Social Enterprise

Social Enterprise is a featured research topic and an initiative at Harvard Business School.

HBS pioneered the concept of “social enterprise” with the founding of its Social Enterprise Initiative (SEI) in 1993. Under the early leadership of James Austin on the importance of collaborative relationships to the success of nonprofits and Allen Grossman and V. Kasturi “Kash” Rangan on new directions in nonprofit strategy, we adopted a problem-focused approach toward understanding the challenges associated with driving sustained, high-impact social change. Current research focuses on leadership of socially mission-driven organizations; the role of business leaders and corporate citizenship in driving social change; business models that address poverty; management of high-performing K-12 public school districts; and financing models for the non-profit sector.

  1. Stock Price Synchronicity and Material Sustainability Information

    Jody Grewal, Clarissa Hauptmann and George Serafeim

    We examine if, and under what conditions, disclosure of sustainability information identified as investor relevant by market-driven innovations in accounting standard setting is associated with stock prices reflecting more firm-specific information and thereby lower synchronicity with market and industry returns. We find that firms voluntarily disclosing more sustainability information, identified as material by the Sustainability Accounting Standards Board (SASB), have lower stock price synchronicity. This result is stronger for firms with higher exposure to sustainability issues, institutional and socially responsible investment fund ownership, and coverage from analysts with less firm-specific experience and lower portfolio complexity. Moreover, we find intra-industry information transfers to firms with low sustainability disclosure within industries with high sustainability disclosure. We also document that sustainability information not identified by the accounting standard setting process is not associated with stock price synchronicity.

    Keywords: sustainability; sustainability reporting; corporate accountability; corporate social responsibility; corporate governance; asset pricing; stock price; information; Voluntary Disclosure; accounting; accounting standards; Environmental Sustainability; Corporate Disclosure; Corporate Accountability; Stocks; Price; Corporate Social Responsibility and Impact; Accounting; Standards;


    Grewal, Jody, Clarissa Hauptmann, and George Serafeim. "Stock Price Synchronicity and Material Sustainability Information." Harvard Business School Working Paper, No. 17-098, May 2017. View Details
  2. SKS Microfinance (Abridged)

    Shawn Cole and Theresa Chen

    Vikram Akula, CEO of SKS Microfinance, seeks a venture capital investment to fund his firm. SKS, one of the largest and fastest growing microfinance institutions in India, is a profitable, for-profit institution with a social mission. In what is one of the first commercial financing deals in the world, Akula must decide at what value to sell equity in SKS, and to whom to sell it. The case focuses on valuation, which is difficult because at the time there are no publicly traded comparable companies, and the strategic aspects of raising money.

    Keywords: For-Profit Firms; Venture Capital; Microfinance; Corporate Social Responsibility and Impact; Valuation; Financial Services Industry; India;


    Cole, Shawn, and Theresa Chen. "SKS Microfinance (Abridged)." Harvard Business School Case 217-069, March 2017. View Details
  3. CEO Activism (A)

    Michael W. Toffel, Aaron K. Chatterji and Julia Kelley

    This case introduces CEO activism, a phenomenon in which business leaders engage in political or social issues that do not relate directly to their companies. The case uses several examples to describe why business leaders are engaging in CEO activism and the potential benefits and drawbacks: (1) how Angie’s List’s CEO responded to the state of Indiana passing a controversial religious freedom law; (2) how Duke Energy’s CEO supported pending U.S. legislation addressing climate change, and (3) how Chobani Yogurt’s CEO publicly supported refugees. Students are then provided with the situation faced by PayPal CEO Dan Schulman after North Carolina passed House Bill 2, which Schulman perceived as discriminatory against LGBTQ (lesbian, gay, bisexual, transgender, and queer) individuals. Students are asked to consider whether Schulman should engage in CEO activism and, if so, how best to approach the situation. The (B) case provides an update on Schulman’s decision.

