology and innovation dominate the industry. According to
Seanor and Meaton (2007), a social enterprise has a strong social mission at the
heart of its business existence with the secondary objective of making a profit to
sustain its operations. In a study by Irawan, Suryanto, and Mashud (2019), they dis-
covered that most social entrepreneurs started out without having any prior expert-
ise or knowledge in the field of social entrepreneurship. By understanding their
social missions, social entrepreneurs can grow and learn from their social networks
to affect change that they desire. For social entrepreneurs, the primary purpose of
establishing a social enterprise is to create sustainable change in the lives of peo-
ple. According to Ebrashi (2013), this change should be at a community level
rather than on an individual level, concentrating more on social impact rather than
the desired outcomes. Additionally, Graikioti, Sdrali, and Kaminari (2020) state that
community development is essential in social entrepreneurship to address social
needs that have not been satisfied by the market. In order to create the desired
positive change in a community, social entrepreneurs must have a strong focus in
achieving their social goals while enduring any financial constraints to become
more sustainable.
However, social enterprises cannot drive social change by themselves. They require
governmental support and are dependent on policies to aid their development (Kadir
and Sarif 2016). Conversely, the emergence of social entrepreneurship is to address
unmet social needs resulting from governmental failures (Dufays and Huybrechts
2014). Similarly, Hill, Kothari, and Shea (2010) argued that weak, unresponsive, and
inefficient governmental institutions paved the way for social entrepreneurs to fill in
the social gap by being more market-orientated and nimble in employing more effi-
cient business models as compared to governmental institutions. A social entrepreneur
will employ a business acumen model to achieve that societal change. Their report
states that for non-profit organisations to transform into social enterprises, they must
change their structure to be more business-like.

Defining Social Entrepreneurship


The evolution of social entrepreneurship has encouraged many researchers and acade-
micians alike to study this broad and nascent field. One such study compiled and
JOURNAL OF SOCIAL ENTREPRENEURSHIP 5

reviewed over 307 documents and literature on social entrepreneurship, and created a
cluster map that produced 140 different definitions of a social enterprise (Alegre,
Kislenko, and Berbegal-Mirabent 2017). What is inherent in their effort is that there is
not any single unified definition that is agreed upon that defines what is social entre-
preneurship today. The lack of a standard definition and construct measurement, hin-
ders research and raises questions about which social or profit-making activities fall
within the spectrum of social entrepreneurship (Moss, Lumpkin, and Short 2008). In a
study by Abu-Saifan (2012, 25), the following definition was proposed. ‘The social
entrepreneur is a mission-driven individual who uses a set of entrepreneurial behav-
iours to deliver social value to the less privileged, all through an entrepreneurially ori-
ented entity that is financially independent, self-sufficient, or sustainable’. Lumpkin
et al. (2013, 762) defined social entrepreneurship as a ‘social value creation process in
which resources are combined in new ways to meet social needs, stimulate social
change, or create new organisations’. Their research indicates that the business proc-
esses of a commercial enterprise and a social enterprise are very similar and suggested
that having a social mission is the distinguishing feature of a social enterprise.
Social entrepreneurship can be defined by three characteristics, which are social
innovation, accountability, and sustainability. It is exercised when social entrepreneurs
create social value by taking advantage of opportunities through innovative solutions
and scarce resources (Peredo and McLean 2006). According to Mair and Marti (2006),
there are three known concepts and definitions in social entrepreneurship research
that should be differentiated. They are social entrepreneur, social entrepreneurship,
and social enterprise. The term social entrepreneur is referred to the founder of the
initiative, whereby social entrepreneurship is the process, and social enterprise is the
tangible outcome of the process or social vehicle of the initiative.

Definition of a Social Entrepreneur


A social entrepreneur is a central figure in social entrepreneurship. A social entrepre-
neur is deemed as the initiator of social endeavours that creates social innovations
and solutions to bring about the specific social change to the desired community
(Khare and Joshi 2018). Compared to a commercial entrepreneur, a social entrepreneur
will give higher priorities to social value creation and achieving a social mission (Mair
and Marti 2006). Consequently, Cohen, Kaspi-Baruch, and Katz (2019) agree that the
difference between a social entrepreneur and a commercial entrepreneur is in the pri-
orities given to creating social value instead of economic gains. It was further stated
that social entrepreneurs are not interested in short-term charity activities but are
more commonly engaged in long-term social projects that are embedded in their
visionary social missions. The pursuance of a social mission and ultimately changing
the social environment is what motivates a social entrepreneur to start a social ven-
ture (Yangui and Jarboui 2013). In this study, based on the identified dimensions of
social, economic, behavioural and governance, a social entrepreneur is defined as an
individual that is driven by a specific social mission that creates value for the desired
underserved community and network while utilising an entity that is financially inde-
pendent and sustainable. A social entrepreneur is highly innovative in bringing change
6 M. F. KAMALUDIN ET AL.

which is needed by employing sound entrepreneurial business acumen that is moti-


vated by a strong sense of being autonomous through good governance.

