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The Shared Value Concept in Social Business Model: Promoting Social Enterprise in Malaysia
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... Besides, this study also contributes to the methodological and literature aspects by adopting a quantitative research method to examine the relationships between financial management practices and accountability in Malaysian ISEs. It is a challenge for the researcher because only several studies have been conducted on Malaysian SEs and ISEs (Chan et al., 2021;Farouk and Wing, 2019;Hassan et al., 2018;Kamaruddin and Auzair, 2018;Mohd Ali et al., 2019;Muhamed et al., 2019). In addition, these studies used the qualitative research method to explore Malaysian SEs and ISEs. ...
Purpose
This study aims to examine the role of financial management practices, which consist of financial disclosure, internal control, financial planning and budgeting and financial performance on Islamic social enterprises’ (ISEs) accountability.
Design/methodology/approach
Questionnaires were administered to financial officers of 102 Malaysian ISEs. Findings were analysed using Smart-PLS to examine the relationships between financial management practices and accountability.
Findings
Results of this study indicate a direct relationship exists between internal control and accountability. Relationships between other financial management practices and accountability are indirect through internal control. Hence, the data demonstrates that internal control has a mediating role on other financial management practices, which are financial disclosure and financial performance management with the accountability of ISEs.
Research limitations/implications
This study has implicated the significant role of financial management practices in ISEs in the pursuance of their accountability especially internal control to achieve public trust.
Practical implications
Appropriate financial management practices, especially internal control, are essential for the ISEs to achieve good accountability.
Originality/value
This study contributes to the field of management and social accounting by providing empirical evidence on ISE practices specifically on financial management practices and accountability. This framework thus presents among the early attempts in studying accountability issues in ISEs.
... They cannot survive in the capital market to continue their business operations day to day. Soon or later the public/authority may discover their illegal activities, (Fakrulhazri, Norhayate, Zainol, Rashid, & Afthanorhan, 2018). Once uncovered, the investor will run, and the company start being sued by a lot of side such as the banks if they are unable to repay their debt to the public because ruin their trust and money invested, and list go on. ...
Entrepreneurship has been the engine propelling much of the growth of the business sector as well as a driving force behind the rapid expansion of the social sector. This article offers a comparative analysis of commercial and social entrepreneurship using a prevailing analytical model from commercial entrepreneurship. The analysis highlights key similarities and differences between these two forms of entrepreneurship and presents a framework on how to approach the social entrepreneurial process more systematically and effectively. We explore the implications of this analysis of social entrepreneurship for both practitioners and researchers.
Purpose
This intentionally polemical paper will re-examine what is meant by social enterprise and try to assert its role within the current economic system. It is well over a decade since John Pearce’s Social Enterprise in Anytown was first published. Since then the term ‘social enterprise’ has been used in multiple ways by politicians, practitioners and academics – very often for their own ideological ends.
Design/methodology/approach
This paper will outline the context and challenges currently facing social enterprise both from outside and from inside the social enterprise movement.
Findings
This paper re-affirms a paradigm for social enterprises through re-imagining how social enterprise should and could contribute to the creation of a fairer and more just society.
Originality/value
Finally, this paper will conclude with a reflection on what Pearce argued and how the social enterprise movement has to position itself as a viable alternative way of creating goods and services based on socially responsible values.
A decade ago the concept of social entrepreneurship was rarely discussed in Malaysia even though the practice of delivering social values to the population has been around for years. Efforts that combined the concept of
entrepreneurship and social development were established years before the emergence of the term. Only in recent years the concept of social entrepreneurship is making a significant breakthrough and attaining more interest not only from social entrepreneurs but also academics and policy makers due to globalized economic system that in turn has resulted in the emergence of social entrepreneurship within a complex framework of political, economic and social changes occurring at the global, national and local levels. Nevertheless, the concept and definitions of social entrepreneurship, social entrepreneur and social enterprise need to be comprehended by those who are involved in the sector to further sustain the development of pertinent initiatives. Therefore, this paper reviews current literature pertaining the concepts and definitions of social entrepreneurship, social entrepreneur and social enterprise and recent development of the sector in Malaysia.
Purpose
Business model innovation is a widely discussed research topic which spans all sector boundaries. There is a growing body of literature in the for-profit sector which covers business model innovation. This study analyses what constitutes business model innovation for social enterprises and identifies different types and explains their rationales. The various components which make up a social business model will also be discussed.
Design/methodology/approach
The study is based on a dataset of awards for social innovations in the years 2011 and 2012. In total, 28 competitions, 30 funding institutions, 11 academic institutions and 3 governmental organisations were identified, and between them they awarded 1020 social organisations. 204 of these social organisations had an innovation based on a business model innovation.
Findings
Six types of social business model innovation could be identified, which were opportunity creation, smart distribution, ecosystem engineering, cheap sourcing, smart pricing and inclusive production.
Contribution
This study's main contribution to the body of literature is the identification of different types of social business model innovations and the empirical review of these patterns on a global basis.
Hybrid organizations pursuing a social mission while relying on a commercial business model have paved the way for a new approach to achieving societal impact. Although they bear strong promise, social enterprises are also fragile organizations that must walk a fine line between achieving a social mission and living up to the requirements of the market. This article moves beyond generic recommendations about managing hybrids in order to highlight a typology of social business hybrids and discuss how each of the four proposed types of hybrid organizations can be managed in order to avoid the danger of mission drift and better achieve financial sustainability.
Purpose
Social enterprises are those organisations that seek to attain a particular social objective through the sale of products or services. Social enterprises, therefore, have two main goals: the social and the economic, which coexist in a single organisation. The literature on social entrepreneurship is divided between those authors that defend that this coexistence creates a tension between the two objectives and that there is a trade-off between the social and the economic goal; and those authors that affirm that precisely the most distinctive characteristic of social enterprises is that they manage to merge harmoniously these two objectives. The purpose of the present research is to shed some light on this discussion by evaluating in which cases the tension between the social and the economic goal is exacerbated and in which cases it is mitigated.
Design/methodology/approach
Comparative case study approach.
Findings
The paper presents a framework that classifies social enterprises according to their social mission. Social enterprises whose final product incorporates the social value, experience much less tension between the social and the economic objectives than social companies whose social impact is embedded in the organisational input or organisational process.
Limitations
The framework proposed classifies social enterprises into three categories that correspond to ideal types but reality is much more complex and many social enterprises will not fall clearly into any one category. Further research is needed to include the wide variety of existing social enterprises.
Implications
Currently, social entrepreneurship researchers take different standpoints regarding the existence of the social-economic tension in social businesses. This research clarifies the cases in which the tension is more present than others and therefore provides interesting implications for future research in the area.
Contribution
The differentiation among different social enterprises in social-input, social-process and social-output organisations is a contribution to theory building in the area of social entrepreneurship and, at the same time, useful for practitioners.