Social entrepreneurship, hybrid organizations and B-Corps

Understanding Community Enterprise through the Humane Entrepreneurship lens

Nicoletta Buratti, Cécile Sillig, Massimo Albanese

The present research inquires Community Enterprise (CE), i.e. firms that work “for sustainable regeneration in their community through a mix of economic, environmental, cultural, and social activities. They are independent, not-for-private-profit organizations, locally accountable, and committed to involving local people in the process of regeneration” (Development Trust Association, 2000).

In their modern form, they have developed since the 1970s in depressed rural and urban areas of both the Global North and South (Pearce, 1993; Peredo and Chrisman, 2006) i.e. in areas with no attractiveness for profit-oriented enterprises, or affected by the long-term indifference or inadequacy of institutions or philanthropic action (Harper, 1991; Gordon, 2002). The peculiarity of the CE is to be a kind of firm that departs from traditional models, in which the agent is not an individual or a group of individuals, but the whole local community (Peredo and Chrisman, 2006 and 2017) and whose primary goal is the attainment of the well-being of its community of reference (Bernardoni, 2018). Given the multiple needs of a community, CEs’ objectives are also multiple, and pertain (to varying degrees) to the economic, social, and environmental spheres. Moreover, the concept of development upon which community entrepreneurship relies is based on the recognition of positive relations and virtuous loops between these three areas.

The mechanism that links this kind of enterprises and communities may be summarized as follows. On the one hand, because their contexts are scarcely endowed with “traditional” competitive resources (Steiner et al. 2019), they go to dig for their development on the community-specific capacities, i.e. social and territorial capital (Putnam, 1973). On the other hand, they develop, in whole or in part, activities that favor local development and that can trigger multiplier mechanisms, supporting existing local businesses or encouraging the creation of new economic activities (Peredo and Chrisman, 2006).

In recent years, CE has been subject to political and regulatory interest in a few countries (Bailey, 2012; Kleinhans, 2017; Mori and Sforzi, 2018). In Italy, underpinned by the long tradition and success of the cooperative movement (Bernardi, 2007) and of social cooperatives, they are indeed spreading in the cooperative form (Community Cooperative, CC). Several regions have already recognized them at the regulatory level and they are involved in projects and promotion policies. Among these, the European Interreg Italy-France Maritime project MeCo, which represents the starting point of the reflections presented in this paper.

As pointed out by some scholars (Johannisson, 1990; Gordon, 2002; Peredo and Chrisman, cit; Sforzi, 2018a) CEs have managed to develop and consolidate over time in contexts characterized for decades by a marked decrease – in addition to the resident population – of economic activities in the territory. In other words, they managed to survive, and sometimes even develop, in environments where other forms of enterprises (namely traditional profit-driven firms) have failed.

CEs and CCs entrepreneurs consider commercial objectives within a holistic conception of development, of which the territory and local community are the driving force. Now, the function of the integration between business and non-business activities and motivations, does not seem to be fully catchable through conventional approaches to entrepreneurship. On the other hand, most of the founders of the CEs interviewed in the context of the MeCo research project, did not define themselves as «social entrepreneurs», but instead narrated their entrepreneurial project, emphasizing both its market-oriented activities and the community-oriented initiatives.

In the light of these considerations, we have set ourselves the following research objective:

RO: given the multiplicity of goals underlying the decision to undertake a community entrepreneurial project,  which kind of entrepreneurial posture is best able to capture the relationships between motivations, strategic pathways and results achieved?

#case study #community enterprise #cooperative firms #humane entrepreneurship