Definition of Social Entrepreneurship


Social entrepreneurship is a process in which social entrepreneurs can combine resour-
ces such as human, financial, and material in an innovative way to serve and satisfy an
unmet social gap that cannot be maintained by the standard welfare system (Jain
2009). Certo and Miller (2008) reiterated by expressing it as a process that involves the
recognition, evaluation, and exploitation of opportunities that result in social value.
This social value encompasses the provision of basic human needs such as food,
water, shelter, medical services, and education for the targeted communities and soci-
ety in need. To affect social value, Haldar (2019) indicated the need to look beyond
fixing immediate social problems but to understand other numerous interdependen-
cies that reside within the larger social system. By understanding the bigger picture,
social impact can be realised. Wolk (2008) states that social entrepreneurship com-
bines business principles with a passion for social impact. Social impact is the value
created by social enterprises in achieving its social mission that will help alleviate soci-
etal problems and produce environmental benefits (Santos, Pache, and Birkholz 2015).
In this study, social entrepreneurship is defined as the practice which is different from
other forms of entrepreneurship by incorporating social activities and processes under-
taken to enhance the social well-being of communities by creating new ventures that
are self-sustaining, revenue-generating, and innovatively progressive in managing
their operations.

Definition of a Social Enterprise


According to Lepoutre et al. (2013), a social enterprise will embody the following three
characteristics. They are the predominance of a social mission, the importance of
innovation, and the role of earned income. More importantly, social enterprises are
able to create employment during an economic crisis by virtue of helping others.
Innovations are developed to address current issues to help generate economic pro-
gress (Erro-Garces 2020). It is evident that during the current COVID-19 pandemic
period, social enterprises can quickly pivot their operations and provide innovative sol-
utions in improving pressing social issues. By providing opportunities for people to
become more self-sufficient, most social problems such as health, poverty, and educa-
tion can be alleviated (Arend 2020). However, Grieco (2018) argued that most defini-
tions of social enterprises are missing the concept of social impact measurement. A
social enterprise should be an organisation with the primary aim of achieving a meas-
urable and positive social impact that uses profits for the achievement of that impact.
In this study, social enterprise is defined as an organisation or entity that provides
services in line with their social objectives aimed to alleviate a specific social issue
while operating in a manner that is self-sustainable and business-like. Social enter-
prises are dynamic and innovative in delivering measurable social impact that will alter
the ecosystem in which the social problem resides.
JOURNAL OF SOCIAL ENTREPRENEURSHIP 7

Sustainability
Academic journals on sustainability have surfaced from as early as the 1990s (Sarango-
Lalangui, Santos, and Hormiga 2018). The study on the subject of sustainability in social
entrepreneurship has garnered the interest of academicians worldwide by being the
pivotal challenge that is required in bringing about positive growth and development
of social enterprises. However, there are many misperceptions when addressing the
concept of sustainability and the term sustainable development. Diesendorf (2000)
addressed this issue and highlighted that both concepts are contestable and different.
Sustainable development as defined in the renown Brundtland Report as ‘development
that meets the needs of the present without compromising the ability of future genera-
tions to meet their own needs’ (World Commission on Environment and Development
1987, 41). Diesendorf (2000) defined it by stating that sustainable development com-
prises of various types of economic and social developmental initiatives that protect
and enhances the natural environment and social equity. With the abundance of litera-
ture on sustainable development, it will be moderated in this study as the concept of
sustainable development covers the four quadrants of the sustainability lens which are
resources, health, policy, and exchange. These broader topics on sustainable develop-
ment are areas set out by the United Nations to achieve their 2030 sustainable develop-
ment goals to eradicate poverty and protect the planet (Stenn 2017).
In the context of social entrepreneurship, sustainability has two facets. Firstly, it con-
cerns the need for social enterprises to survive and endure financially over time.
Secondly, sustainability can only be achieved after social enterprises have established
viability in running their businesses. In other words, social enterprises will not exhibit
sustainability until it has demonstrated the ability to achieve both impact and oper-
ational outcomes over a period of time (Burkett 2010). Previous research papers on social
entrepreneurial sustainability were centred on the integration of three components
which are social sustainability, environmental sustainability, and economic sustainability
(Seelos and Mair 2005; Harris 2003; Javed, Yasir, and Majid 2019). This concept was first
introduced and developed by Elkington (1998) and called the triple bottom line. Based
on Elkington’s triple bottom line framework, sustainability efforts are focussed on areas
concerning people, profit, and the planet. This visionary framework is also known as the
3Ps in business. This concept is being used extensively in the field of sustainability.
According to Weerawardena, McDonald, and Mort (2010), sustainability for social
purpose organisations primarily means being able to survive to serve their constituen-
cies. It is a process of fulfilling their commitments to their clients, patrons, and the
community in which they operate. A key to long-term sustainability in social entrepre-
neurship is to ensure proper management and control of our natural resources. This
goal can be achieved through community-driven initiatives and improvement of oper-
ational efficiencies (Rajput and Chopra 2014). Social entrepreneurial sustainability is
essential in the longitudinal path of creating social change in an ecosystem, as it
requires business endurance and the ability to persevere in the ever-changing and
unpredictable business climate (Alegre, Kislenko, and Berbegal-Mirabent 2017; Moss,
Lumpkin, and Short 2008). According to a report on the sustainability of social enter-
prises in Mexico, 38% of social enterprises are not able to sustain their business within
the first year of its operations. Subsequently, only 9% of social enterprises are
8 M. F. KAMALUDIN ET AL.