    Keywords: Leadership & Corporate Accountability; leadership; environmental and social sustainability; environment; climate change; Gender equality; Communication Strategy; Moral Sensibility; Values and Beliefs; Leadership; Law; Rights; Risk Management; Media; Corporate Social Responsibility and Impact; Religion; Expansion; Strategy; Consumer Products Industry; Electronics Industry; Technology Industry; United States; Indiana; North Carolina;


    Toffel, Michael W., Aaron K. Chatterji, and Julia Kelley. "CEO Activism (A)." Harvard Business School Case 617-001, March 2017. View Details
  4. Walmart: Navigating a Changing Retail Landscape

    Michael E. Porter and Jorge Ramirez-Vallejo

    As the largest company, by revenue, in the world, Walmart has been a lightning rod for criticism. However, in an attempt to stay ahead of traditional and digital retailers, and keep customers satisfied with evolving demands, the company is strengthening its competitive advantage by creating Shared Value. Current CEO, Doug McMillon outlines his strategy for fending off competition, navigating a challenging retail landscape, and positioning Walmart as a leading retailer for today and the future.

    Keywords: shared value; strategy; Retail industry; department stores; sustainability; social responsibility of business; Value Creation; Competitive Strategy; Corporate Social Responsibility and Impact; Retail Industry;


    Porter, Michael E., and Jorge Ramirez-Vallejo. "Walmart: Navigating a Changing Retail Landscape." Harvard Business School Case 717-474, March 2017. (Revised March 2017.) View Details
  5. What's the Value of a Like?: Social Media Endorsements Don't Work the Way You Might Think

    Leslie John, Daniel Mochon, Oliver Emrich and Janet Schwartz

    Brands spend billions of dollars a year on lavish efforts to establish and maintain a social media presence. But do those campaigns actually increase revenue? New research provides an answer to this question, which has vexed marketers ever since social media burst upon the scene. In a series of experiments, the researchers tested four increasingly interactive ways in which Facebook might affect customers’ behavior. First, they explored whether liking a brand—passively following it—makes people more likely to purchase it. Second, they examined whether people’s likes affect their friends’ purchasing. Third, they looked at whether liking affects things other than purchasing (for example, whether it can persuade people to engage in healthful behaviors). And fourth, they tested whether boosting likes by paying to have branded content displayed in followers’ news feeds increases the chances of meaningful behavior change. The results were clear: Merely liking a brand neither increases purchasing nor spurs friends to purchase more. Supporting likes with branded content, however, can prompt meaningful behavior change.

    Keywords: Social Enterprise; Social and Collaborative Networks; Consumer Behavior; Marketing Strategy; Online Advertising;


    John, Leslie, Daniel Mochon, Oliver Emrich, and Janet Schwartz. "What's the Value of a Like? Social Media Endorsements Don't Work the Way You Might Think." Harvard Business Review 95, no. 2 (March–April 2017): 108–115. View Details
  6. Gapponshugi in Global Perspective: Debating the Responsibility of Capitalism

    G. Jones

    This chapter places the concepts of ethical capitalism developed by the 19th century Japanese venture capitalist Shibusawa Eiichi in a global historical perspective. The chapter reviews the similarities and differences over time and between countries of proponents of corporate responsibility, including Andrew Carnegie and Robert Anderson in the United States, Paul Rijkens in Europe, and Jamnalal Bajaj in India, as well as HBS Deans Wallace Donham and Donald David. It shows that there were quite different drivers that led business leaders to advocate corporate responsibility. Often strong religious and spiritual values were the principal justification, although Shibusawa Eiichi himself framed his arguments in secular terms. In the United States, fears of government intervention if business was perceived as acting badly also drove some to advocate corporate responsibility.

    Keywords: corporate responsibility; Business ethics; business history; Ethics; Business and Stakeholder Relations; Business History; Corporate Social Responsibility and Impact;


    Jones, G. "Gapponshugi in Global Perspective: Debating the Responsibility of Capitalism." Chap. 7 in Ethical Capitalism: Shibusawa Eiichi and Business Leadership in Global Perspective, edited by Patrick Fridenson and Takeo Kikkawa, 144–169. Toronto: University of Toronto Press, 2017. View Details
  7. Akshaya Patra: Impact at Scale

    V. Kasturi Rangan and Sarah Appleby

    Keywords: social enterprise; scaling; Public-private partnership; operational excellence; Social Enterprise; Growth and Development Strategy; Business and Government Relations; Performance Effectiveness; India;


    Rangan, V. Kasturi, and Sarah Appleby. "Akshaya Patra: Impact at Scale." Harvard Business School Case 517-028, February 2017. (Revised May 2017.) View Details
  8. Royal DSM: From Continuous Transformation to Organic Growth

