Pro-Social Behaviour Leading to Social Entre

32 CORPORATE AND SOCIAL ENTREPRENEURSHIP –A TRANSFORMATIONAL DIMENSION

Pro-Social Behaviour Leadingto Social Entrepreneurship

Traditional theories of entrepreneurship have been aboutrisk-oriented profit-seeking individuals who identify marketopportunities and exploit them to earn profits. Though usefulto understand a large part of entrepreneurial activities inmodern economies, the focus on profit as the underlyingmotive of entrepreneurs is not helpful in understanding theactivities of social entrepreneurs. Social entrepreneurshiprefers to the creation of viable socio-economic structures,relations, institutions, organizations and practices that yieldand sustain social benefits (Fowler, 2000). Extantentrepreneurship research offers little guidance tounderstand the motivations, mechanisms and outcomes thatare central to social entrepreneurship. In this paper, theauthors attempt to advance understanding in this area bydeveloping a framework that is grounded in the theory ofpro-social behaviour and validated by field observations ofsocial entrepreneurs in Western India. This framework of

Gaurav R Wankhade

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33Pro-Social Behaviour Leading to Social Entrepreneurship

Introduction

There are various Traditional theories of Entrepreneurship defining it by focusingmainly on two traits i.e., Risk taking ability of an individual and the underlyingprofit motive through which an Entrepreneur operates in any available marketidentifying options (Chances or Opportunities) and using those options to theoptimum level to generate his/her desired outcome (Profit). But it specifically doesnot take into consideration another vast set of Social Entrepreneurs, who createsnew organisation by changing socio-economic structure into more viable andsustainable institutional entities. Though sometimes looks similar, the key differencebetween the social entrepreneurs and traditional entrepreneurs is that the formerare not driven by profit motive but are primarily driven by an intrinsic desire tosolve social problems and create social value leading to a social change. The mostsignificant impact of social entrepreneurs on the society is sustainable social benefitsto less privileged sections of society and enormous “economic, psychological, andsocial consequences for the society as a whole”

The activities of social entrepreneurs influence the lives across the globe bydiminishing ‘xenophobic’ boundaries of continents, since social entrepreneur’sworks for the society as a whole. When the vision of one social entrepreneur fromone stratum of the society is shared by another then there get formed a networkof social change which flows through the levels of privileged and underprivilegedpopulous inhabitating, irrespective of the economic situation (Developed,Developing and Underdeveloped). The best examples are Muhammad Yunus(Founder of Grameen Bank) in Bangladesh and Peter Cove (founder ofAmericaWorks) from US working for the same cause with similar dream oferadicating poverty and destitution from the map of the world.

social entrepreneurship developed from grounded theorymethods such as semi-structured interviews and documentanalysis with social entrepreneurs from nine pioneeringsocial organizations incorporates both behavioural as wellas situational factors.


But a paucity of studies exists in the area of social entrepreneurship because ofthe presence and popularity of another type called ‘socially responsible’ entrepreneur;‘entrepreneurs that have had successful business careers and wish to donate a non-trivial part of their personal wealth to social development’. There are significantdifferences in between Social and Socially Responsible Entrepreneurs. A SociallyResponsible Entrepreneurs get involved into various charitable acts of donating apie of his wealth and motivating others to do the same, roaming around the worlddistributing donations to other charitable trusts or Non-profit organisation. Thesetypes of Socially Responsible entrepreneurs easily comes under the limelight, whileentrepreneurial individuals like Wendy Copp and Muhammad Yunus who createnew social organizations ex-nihilo get sidelined.

To better understand social entrepreneurship and bring the discussion of socialentrepreneurs into mainstream entrepreneurship journals is the main objectivewith which this research paper has been developed. And the focus of this study isnot ‘socially responsible’ entrepreneurs but social entrepreneurs. The paperattempts to develop a framework for social entrepreneurship that parallels theopportunity identification and opportunity exploitation conceptualization ofentrepreneurship in the domain of pro-social behaviour theory which helps indistinguishing social entrepreneurship from for-profit entrepreneurship. This hasbeen done by using data collected through interviews with nine socialentrepreneurs. And thus the paper develops preposition based on both theoreticalarguments and qualitative case studies.