sustainable after five years, and a mere 5% of social enterprises are sustainable
beyond ten years of operations (Lopez-de-Alba et al. 2017). In support of this issue
concerning sustainability, it has been reported that as many as 40% of all new social
initiatives and programs are not sustainable beyond the first few years after its con-
ception and initial funding (Gimmon and Spiro 2013). Based on the above reports,
achieving sustainability in social entrepreneurship is a pertinent construct to explore
and pursue.
This alarmingly high rate of failures and a low percentage of sustainability of social
enterprises require deeper understanding by academicians in developing theoretical
approaches to generate sustainable social ventures (Dacin, Dacin, and Matear 2010).
With the current global threat of business failures inflicted by the COVID-19 pandemic,
there is a need to explore this vital connection between social entrepreneurship and
sustainability to help navigate through this unprecedented period.

Linking Social Entrepreneurship to Sustainability


Research on linking social entrepreneurship to sustainability by Zhang and Swanson
(2014), suggests that social entrepreneurship is intrinsically sustainable as the primary
objective of social enterprises is to achieve sustainability by fulfilling both social goals
and economic gains. A study by Salvado (2011) stressed on the importance of revenue-
generating activities by social enterprises to achieve social impact that is significant in
scale by diversifying their operations. These activities, in turn, will help promote finan-
cial sustainability for their organisations. Additionally, the sustainability of social enter-
prises can be achieved by maximising positive impact through the management of
healthy and mature ventures by incorporating social equity, economic prosperity, and
environmental integrity as part of their business philosophy (Meyer and Gauthier 2013).
According to Martin and Osberg (2015), social enterprises must learn to be financially
sustainable by avoiding the practice of receiving funds from charitable organisations or
through subsidies from governmental institutions. These identified methods of indefin-
ite revenue flow will not enable sustainability for social enterprises. To achieve sustain-
ability, the operational expenditure in running social enterprises will reduce as their
number of beneficiaries grow. Their report states that social entrepreneurship is the
most sustainable and impactful way to bring about change.
Graikioti, Sdrali, and Kaminari (2020) defined social entrepreneurial sustainability as
the state of achieving a social purpose while staying financially viable. To further
expand on this definition, in this study social entrepreneurial sustainability is defined
as the process of developing sustainable solutions for social, economic, or environ-
mental problems that are not being addressed with the ability to endure over time by
continually improving on operational efficiencies (Burkett 2010; Santos and
Roberts 2013).
According to Tiwari, Bhat, and Tikoria (2020), there are many competing concepts
and definitions of social entrepreneurship without a unifying conceptual framework.
This situation has resulted in difficulties by researchers to carry out progressive
research to further develop the progression of social entrepreneurship in countries
and regions where the growth rate is slow. Consequently, Jaakkola (2020) states that
proposing new relationships between constructs will enable logical arguments about
JOURNAL OF SOCIAL ENTREPRENEURSHIP 9

their associations rather than empirically testing them. By applying the input-process-
output model, a conceptual framework can be developed to link social entrepreneur-
ship to sustainability. The input-process-output model is chosen as the model is best
suited in providing a well-organised way to study and record aspects of a transform-
ation process. (Rogelberg 2017). A conceptual framework on linking social entrepre-
neurship and sustainability has been designed by utilising four critical dimensions in
defining social entrepreneurship, social business processes, and methods of social
impact measurements (Figure 2).

Figure 2. A conceptual framework linking social entrepreneurship to sustainability.


10 M. F. KAMALUDIN ET AL.

This conceptual framework provides an essential platform for academicians and


researchers alike to study the connection between social entrepreneurship and sus-
tainability. The input column contains the social entrepreneurial dimensions, which are
social, economic, behaviour, and governance. The social business operations are
depicted by applying the theory of change, being outcome orientated or by using the
logic model, which is process orientated. These business processes will produce the
output, which is social impact. Social impact can be measured by using the social
return on investment or the balanced scorecard method. By understanding the mone-
tised social value or non-financial impact of a social enterprise, sustainability is the
resulting outcome of the input-process-output model. The conceptual framework cre-
ated will be the needed impetus in promoting further research in this nascent field
that will be beneficial to academicians, researchers, and practitioners worldwide.

Social Entrepreneurial Dimensions and Variables


From the preceding narratives, there is a need to explore further on what the term
social entrepreneurship represents so that it will be beneficial in establishing a theor-
etical link to sustainability. From the data analysis of articles gathered using the meth-
odology mentioned above, four key dimensions have been identified to define social
entrepreneurship. They are social, economic, behaviour, and governance. Each variable
within the defined dimensions will be used to formulate a conception of what a social
entrepreneur embodies. There are five social variables, five economic variables, seven
behavioural variables, and two governance variables. In total, nineteen variables will
be depicted in the following tables.