    William W. George, Carin-Isabel Knoop and Amram Migdal

    Royal DSM CEO Feike Sijbesma was pondering the challenges of shifting DSM’s global organization from the constant transformations of the past 100 years to creating organic growth. When Sijbesma took the helm as CEO in 2007, he further pushed and completed the company’s final moves away from commodity chemicals and toward more sustainable businesses whereby DSM could create value with differentiated offerings. Sijbesma emphasized innovation and moving into “sunrise” businesses that would fuel future growth by playing a positive role in the broader society. Sijbesma asked himself, did DSM’s current portfolio in life sciences and materials sciences provide sufficient growth opportunities to sustain consistent and superior performance? Would DSM’s 21,000 employees worldwide embrace the DSM Strategy 2018: “Driving profitable growth through science-based sustainable solutions,” anchored via the Lead & Grow support and development program for key managers of the company? Should DSM continue making moves in mergers and acquisitions (M&A) to complement organic growth, or could its growth goals be achieved by focusing on organic growth for now, followed later by M&A activities again? What new markets should it look to in order to ensure sustainable growth? Sijbesma felt that after a decade of transformations (divestments and acquisitions), it would be healthy for the company to focus fully on organic growth for several years. During that period, the company had already indicated it would divest three of its major holdings in joint venture companies, which would generate the financial capacity for M&A activities again in later years. In the meantime, Sijbesma wanted the company to prove it could grow organically as well.

    Keywords: organic growth; Organizational change; M&A; mergers and acquisitions; divestment; Business Ventures; Business Divisions; Business Growth and Maturation; Restructuring; Change; Change Management; Transformation; Transition; Engineering; Chemicals; Mining; Ethics; Values and Beliefs; Finance; Capital Markets; Financial Markets; Food; Globalization; Global Strategy; Globalized Firms and Management; Globalized Markets and Industries; Health; Nutrition; History; Leadership; Leadership Development; Leadership Style; Leading Change; Management; Business or Company Management; Growth and Development Strategy; Growth Management; Management Practices and Processes; Management Style; Organizations; Corporate Social Responsibility and Impact; Mission and Purpose; Organizational Change and Adaptation; Organizational Culture; Organizational Design; Ownership; Public Ownership; Performance; Strategy; Adaptation; Consolidation; Corporate Strategy; Value; Value Creation; Biotechnology Industry; Chemical Industry; Food and Beverage Industry; Mining Industry; Pharmaceutical Industry; Europe; Netherlands;


    George, William W., Carin-Isabel Knoop, and Amram Migdal. "Royal DSM: From Continuous Transformation to Organic Growth." Harvard Business School Case 317-063, January 2017. (Revised March 2017.) View Details
  9. Vox Capital: Pioneering Impact Investing in Brazil

    Julie Battilana, Marissa Kimsey, Falko Paetzold and Priscilla Zogbi

    Vox Capital was the first certified impact investing fund in Brazil. Founded in 2009, it provides early-stage capital for companies offering innovative and scalable solutions to enhance the lives of low-income Brazilians, while aiming to simultaneously generate attractive market-rate financial returns for investors. This case examines the evolution of Vox Capital, across understanding the landscape, launching, raising funds, selecting investees, structuring deals, building investee capacities, tracking performance, developing internal systems, and advancing the field of impact investing.

    Keywords: impact investing; Brazil; social enterprise; social performance measurement; Social Entrepreneurship; Investment Funds; Brazil;


    Battilana, Julie, Marissa Kimsey, Falko Paetzold, and Priscilla Zogbi. "Vox Capital: Pioneering Impact Investing in Brazil." Harvard Business School Case 417-051, January 2017. View Details
  10. United Housing—Otis Gates

    Steven Rogers and Mercer Cook

    Otis Gates, the only African-American in his HBS graduating class, is an entrepreneur from greater Boston area and has built a successful affordable housing firm. Along the way, he and his partners have contributed countless hours of community service to the neighborhoods in which they own properties. Now 80 and ready to retire, Gates is creating a request for proposal for his firm. In doing so, he has to evaluate his firm’s total value and decide whether their social-good mission is helping or harming their bottom line.

    Keywords: affordable housing; real estate; community engagement; social-good; request for proposal; diversity; entrepreneurship; Social Entrepreneurship; Moral Sensibility; Fairness; Corporate Entrepreneurship; Housing; Real Estate Industry;


    Rogers, Steven, and Mercer Cook. "United Housing—Otis Gates." Harvard Business School Case 317-059, January 2017. View Details
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