Pro-social Underpinnings of Social Entrepreneurship

There are two central premises of entrepreneurship according to most of thescholars: [I] Kirzner’s arbitrage – holds that entrepreneurs seek new ways toconstruct profit from previous errors in inefficient markets and [II] Schumpeter’s‘process of creative destruction’, holds that entrepreneurs are heroic figures luredby profits to introduce new innovations. These two central premises ofentrepreneurial research are based on the underlying assumption thatentrepreneurs are primarily driven by economic incentives, the desire to earnprofits to create economic value for them. The huge body of research based on


these two premises may have contributed to our understanding of entrepreneurialactivity in society; but in reality it has ignored the other species called socialentrepreneurs whose primary mission is not the quest for profits but an innovativesocial change through development of less privileged and underdeveloped sectionsof society. Or in other words one can say that for them the profit is that socialtransformation by which societies could dramatically evolve themselves. The otherliterature concerning to the volunteering in big organisations have a biased focuson larger managements and their functioning. It talks about how some individualsfrom such organisations acts beyond their professional limits to encourageentrepreneurial behaviour amongst employees.

Looking beyond the profit-pursuit and organizational entrepreneurshipmodel there is a need to explore the link in between pro-social behaviour andsocial entrepreneurship to understand two important factors of socialentrepreneurship i.e. social entrepreneurial intentions & behaviour (Perceptionand Response) which some scholars like Mair and Noboa have defined with asimple model. In this model the authors have incorporated cognitive &emotional factors enablers like self efficiency and social support, leading tosocial entrepreneurial intentions, and have shown that ‘How socialentrepreneurship originates from pro-social behaviour?’

One of the earliest approaches examining pro-social behaviours were thefunctional approaches whose central assumption was that human behaviours aremotivated by certain goals, and needs. However, in recent years, scholars havefound support for the idea that altruistic or philanthropical motivation is closelyrelated to volunteering behaviours. According to this approach, volunteeringbehaviour in individuals is generally triggered by some kind of arousal. Manyindividuals are stimulated by observing the distress of others; and the immediatereactionary response to this stimulus is to alleviate the cause of this stimulus.On face it though it look simple there are other minute factors involved andhence there is a necessity to investigate those meso-level factors responsible forpro-social intentions as well as the micro characteristics such as personality traitsand macro social factors that affect the formation of a social enterprise.


Methods

A Grounded Theory Model with multiple cases for development of a more vivid,illustrative, descriptive and complex picture has been used to answer the set ofsub-questions of the main query i.e. ‘what motivates social entrepreneurs to startsocial ventures?’ The set of sub-questions include

1. According to social entrepreneurs, what factors motivate them to start asocial organization?

2. How do social entrepreneurs perceive that there exist a social need andhow do social entrepreneurs try to alleviate this need?

3. What are some of the initial challenges that social entrepreneurs face whensetting up social ventures and according to these entrepreneurs what factors(both personal and macro-social) help them overcome the initial challenges?

For the development of theoretical framework of this Research Study theauthors have considered here two facets i.e. replicability and generalizabilityproviding grounded arguments to form an Inductive theory with appropriateobservations. This study for Social Entrepreneurs who are involved in some typeof creative Social change, takes people from states of Gujarat and Rajasthan forthe purpose of sampling containing a uniform environment (convenience sampling)for understanding of multiple types of Social Entrepreneurs since most of themcome face to face of somewhat similar situations (Risks, Obstacles etc.)

11 Non-Voluntary Organizations (formally organized, named collectives inwhich the majority of participants did not derive their livelihood from theiractivities in the group) excluding those associated with political parties, religiousinstitutions or any existing industrial trading service (registered under PartnershipAct and Companies Act) or their adjuncts, as well as complying to the all otherpredefined criterions, have been specifically selected for the purpose of this study.In the beginning 2 (out of these 11) organization have been chosen to developstructured interviews for the remaining ones’.

Table 1 shows the chosen non-profit organizations for this study which arestarted by social entrepreneurs and the clients they serve.


Thus the main objective of the study is identifying how and why all thesenine Social Organisations were formed with focus on various other issues like theorigin, creativity and communication, decision making process, the challengesfaced and the social and institutional support received by Entrepreneurs whileventuring a social innovation.