Social Factors in Social Entrepreneurship


According to Kuznecova (2016), the social dimension within the domain of social
entrepreneurship is characterised by its social purpose and sense of altruism. However,
Mair and Marti (2006) argued that social entrepreneurship is not an expression of
altruism exclusively. The motives for participating in social entrepreneurship may
include other than altruistic reasons such as personal fulfilment and desire for achieve-
ment. In this study, factors such as a social mission, value creation, networks, commu-
nity, and change are grouped to represent the social dimension (Abu-Saifan 2012;
Alegre, Kislenko, and Berbegal-Mirabent 2017; Chell 2007; Dacin, Dacin, and Tracey
2011; Dees 2001; Defourny and Nyssens 2010; Hill, Kothari, and Shea 2010; Kadir and
Sarif 2016; Moss, Lumpkin, and Short 2008) (Table 1).

Economic Factors in Social Entrepreneurship


The second dimension identified in defining a social entrepreneur is the economic fac-
tor. According to Costa and Pesci (2016), despite having to maintain a social mission,
social entrepreneurs will need to implement strategies to attain economic efficiency.
The economic dimension is critical to ensure social entrepreneurial sustainability.
Exploring the economic dimension is vital to differentiate between social entrepre-
neurship from other forms of social movements such as non-profit organisations, char-
itable bodies, and philanthropic initiatives (Grieco 2018). For this study, the economic
JOURNAL OF SOCIAL ENTREPRENEURSHIP 11

Table 1. Social factors in social entrepreneurship.


Key Dimensions:
No. Social Factors Authors Findings
1. Social Mission Abu-Saifan (2012); Alegre, Kislenko, Social cause and mission
and Berbegal-Mirabent (2017); to benefit the
Dacin, Dacin, and Tracey (2011); community and
Dees (2001); Defourny and create value.
Nyssens (2010); Hill, Kothari, and
Shea (2010); Kadir and Sarif
(2016); Moss, Lumpkin, and
Short (2008)
2. Value Creation Alegre, Kislenko, and Berbegal- Community development
Mirabent (2017); Chell (2007); Hill, and create change.
Kothari, and Shea (2010); Moss,
Lumpkin, and Short (2008)
3. Networks Abu-Saifan (2012); Dacin, Dacin, and Like-minded community
Tracey (2011); Defourny and and group of
Nyssens (2010) responsible citizens.
4. Community Alegre, Kislenko, and Berbegal- Conduct in the manner
Mirabent (2017); Hill, Kothari, and that benefits
Shea (2010) the community.
5. Change Alegre, Kislenko, and Berbegal- Promotes change in
Mirabent (2017) the ecosystem.

dimension consists of accountability, generating wealth, innovation, providing new


opportunities, and being financially independent (Abu-Saifan 2012; Alegre, Kislenko,
and Berbegal-Mirabent 2017; Chell 2007; Dees 2001; Defourny and Nyssens 2010; Kadir
and Sarif 2016; Moss, Lumpkin, and Short 2008) (Table 2).

Behavioural Factors in Social Entrepreneurship


Behaviour is a critical dimension in defining a social entrepreneur as it covers a wide
range of variables such as culture, identity and image, cognition, behaving entrepre-
neurially, business-like behaviour, acting boldly, and individual attributes. According to
Mair and Marti (2006), many academicians have focussed their studies on the behav-
ioural traits of social entrepreneurs to examine their entrepreneurial nature and to dif-
ferentiate it from other known phenomena. This behavioural dimension is broad and
should be researched extensively (Abu-Saifan 2012; Chell 2007; Dacin, Dacin, and
Tracey 2011; Dees 2001; Defourny and Nyssens 2010; Hill, Kothari, and Shea 2010;
Kadir and Sarif 2016; Moss, Lumpkin, and Short 2008) (Table 3).

Governance Factors in Social Entrepreneurship


The governance dimension is often overlooked and excluded in the process of defin-
ing social entrepreneurship because it consists of only two identified variables, which
is governance and autonomy. The governance dimension is essential as it covers social
impact activities and interactions between clients and beneficiaries to achieve social
entrepreneurial sustainability (Santos, Pache, and Birkholz 2015). Subsequently, work
by Defourny and Nyssens (2010) and Hill, Kothari, and Shea (2010) have highlighted
the importance of governance and autonomy in their research on defining social
entrepreneurship (Table 4).
In summary, by identifying the social entrepreneurial dimensions and variables, a
conceptual framework can be constructed. Academicians will be able to apply these
12 M. F. KAMALUDIN ET AL.

Table 2. Economic factors in social entrepreneurship.


Key Dimensions:
No. Economic Factors Authors Findings
1. Accountability Dees (2001); Defourny and Accountability to
Nyssens (2010); Kadir stakeholders
and Sarif (2016) and workers.
2. Generates Wealth Chell (2007); Defourny and Reinvest in business and
Nyssens (2010) limited profit
distribution.
3. Innovation Alegre, Kislenko, and The need to be creative
Berbegal-Mirabent and innovative in
(2017); Dees (2001); delivering products
Kadir and Sarif (2016) and services.
4. New Opportunities Dees (2001); Kadir and Opportunity recognition.
Sarif (2016); Moss,
Lumpkin, and
Short (2008)
5. Financially Independent Abu-Saifan (2012); Mitigation of economic
Defourny and Nyssens risks and firm
(2010); Moss, Lumpkin, performance.
and Short (2008)

Table 3. Behavioural factors in social entrepreneurship.


