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. The Value of Corporate Citizenship: Protection

    Dylan Minor

    We explore the notion that corporate citizenship, as obtained through Corporate Social Responsibility (CSR), is used by managers to protect firm value, helping their firm better withstand negative business shocks. We formally explore two parallel mechanisms for such protection .one of building moral capital (CSR Contributions) and another of improving investor posteriors (CSR Investments). We find some theoretical and empirical support for both of these, but in different settings. In particular, we find that firms with higher CSR Investments enjoy an average of $1 billion of saved firm value upon an adverse event. In contrast, CSR Contribution firms lose value (on average) upon an event, possibly due to disingenuous contributions. Meanwhile, due to managerial moral hazard, firms with high levels of CSR Contributions face adverse events more often, whereas those with high levels of CSR Investments face them less often.

    Citation:

    Minor, Dylan. "The Value of Corporate Citizenship: Protection." Harvard Business School Working Paper, No. 16-021, August 2015. View Details
  2. Corporate Governance and Executive Compensation for Corporate Social Responsibility

    Bryan Hong, Zhichuan (Frank) Li and Dylan B. Minor

    We link the corporate governance literature in financial economics to the agency cost perspective of Corporate Social Responsibility (CSR) to derive theoretical predictions about the relationship between corporate governance and the existence of executive compensation incentives for CSR. We test our predictions using novel executive compensation contract data, and find that firms with more shareholder-friendly corporate governance are more likely to provide compensation to executives linked to firm social performance outcomes. Also, providing executives with direct incentives for CSR is an effective tool to increase firm social performance. The findings provide evidence identifying corporate governance as a determinant of managerial incentives for social performance, and suggest that CSR activities are more likely to be beneficial to shareholders, as opposed to an agency cost.

    Keywords: corporate governance; corporate social responsibility; incentives for CSR; Executive Compensation; non-financial performance measures; agency costs; board independence; institutional holdings; managerial power;

    Citation:

    Hong, Bryan, Zhichuan (Frank) Li, and Dylan B. Minor. "Corporate Governance and Executive Compensation for Corporate Social Responsibility." Harvard Business School Working Paper, No. 16-014, August 2015. View Details
  3. Team Rubicon: Bridging the Gap from Startup to National Organization

    Leonard A. Schlesinger and Dan Nidess

    Team Rubicon, a military veteran volunteer disaster relief organization, has experienced significant success in attracting attention and support in its first 4 years of operation. The challenges of managing the volunteer base, the cost of responding to disasters and the evolution of the organization raise significant strategic and organizational issues for the founding team.

    Keywords: Organizational Change and Adaptation; growth strategy and execution; disaster relief; NGO; Organizational Change and Adaptation; Growth and Development Strategy; Growth Management; Non-Governmental Organizations;

    Citation:

    Schlesinger, Leonard A., and Dan Nidess. "Team Rubicon: Bridging the Gap from Startup to National Organization." Harvard Business School Case 315-124, June 2015. View Details
  4. Denver Museum of Nature & Science

    Jill Avery and Jim Rosenberg

    Digital was on Vice President of Strategic Partnerships and Programs Bridget Coughlin's mind these days. DMNS had been dabbling in digital for the past few years, but had never fully committed to it. The time had come to establish a strategic vision, and to decide whether to designate serious human and financial resources. It was time to make some decisions about the DMNS' digital future. The digital discussion was taking place within a larger strategic conversation about the primacy of the onsite experience of the Museum and the need to get outside of its walls to reach new constituents. How should she balance onsite programming, offsite programming, and online programming to maximize attendance and deliver against the Museum's mission? Was digital the magic pill that would allow the Museum to reach new audiences or was DMNS better off delivering a face-to-face museum experience within its own four walls or out on the streets of the Denver community?

    Keywords: marketing; digital; social media; marketing strategy; nonprofit; Arts; Education; Marketing; Marketing Communications; Marketing Strategy; Nonprofit Organizations; Education Industry; North America; United States;

    Citation:

    Avery, Jill, and Jim Rosenberg. "Denver Museum of Nature & Science." Harvard Business School Case 315-081, June 2015. View Details
  5. Colgate-Palmolive Company: Marketing Anti-Cavity Toothpaste

    John A. Quelch and Margaret L. Rodriguez

    In October 2013, Colgate-Palmolive Company, the world's leading oral care company, was about to launch its new Colgate® Maximum Cavity Protection™ plus Sugar Acid Neutralizer™ toothpaste in Brazil. Oral care category accounted for 46 percent of Colgate's $17.4 billion sales worldwide in 2013. The new toothpaste was clinically proven to reduce and prevent cavities more effectively than toothpaste with the same level of fluoride alone. All major industry players, including Procter & Gamble, GlaxoSmithKline and Colgate itself, had long ago launched products with the maximum amount of fluoride allowed by Health authorities. Yet cavities remained a significant threat to public health in many countries, both developing and developed. As Suzan Harrison, Colgate's president of Oral Care, prepared to launch CMCP+SAN in Brazil, the world's third largest oral care market, her executive team was divided over the product's positioning and pricing. Should it be positioned as a basic product to maximize reach for its health benefits or as a premium product for consumers who sought superior cavity protection?

