Downward accountability to beneficiaries in social enterprises: do partnerships with nonprofits boost it without undermining accountability to other stakeholders?

Abstract

The hybrid nature of social enterprises gives them a high potential for developing social innovations, but at the same time leads to tensions within these organizations. The barriers they face to gain access to traditional sources of funding are pushing social enterprises to reinforce their business models and rely more on commercial activities, and this fact increases the risk of mission drift and can weaken accountability towards beneficiaries of the social mission in favor of dominant stakeholders such as funders or clients of the commercial activities. Our research attempts to analyze whether partnerships between social enterprises and nonprofits strengthen accountability to beneficiaries without hindering accountability to other stakeholders, thus allowing both social and economic objectives to operate together. Based on a survey with a sample of social enterprises partnering with nonprofits, results reveal that as the partnership moves along a collaboration continuum to a transformational stage, accountability to beneficiaries is encouraged, whereas accountability to other types of stakeholders is also improved or, at least, not affected.