Key Dimensions:
No. Behavioural Factors Authors Findings
1. Culture Abu-Saifan (2012); Dacin, Adaptation to local culture
Dacin, and and customs. Innovative
Tracey (2011) work culture.
2. Identity and Image Dacin, Dacin, and To establish and reinforce
Tracey (2011) the identity of social
entrepreneurs.
3. Cognition Dacin, Dacin, and Entrepreneurial cognition
Tracey (2011) of social entrepreneurs.
4. Behave Entrepreneurially Abu-Saifan (2012); Chell Operate in a manner of an
(2007); Hill, Kothari, and entrepreneur.
Shea (2010)
5. Business-like Behaviour Chell (2007); Defourny and Conduct commercial
Nyssens (2010) activities to
generate income.
6. Acting Boldly Dees (2001); Defourny and Decision-making skills and
Nyssens (2010); Kadir entrepreneurial focus.
and Sarif (2016); Moss,
Lumpkin, and
Short (2008)
7. Individual Attributes Moss, Lumpkin, and Leadership characteristics
Short (2008) and motivation.

constructs when researching areas concerning social entrepreneurial behaviour such


as leadership, attitudes, and motivation. This study will explore two other essential
constructs to further the theoretical development of linking social entrepreneurship to
sustainability. They are social business operations and social impact measurement.

Social Business Operations


A social business is operated based on using either the theory of change method or
the logic model method. In the field of social entrepreneurship, the theory of change
JOURNAL OF SOCIAL ENTREPRENEURSHIP 13

Table 4. Governance factors in social entrepreneurship.


No. Key Dimensions: Governance Factors Authors Findings
1. Governance Hill, Kothari, and Shea (2010) Proper governance of organisations.
2. Autonomy Defourny and Nyssens (2010) Self-governing operations.

method is categorised as outcome orientated, whereas the logic model method is cat-
egorised as process orientated. The theory of change differs from the logic model, as
it reflects a program theory. It underlines the basis of why outcomes can be expected
and the identification of the causal relations in achieving the desired outcomes. The
logic model method is more process orientated depicting program components and
detailing the processes so that activities will result in the social impact intended (Bacq
2017; Clark and Anderson 2004).

Theory of Change
The concept of theory of change first emerged in the 1990s in line with the rapid
development of the impact evaluation field for sustainable development. The theory
of change can best be defined as a process or method that can be applied for pro-
gramming planning (Weiss 1995). It is not the actual development of a theory in the
scientific meaning. The theory of change uses theories or empirical findings to define
how a program will work by providing evidence to support assumptions or presump-
tions in the intervention phase or program functions. The theory of change focuses on
the desired preconditions that need to be achieved by relying on empirical evidence
and identifying the interventions that are needed to be executed (Weiss 1997).
Information about a target group is gathered systematically by compiling findings,
studies, and observations to develop the interventions required to achieve the
social mission.
According to Mook, Chan, and Kershaw (2015) to understand the theory of change,
it uses a backward mapping process from the desired long-term goals and then identi-
fying the preconditions and interventions that are required to achieve that goal. The
theory of change lacks a standard structure, but in general, it graphically shows the
change process for an organisation concerning their planned activities. The visuals cre-
ated by the theory of change will depict various changes that are conceived to occur
in response to these activities, and the eventual outcomes the social mission is
designed to accomplish. It will illustrate the big picture of the processes required,
including issues that cannot be controlled. It will also show all the different other
paths that might lead to change even though some of the items depicted are not
related to the services offered by the said organisation (De Silva et al. 2014).
Jackson (2013) states that the theory of change is a cost-effective way to frame an
evaluation. It is a flexible tool that promotes analytical accuracy and attention. It can
be achieved by using a wide array of data collection and analysis methods.
Subsequently, areas of responsibilities may be identified, assigned, and delegated to
improve program development (Sullivan and Stewart 2006) Even though their initial
reports indicate that theory of change framework is gaining importance in the pro-
gram design stage, there are still setbacks encountered in employing the theory of
change framework. They cited that the evaluation process remains widely regarded as
an afterthought activity.
14 M. F. KAMALUDIN ET AL.

To further support this fact, research findings by Carman (2010) indicates that there
are design and implementation flaws by organisations when utilising the theory of
change framework. The implementation irregularities are caused by a large number of
evaluation tools employed, and additional reporting requirements imposed from rele-
vant stakeholders and funders to attain a measurable mission outcome. These unstan-
dardised methods of evaluation are the leading cause of disruption in the
implementation of the theory of change framework for social enterprises.