    Keywords: marketing; new product management; Consumer segmentation; global marketing; corporate social responsibility; healthcare; sustainability; Health Care and Treatment; Environmental Sustainability; Marketing; Segmentation; Product Development; Product Launch; Corporate Social Responsibility and Impact; Consumer Products Industry; Brazil; United States;

    Citation:

    Quelch, John A., and Margaret L. Rodriguez. "Colgate-Palmolive Company: Marketing Anti-Cavity Toothpaste." Harvard Business School Case 515-050, May 2015. (Revised May 2015.) View Details
  6. The Columbus Partnership

    Jan W. Rivkin

    The Columbus Partnership, a civic alliance bringing together the heads of roughly 50 leading organizations in central Ohio, has made strides in developing the region's economy. But a stinging defeat at the ballot box has set back the Partnership's efforts to improve local public education. As the case opens in May 2014, the Partnership's leaders must decide whether to continue to try to improve public education and, if so, how.

    Citation:

    Rivkin, Jan W. "The Columbus Partnership." Harvard Business School Case 715-462, May 2015. View Details
  7. Mobile Money Services—Design and Development for Financial Inclusion

    Rajiv Lal and Ishan Sachdev

    Mobile money services are being deployed rapidly across emerging markets as a key tool to further the goal of financial inclusion. Financial inclusion, the development of novel methods to enable individuals at the base of the pyramid to access formal financial services and become part of the formal financial system, is considered a key prerequisite for lifting these populations out of poverty and for driving economic growth.

    Keywords: Social Marketing; Poverty; Emerging Markets; Product Launch; Economic Growth; Financial Services Industry;

    Citation:

    Lal, Rajiv, and Ishan Sachdev. "Mobile Money Services—Design and Development for Financial Inclusion." Harvard Business School Working Paper, No. 15-083, April 2015. (Revised July 2015.) View Details
  8. The Type of Socially Responsible Investments That Make Firms More Profitable

    George Serafeim

    Keywords: sustainability; corporate social responsibility; corporate sustainability; Investing; investment; investment management; Corporate Social Responsibility and Impact; Profit; Investment; Environmental Sustainability;

    Citation:

    Serafeim, George. "The Type of Socially Responsible Investments That Make Firms More Profitable." Harvard Business Review (website) (April 14, 2015). View Details
  9. Should Business Have Human Rights Obligations?

    Nien-he Hsieh

    Businesses and their managers are increasingly called upon to take on human rights obligations. Focusing on the case of multinational enterprises (MNEs), the paper argues we have reason to reject assigning human rights obligations to business enterprises and their managers. The paper begins by distinguishing business and human rights from the more general topic of corporate responsibility. Following Buchanan (2013), the paper takes the ideal of status egalitarianism to be central to human rights. Status egalitarianism holds that all members of society stand as moral equals in relation to one another and that the state has a duty to recognize and protect that equal standing both in its dealings with citizens and in their dealings with one another. To assign human rights obligations to MNEs and their managers risks undermining this ideal. The paper situates this argument in relation to the United Nations "Protect, Respect and Remedy" Framework by discussing the way in which MNEs can be complicit in state failures to protect citizens. The paper argues that avoiding complicity should be the appropriate focus of managerial responsibility.

    Keywords: human rights; Ruggie Principles; corporate responsibility; multinationals; Rights; Multinational Firms and Management; Corporate Social Responsibility and Impact;

    Citation:

    Hsieh, Nien-he. "Should Business Have Human Rights Obligations?" Special Issue on Business and Human Rights. Journal of Human Rights 14, no. 2 (April–June 2015): 218–236. View Details
  10. Statoil: Transparency on Payments to Governments

    George Serafeim, Paul M. Healy and Jérôme Lenhardt

    The Statoil case describes the challenge of increasing transparency, in extractive industries, around host county government payments. The case describes Statoil's reasoning behind voluntarily disclosing host country government payments, and the events that led to this decision. It also articulates how both management and the board were thinking about difficult trade-offs in terms of costs and benefits in making this decision.
    The case also describes self-regulatory and regulatory efforts to increase transparency. The first was the Extractive Industries Transparency Initiative (EITI), which is a set of reporting standards published by a coalition of companies, governments and non-governmental organizations (NGOs). The second was legislation enacted in the United States under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), which requires certain disclosures by natural resource extractive companies that are subject to the reporting requirements of the US Securities and Exchange Commission (SEC). The SEC issued a final rule implementing the Dodd-Frank Act in 2013 but that rule had most recently been vacated by the US District Court and is now subject to being re-written by the SEC.
    Therefore, the case allows for a discussion of firm-specific voluntary, industry self-regulatory and regulatory efforts in increasing transparency in extractive industries.

    Keywords: corruption; disclosure; disclosure strategy; regulation; industry self-regulation; corporate governance; corporate accountability; bribery; sustainability; corporate social responsibility;

    Citation:

    Serafeim, George, Paul M. Healy, and Jérôme Lenhardt. "Statoil: Transparency on Payments to Governments." Harvard Business School Case 115-049, March 2015. View Details
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