The Origins of Social Entrepreneurship Behaviours

By taking some clues like ‘entrepreneurial intentions reveal the motivations behindthe pursuit of entrepreneurial activities’, ‘the primary motivation for theestablishment of social organizations is the alleviation of some perceived socialneed in case of social entrepreneurship’, ‘background of the social entrepreneur iscritical in triggering the perception of social need’ etc. from the previous studies,this paper proposes possessing an empathy-altruistic orientation helps in perceivinga social need for the other social entrepreneurs who start new social organizations(for alleviating an unmet social need) on the similar lines.

Table 1: Social Entrepreneurship Organizations

Name of the Primary Area of Work Secondary Activities Year ofNon-Profit EstablishmentOrganization

Ascent Women’s Awareness Sale of handicrafts 1980made by women

Base Blind and Education Sale of arts and crafts 1950Individuals made by handicapped

individuals

Credit Consumer Education and Journal, newsletters 1978protection

Promise Deaf, dumb, polio and Training handicapped 1970handicapped individuals persons

Secure Rural development N.A. 1990

Earnest Sanitation awareness Self-run oil mills, cloth 1963and training (Khadi) manufacturing

Jade Rural Development N.A. 1986

Grove Child Labour, education, N.A. 1990health

Solace Prison relief, health and Printing press, school, cloth 1949rural issues (Khadi) manufacturing


The empathic altruistic motivations seem to focus on others rather than selfwhen there is distress caused by the perception of someone in need. In case ofAscent, the entrepreneur being a woman could empathize with other womenwho were exploited and wanted to help them in some way which was differentfrom the traditional approaches which were not yielding any result. Before startingthis organization, the founder worked as a volunteer with another importantorganization AWES in this region and also did her doctoral work in a relatedsubject. In this case, her altruistic personality as well as her experiencesvolunteering for AWES generated in her the need for an organization mainlyfocused on helping exploited women in another style than her parent organisation.This characteristic of altruistic personality is also evident from the interview withthe founder of Credit who asks, “How do we repay the debt to society?”

Table 2: Initiation of Social EntrepreneurshipName of the Non-ProfitOrganisation

Ascent

Base

Credit

Promise

Secure

Earnest

Jade

Grove

Solace

Initiation into SocialEntrepreneurship

As a medium to protest against the exploitation of low-incomewomen

Being blind, the founder has started his organization in the areaof blind education & training

Earlier a senior manager in a retail industry, the founder hasstarted voluntary organisation.

As the founder studied Gandhi and influenced by him, started hisorganization as a continuation of his family’s hierarchy of social work.

Since previously involved in volunteering activities, the founderhas started many such similar organization.

After prolonged stints as sanitation worker, the founder hasfurther inspired to take his idea on abolishing scavenging.

Earlier working in a similar organization, the cofounders left it tostart their own new organization.

Having desire to help those neglected by service organisation,the founder after research selected Brick Labourers

As a response to the demand of target group (Patients and theirrelatives for reading material)

Empathy-altruistic orientation is commonly seen in all the organizations whichwere under study and it is very consistent with previous conceptualizations ofsocial entrepreneurship.


Proposition 1: An empathy-altruistic personality is positively associated withperception of a social need and an urge to alleviate this need. There is somesupport in theory that arousal and affect produce two reactions; one, which isempathically induced, produces other oriented cognitions and concern while thesecond one produces feelings of self-focused personal sadness. As one of the casefrom the above example; after witnessing class violence in rural areas, twoentrepreneurs decided to start Jade to promote rural development.

Proposition 2: Feelings of empathy driven by some arousal and subsequent affectare positively associated with perception of a social need and an urge to alleviate thisneed. Here the authors proposes that a perceived social need provides the motive forinitial volunteering but then role-identity drives the urge to alleviate this social need.

Proposition 3: A perception of social need drives volunteering behaviours andover the time period role-identity drives individuals to continue identifying socialneeds and trying to alleviate them. The common patterns that were identified afterinterviewing these entrepreneurs were variables such as arousal and effects thatwere found in almost every case. An altruistic personality helped in the perceptionof a social need. Another important commonality among the social entrepreneursinterviewed was that almost all of them had prior volunteering experience and theyviewed working for social development as part of their personality. Therefore theauthors’ has posited that perception of a social need is the first step in identificationof opportunity where the entrepreneur can contribute.