Logic Model
The Logic Model is defined as ‘a systematic and visual way to present and share your
understanding of the relationships among the resources you have to operate your
program, the activities you plan, and the changes or results you hope to achieve’ (W.
K. Kellogg Foundation 2004, 1). It is a graphical representation of how a program func-
tions theoretically under specific conditions to achieve the desired targets (Rauscher,
Schober, and Millner 2012). With the increasing need for social enterprises to operate
in a more result-orientated manner, the logic model has gained importance in promot-
ing accountability on the part of social organisations. The logic model will illustrate
essential program components in undertaking the task of completing a desired social
mission by listing the inputs, activities, outputs, outcomes, and impact (W. K. Kellogg
Foundation 2004).
According to Wilson (2009), the logic model can be considered as the starting point
of a more elaborate data collection system. The logic model is more widely used com-
pared to the theory of change method as investors and funders would generally
require a program logic model. They will often base program evaluation on adherence
to the logic model. The logic model is deemed as the minimum standard model for
defining the social impact (Smith 2010). The disadvantage of the logic model is that it
has been criticised for being too linear in form (Preskill 2009), but the framework
allows for more precise identification of the planned interventions that will affect the
outcomes and impact on the desired target group. To further develop the link
between social entrepreneurship and sustainability, it is essential to understand the
relationship concerning the measurement of social impact.

Social Impact Measurement


The measurement of social impact generated by social enterprises and social ventures
alike is gaining importance in the field of business and entrepreneurship. Stakeholders
in the non-profit sector have transformed and orientated their operations towards a
profit-orientated way of management. This evolution has created the need for impact
analysis and impact measurement that is new in concept, required by venture philan-
thropies and foundations that are funding these newly established social enterprises.
Maas and Grieco (2017) further state that the impact measurement process can help
organisations gauge their efforts in enabling a more equitable and sustainable society.
In a study by Chmelik, Musteen, and Ahsan (2016) on the measurement of perform-
ance in the context of international social ventures, they listed nine methods to meas-
ure social impact. They are social return on investment (SROI), balanced scorecard,
JOURNAL OF SOCIAL ENTREPRENEURSHIP 15

SIMPLE methodology, social audit, benefit-cost ratio, BACO ratio, cost-benefit analysis
(CBA), cost-effective analysis (CEA), and cost per impact (CHIP). With the vast array of
methods in measuring social impact that is being practised, comparison of perform-
ance can be complicated and ultimately resulting in unclear definition on what makes
a social initiative successful compared to other ventures (Short, Moss, and Lumpkin
2009). In their research, they discovered that most social ventures that were studied
did not provide details about the metrics of their performance and measurement of
social impact. This limitation can create difficulty for future research in the context of
social impact measurement.
To narrow down the most common and effective method of measuring impact,
results from the interviews employed by Chmelik, Musteen, and Ahsan (2016) on social
entrepreneurs revealed that the usage of the balanced scorecard method garnered 28
statements, which was the highest; followed by the social return on investment
method with 24 mentions. For this study on social entrepreneurship and sustainability,
only the social return on investment and the balanced scorecard methodologies will
be used for social impact assessment.

Social Return on Investment (SROI)


SROI is fast becoming the most commonly used performance measurement technique
employed to measure social impact performance focussed on quantifying the social
value. The SROI model was first introduced by the Roberts Enterprise Development
Fund (REDF) in 2000 and was further developed four years later by the New
Economics Foundation (NEF) to better determine the measurement of social impact by
modifying the conventional cost-benefit analysis method (Rotheroe and Richards
2007). The conventional cost-benefit analysis is a systematic process of calculating the
costs and benefits of a project. It is then used as a decision-making tool by organisa-
tions to decide on the feasibility of a project (Cellini and Kee 2010). The SROI model
assigns monetary values to this cost-benefit analysis process. It is specifically con-
ducted to provide social impact information to the decision-makers of social enter-
prises and their funders (Walk et al. 2015). The SROI equation can best be represented
by a formula which states a ratio of the return on investment resulting from an organ-
isation’s enterprises combined with the value of its activities in furthering its social
purpose (Moody, Littlepage, and Paydar 2015).
In a study by Mook, Chan, and Kershaw (2015) to measure the value created by
social enterprises in achieving sustainability, they suggested the need to develop an
integrated approach in calculating the SROI by incorporating both methods of social
accounting and conventional accounting. They recommended that due to the lag in
timing for social impact to occur, a longitudinal approach of measurement may be
costly and challenging but will produce a more accurate picture of an organisation’s
social impact progress and sustainability.
The accuracy in the measurement of SROI received criticism from the majority of
social enterprises in a study by Millar and Hall (2013) stating that there exist different
assumptions surrounding SROI practices and the actual values of social enterprises.
Companies cited practical difficulties in calculating SROI values which directly affects
their social impact effectiveness to commissioners and other external audiences.
16 M. F. KAMALUDIN ET AL.

Despite the encouragement and requirement by the regulatory bodies to measure


their social impact using the SROI method, their research found that the SROI method
proved relatively unsuccessful due to these methodological and practical challenges.
Due to the difficulty in assigning an accurate financial figure to measure social impact
outcomes by social enterprises, a paper by Bertotti et al. (2011) justifies the rationale
behind why a majority of social enterprises are not using SROI and other measure-
ment tools to calculate their social impact.
Conversely, the main benefit to social enterprises in implementing the SROI
valuation process is the ability to understand their own organisation’s social mission
better. The learning process undertaken in calculating SROI values will transform
social-driven entities to fine-tune their operations in achieving their desired social
impact (Moody, Littlepage, and Paydar 2015). In conclusion, the strength of the SROI
method is the ability to permit investors and stakeholders to conduct a comparative
analysis of different social enterprises. This process will result in attaining a competi-
tive advantage when it comes to funding and performance comparisons for the inves-
ting organisations (Ryan and Lyne 2008).

