‘Fitting In’ vs. ‘Standing Out’: How Social Enterprises Engage with Stakeholders to Legitimize their Hybrid Position

Abstract

We investigate how social enterprises actively engage with their stakeholders to legitimise their hybrid position in addressing both social and businesses audience. This is particularly important in their effort to capturing stability (expectation to 'fit in') within an emerging field and at the same time to address change and growth (expectation to 'stand out') with their limited resources, in order to be profitable enterprises, while creating social value. We analyse in-depth interviews to senior members of twenty-one UK-based social enterprises, and we find that for many SEs involved in legitimisation exercise through the supportive system, collective system, and stakeholders' impression. By outlining the integrated framework on stakeholder engagement for hybrid legitimacy, we found that (i) legitimisation exercise through collective sharing of SE identity help to build SE image and legitimise SE socially driven mission, while (ii) legitimisation through supportive system (resources and business advantage) help building credibility by demonstrating SE capability to grow economically.

Balancing Legitimacy in a Context of Nonprofit-Business Hybridity: The Case of the Flemish Wellbeing and Social Economy Sector

“…Thus in our research, looking from the perspective of legitimacy as a perception, we want to find out which legitimacy issues are relevant for different types of stakeholders, and whether these are connected to the findings we reviewed above. If this claim is valid, nonprofit-business hybridity may strengthen nonprofit legitimacy for some stakeholders, while weakening it in the eyes of others, thereby leading to legitimacy paradoxes (Balanoff, 2013;Granados & Rosli, 2020).…”

Social Impact Scaling Strategies in Social Enterprises: A Systematic Review and Research Agenda

“…Another crucial attribute of a SE ecosystem is the presence of a coalition, defined as a formal or informal network of various individuals and/or organizations, which aims to tackle complex social problems collaboratively (Dees et al, 2004;Salignac et al, 2018). Scholars show that some SEs take a more leadership role and build a new coalition from scratch (Becker et al, 2017;Perrini et al, 2010), while others take a more participant role and help to sustain a coalition by participating in regular activities that underlie the coalition (Granados and Rosli, 2020;Phillips et al, 2019). By helping to build/sustain a coalition, a SE facilitates the sharing and exchanging of good practices of addressing various social problems (Lyon and Fernandez, 2012;Hillman et al, 2018).…”

“…By helping to build/sustain a coalition, a SE facilitates the sharing and exchanging of good practices of addressing various social problems (Lyon and Fernandez, 2012;Hillman et al, 2018). Such a coalition also aids social entrepreneurs to validate their business models and increase their confidence in implementing social mission (Granados and Rosli, 2020) and obtain more collaboration opportunities (Montgomery et al, 2012).…”

“…For example, a leading Australian SE in the construction industry helped several young SEs gain the legitimacy required to bid for private and public contracts by helping them measure and evaluate their social impact (Barraket, 2020). Similarly, Granados and Rosli (2020) show that, in the UK, a few reputed SEs helped to build the legitimacy of other less-reputed SEs in the market by promoting their products/services to potential clients and partners.…”

“…As an overarching strategy, ecosystem growth strategy includes several more specific strategies that focus on growing or sustaining a supportive SE ecosystem as a means to make positive changes in society through activities such as organizing advocacy campaigns, developing and disseminating valuable knowledge and research, providing training and advisory services to other SEs, helping young and lessreputed SEs to gain and maintain legitimacy, etc. (e.g., Islam, 2020b;Bauwens et al, 2020;Bloom and Chatterji, 2009;Granados and Rosli, 2020;Maseno and Wanyoike, 2020;Westley et al, 2014).…”