Micro-Level Influence

This section investigates the micro-level individual variables that may be able toexplain how entrepreneurial intentions are generated. Although most of the micro-level influences are unique personality characteristics, they manifest their presencewhen entrepreneurs are faced with an unexpected problem or need to ensure aninnovative use of available resources. Perceiving a social need is similar to identifyinginformation asymmetries in the social context or identifying limitations of thenormal welfare system in satisfying known social problems. Many individualsespecially those working in the social sector might perceive an unmet social needand some of them respond innovatively. Thus, social entrepreneurial opportunityidentification in the social context would depend on the creative imagination of


entrepreneurs and how they use this creative imagination to innovatively combineexisting resources to combat challenges thus arousing in the way. This creativeimagination serves to surmount the challenges posed by financial shortage,resistance to change or any other shortage of resource or services.

Proposition 4: Creative imagination of entrepreneurs helps them recombineexisting resources to create value and this helps the entrepreneurs identifyopportunities for creating such social value. Grant showed how proactive behavioursare strong predictors of entrepreneurial intentions. Proactive behaviours are alsopivotal to the formulations of social entrepreneurs as individuals who take charge oftheir situations to create value. Credit held a number of public meetings as well aspublished their own magazine to promote awareness about consumer rights.

Proposition 5: Proactive behaviour of entrepreneurs helps them realize andidentify opportunities for creating social value. The argument stated by the authorsis that motivation plays an even greater role as compared to for-profit motivationdue to the nature of the outcomes obtained at the end of the process. Entrepreneursdiffer in their motivation to identify and exploit opportunities with severalmotivational traits such as need for achievement, risk taking, tolerance forambiguity, and locus of control, self-efficacy and goal setting that might beimportant components of entrepreneurial motivation.

Proposition 6: Entrepreneurial motivation helps them realize and identifyopportunities for creating social value.

Macro-Level Influences on Social Venture Creation

The environment in which the entrepreneurs find themselves also plays a veryimportant role in creation of a social venture.

Proposition 7: Social support moderates the relationship between opportunityidentification and venture creation by helping the entrepreneur avail greaterhuman, capital and material resources.

Proposition 8: Institutional pressure moderates the relationship betweenopportunity identification and venture creation by helping the entrepreneur movetowards greater organization and professionalism.


A Framework of Social Entrepreneurship

Combined insights gleaned from both theory and qualitative data have beenused to put forward a framework for studying social entrepreneurship. A meso-level stimulus that helps individuals perceives a social need has also been proposed.This mitigation may take two forms, one where individuals engage in somevolunteer activity and the other where they perceive a necessity of a social enterprisein satisfying a particular social need. Sustained performance of citizenshipbehaviours such as volunteerism and pro-social actions develops a volunteer roleidentity that becomes the pivotal motivator for even further volunteering activitiesakin to a positive self-reinforcing cycle. The motivation and desire to alleviate asocial need are not the only requirements for creation of the social enterprise.Individual entrepreneurial traits do not really capture the complete process ofsocial entrepreneurship as the environment in which these entrepreneurs operateplays a very important role in determining the success of an entrepreneurialventure. The following diagram (Table 3) shows the framework in details.

Table 3: A Model of Social Entrepreneurship


The authors also posit that social entrepreneurship is a multi-level processthat includes meso-level triggers (such as arousal-affect and role identity)embedded within traits (such as proactive personality, motivation and imagination)which are again embedded within environmental factors such as social supportand institutional forces that together influence creation of a social enterprise.

Conclusion

By developing a conceptual framework for social entrepreneurship, which has itsroots in theoretical base of Pro-social Behaviours and ethnographic informationfrom field survey, the paper has tested the validity of prior arguments that somepersons feels it their personal responsibility to satisfy a social desire but found itinsufficient without the use of their innovative and creative actions to bring thatdream of theirs into reality. The other major finding of this study is thatinnovativeness guided by proactive behaviours, motivation and the willingness ofentrepreneurs to start small ventures determines the level of success of the socialenterprise. Other factors which may look extremely important like social trustand support did not find unanimous agreeing in the initial stages of enterprisecreation. The result also showed that engaging in behaviours such as getting aprofessional management or reputed sponsors led to more social support in theform of grants and funds. And with the help of all these entities a SocialEntrepreneur can in fact derive that social change, which we just keep discussing,arguing or writing throughout our life.

(Gaurav R Wankhade, Research Associate, Icfai Research and Publication Centre,Icfai Business School, Mumbai.)

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Pro-Social Behaviour Leading to Social Entre