Balanced Scorecard
The balanced scorecard is an impact measurement method that focusses on internal
efficiency and the operational effectiveness of a social enterprise. It is a
‘multidimensional management tool that includes several perspectives including finan-
cial, customer, internal processes, learning and growth, and vision and strategy’
(Chmelik, Musteen, and Ahsan 2016, 77). According to Kaplan and Norton (1996), the
balanced scorecard method is a well-developed business analysis tool designed for
social enterprises and organisations that are socially orientated. In another context,
the balanced scorecard method was created based on a concept that other vital com-
ponents such as intellectual capital, exceptional customer orientation, and knowledge
creation are collectively more important than the efficient usage of investment capital
(Figge et al. 2002). Utilising the balanced scorecard methodology will help socially ori-
entated organisations conclusively demonstrate and present their values to relevant
stakeholders.
According to Somers (2005), the balanced scorecard method provides a map entail-
ing mission objectives, strategies, and outcomes. It will depict specific measurements
to each outcome, the personnel responsible for each outcome, and the measurement
associated with it. This methodology will ensure that strategies are executed effect-
ively and that the measurement of success is periodically evaluated. However, the bal-
anced scorecard framework has an apparent weakness as it must be integrated with
measurement techniques that are more robust because it is generally measured quali-
tatively (Kaplan 2001). Due to this evident disadvantage, social enterprises that have
adopted the balanced scorecard method to measure their performance are very few
in numbers. Research by Meadows and Pike (2010) indicate that the tracking of per-
formance utilising the balanced scorecard method by social enterprises is weak and
inadequate. They proposed the creation of an outcome tracking tool based on a longi-
tudinal approach where possible, which will enable better evidence of social impact
measurement.
JOURNAL OF SOCIAL ENTREPRENEURSHIP 17

To summarise it, if social enterprises continue to provide innovative solutions to


alleviate social issues, the importance of understanding and calculating social impact
will increase. The industry would still require more consistent ways of measuring the
performance of organisations delivering these impacts.

Discussion and Implications for Theory and Practice


This study explored the dimensions in social entrepreneurship, social business proc-
esses, and social impact measurement to develop a conceptual framework utilising
the input-process-output model to link social entrepreneurship to sustainability. By
applying the proposed conceptual framework, a theoretical connection to social entre-
preneurial sustainability can be established.
It is important to highlight that past literature linking social entrepreneurship and
sustainability are centred on sustainability in the form of sustainable development,
which looks into the four quadrants of the sustainability lens which are resources,
health, policy, and exchange (Stenn 2017). Muralidharan and Pathak (2018) introduced
a theoretical framework to study social entrepreneurship and sustainable development
goals. Rahdari, Sepasi, and Moradi (2016) employed the Business Model Canvas to link
sustainable development and social entrepreneurship; and Tien et al. (2020) developed
a theoretical framework on social entrepreneurship and sustainable development.
However, in this study, sustainability refers to social sustainability, economic sustain-
ability, and environmental sustainability in social entrepreneurship. For example,
research by Rey-Marti, Diaz-Foncea, and Alguacil-Mari (2020) looked specifically at the
social sustainability aspect of the social enterprises being studied. Researchers who
wish to study sustainability in social entrepreneurship should consider examining all of
the three components of social, economic, and environmental sustainability as a
demarcation from sustainability in the form of sustainable development.
Several research papers will be discussed in this segment that explored the connec-
tion between social entrepreneurship and sustainability. Priya and Venkatesh (2019)
developed a conceptual framework that examines the personal and social drive in
social entrepreneurship to determine factors that affect sustainability. Their findings
indicate that employing sustainable business practices is the key to the betterment of
human life. It was recommended that by being proactive in taking advantage of new
opportunities and investing in innovation will ensure social entrepreneurial sustainabil-
ity. Guleid (2014) developed a conceptual framework to measure sustainability, and
the findings indicate that job satisfaction, organisational culture, and organisational
commitment can directly create positive effects on the performance level of social
enterprises. These variables were used to determine the sustainability of social ven-
tures. The weakness of both frameworks (Priya and Venkatesh 2019; Guleid 2014) is
that they did not explore and consider the various methods of business processes and
impact measurement techniques. Addressing this oversight offers future researchers
greater breadth in trying to determine social entrepreneurial sustainability.
Javed, Yasir, and Majid (2019) developed a theoretical framework and identified
social mission, innovation, networking, and financial returns as factors affecting sus-
tainability. The social entrepreneurial dimensions offered in their framework were
18 M. F. KAMALUDIN ET AL.

