Self-Interest vs. Social Interest: How Cognitive Moral Development Influences Opportunity Recognition and Performance for Social Entrepreneurs

Author/Creator

Author/Creator ORCID

Date

2019-04-08

Department

Business and Management

Program

Doctor of Philosophy

Citation of Original Publication

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Abstract

This dissertation is aimed at exploring the enablers of successful performance for social entrepreneurs which have been missing in the literature. It has been observed that most social enterprise firms do not grow (Han & McKelvey, 2016) and that the performance record of existing small social entrepreneurship firms has been weak (Katre & Salipante, 2012; Lichtenstein, Carter, Dooley, & Gartner, 2007). The literature states that about 40% of social ventures fail in their first five years (Headd & Kirchhoff, 2009; Katre & Salipante, 2012; Kleiman & Rosenbaum, 2007). As a result of the above, studying the success factors of social entrepreneurs becomes important. The phenomenal growth in the past two decades of the practice of social entrepreneurship has, unfortunately, not been matched with a corresponding growth in the scholarship of social entrepreneurship (Starnawska, 2016). Being overly preoccupied with definitional debates about who the social entrepreneur is, or what elements constitute the boundaries of social entrepreneurship, has hindered the advancement of solid theory building in the literature and consequently prevented the achievement of a unifying framework for social entrepreneurship researchers (Dacin, Dacin, & Tracy, 2011; Nicolopoulou, 2014; Short, Moss, & Lumpkin, 2009) Therefore, by employing a multi-theoretical approach, I present a model which explores how social entrepreneurs’ cognitive and motivational processes impact their processes of recognizing social opportunities and needs in society, and how the interplay of these factors predicts both financial performance and social impact achieved by social entrepreneurs. Specifically, the social entrepreneur’s cognitive moral development (CMD)–described as the cognitive process that motivates an individual to help others in search of a common good (Mair & Noboa, 2006)–is hypothesized to be related to the pursuit of internally-stimulated or externally-stimulated opportunity recognition. Further, CMD is hypothesized to be related to the financial performance of social entrepreneurs and the social impact created by social entrepreneurs respectively. Finally, pursuing internally stimulated opportunities or externally-stimulated opportunities is hypothesized to be related to social entrepreneurs’ financial performance and social impact. An online survey was administered to a total of 1,110 B Corps in the United States, and results are based on data collected from 167 respondents. B Corps are social entrepreneurs who have been certified by B Lab, an independent organization which assesses, scores, and certifies social entrepreneurs. The findings of this study provide empirical evidence of the positive relationship between CMD and internally-stimulated opportunities. The first chapter of this dissertation is the introduction while chapter 2 contains a detailed review of the literature on social entrepreneurship and the variables of interest to this study. Chapter 3 presents the formal hypotheses. Chapter 4 details the research methodology while the results of the statistical tests are presented in chapter 5. Chapter 6 presents a discussion of the results, theoretical and practical implications, limitations, and offers future research directions. The study conclusions are presented in Chapter 7.