Challenges Facing Social Enterprises in the United States

Alan J. Abramson · Kara Clifford Billings

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Entrepreneurship Studies and Influences Nonprofit Sector and Volunteering Community Development and Social Impact

Abstract

Abstract Hybrid organizations that combine social purpose and profit motive appear to have grown significantly in number in the U.S. in recent decades. However, these organizations, which we call “social enterprises,” face challenges that impede their growth and hinder their ability to deliver greater benefits. To better understand what these challenges are, this paper surveys the growing literature on social enterprises which suggests that social enterprises now face these major obstacles: ill-fitting legal forms, obstacles to effective governance, problems in evaluating impact, weak supportive networks, difficulties in raising funding, and management tensions. Deepening understanding of the challenges facing social enterprises should help guide those interested in strengthening public policy toward social enterprise and other aspects of the support system for these organizations.

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References

2010Building Sustainable Hybrid Organizations: The Case of Commercial Microfinance Organizations 2014Advancing Research on Hybrid Organizing – Insights from the Study of Social Enterprises 2000The Ownership of Enterprise 2014The governance of social enterprises: Mission drift and accountability challenges in hybrid organizations 2014Harnessing Productive Tensions in Hybrid Organizations: The Case of Work Integration Social Enterprises 2012The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations, and the Public 2014What Impact? A Framework for Measuring the Scale and Scope of Social Performance 2015Making Hybrids Work: Aligning Business Models and Organizational Design for Social Enterprises

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