somewhat limited to justify their efforts in conducting quantitative research to provide


empirical evidence to prove the connection to sustainability. Their findings highlighted
the importance of understanding how social enterprises are managed to attain the
empirical data that supports their theoretical framework of social entrepreneurial sus-
tainability. They tested their hypothesis and leaned towards resource-based theory to
discover that social innovation to be the most significant factor in influencing sustain-
ability. The limited number of social entrepreneurial dimensions was mentioned in
their report to indicate the apparent weakness in their theoretical framework. This
study has addressed this issue in providing a more comprehensive set of dimensions
and variables to research on.
Ketprapakorn and Kantabutra (2019) developed a sustainable social enterprise
model and identified relationships between corporate sustainability practices and sus-
tainability performance outputs. They identified several reliable, measurable items in
their research that include dimensions of leadership, resilience development, stake-
holder focus, and sharing. These items have been generalised by their research as
measurable dimensions to enhance the sustainability of social enterprises. In their
model, sustainability is represented by output variables such as brand equity, socio-
economic performance, and environmental performance. It can be argued that their
model does not elaborate on the processes in which the identified measured dimen-
sions affect the sustainability performance output. The proposed conceptual frame-
work in this study looks to refine on their sustainable social enterprise model by
identifying the social business processes that they have highlighted missing from
their model.
Zhang and Swanson (2014) developed a conceptual process model to pioneer in
linking social entrepreneurship and sustainability. The process model developed is
comprehensive as it entails the recommended social business processes that include
social entrepreneurial orientation, resource bricolage, and mission adaptation required
to achieve sustainability. However, they acknowledged that their list was not devel-
oped to provide an exhaustive set of comprehensive propositions, but rather to invoke
further discussions to help practitioners improve on their operational efficiencies.
Consequently, the theoretical implications of the conceptual framework developed in
this study will add depth to the available frameworks and models, mainly targeted for
academicians to test on their theoretical constructs to connect social entrepreneurship
to sustainability.
The practical implications of this study suggest that if social enterprises ignore the
importance of sustainability, they will pay the price of a short-lived business tenure.
By adhering to the conceptual framework in developing sound business processes
such as the implementation of a theory of change or logic model, may provide the
needed structure within the organisation to achieve short term sustainability.
Subsequently, by measuring social impact using the SROI or the balance scorecard
method, social enterprises may attain long term sustainability. Social enterprises that
make an effort in understanding the conceptual framework may benefit in achieving
sustainability by understanding their own business model and implementing the
needed changes on how they can operate more efficiently to maintain a sustainable
business venture.
JOURNAL OF SOCIAL ENTREPRENEURSHIP 19

Limitations and Recommendations for Future Research


Due to the conceptual nature of this study, the limitation of the proposed conceptual
framework is that the social impact measurement methods were simplified by only
including the SROI and balanced scorecard methods. Nine other reliable methods can
be used but have been excluded to highlight the hierarchical importance of these two
above-mentioned social impact measurement methods (Chmelik, Musteen, and Ahsan
2016). Future researchers may expand on this area and possibly introduce newer and
customised methods of social impact measurements. These methods may have been
developed and utilised by organisations specifically tailor-made to calculate their
unique output of social impact performance and its influence on sustainability.
Additionally, the conceptual framework presented in this study does not elaborate on
any measurement metrics to indicate social entrepreneurial sustainability as repre-
sented in varying sustainability output metrics by Ketprapakorn and Kantabutra (2019).
Further research can be carried out to include these identified output metrics and
look into other variables that may be used to measure sustainability. However, sustain-
ability in this proposed conceptual framework is denoted as an end product of the
input-process-output model. Thence, it only provides the required variables to study,
followed by processes and outputs required to achieve sustainability for social
enterprises.
By proposing an updated conceptual framework, further research on social entre-
preneurial traits such as leadership, attitudes, and motivation can be further investi-
gated. The conceptual framework may also be applied to differentiate the social
entrepreneurship sector from other business segments in research. In addition, popular
research fields in social entrepreneurship such as studies on theory development,
social network, resource-based view, organisational orientation, opportunity recogni-
tion, and social innovation may utilise this conceptual framework in identifying social
entrepreneurial dimensions and variables that affects sustainability.

Conclusion
It is imperative to conclude that research and literature which connects social entre-
preneurship to sustainability is gaining interest in academia. Despite the exponential
growth of published articles in the field of social entrepreneurship, there should be
more focus on linking social entrepreneurship to sustainability. This study addresses
the importance of this issue and proposes an updated conceptual framework linking
social entrepreneurship to sustainability. With the current effects of the COVID-19 pan-
demic on the global economy, conceptualising sustainability for social enterprises will
provide the needed avenue for researchers to test theoretical propositions in under-
standing sustainability. This conceptual framework will also help practitioners with the
option of applying changes within their operational structure to attain sustainability in
the social entrepreneurship sector.

Disclosure statement
No potential conflict of interest was reported by the author(s).
20 M. F. KAMALUDIN ET AL.

ORCID
Mohammed Faiz Kamaludin http://orcid.org/0000-0001-9981-8248
Jesrina Ann Xavier http://orcid.org/0000-0001-6376-6538
Muslim Amin http://orcid.org/0000-0003-0818-5663

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