Being for Profit, Non-profit, or Both? The Risk Advantage of Social Enterprises in the Face of Shocks

Social enterprises experience tensions triggered by the incorporation of both a commercial and a socio-environmental logic. This may threaten their functioning during ordinary times. Yet, in the face of shocks, their dual nature may prove an advantage compared to their for-profit and non-profit counterparts. Building on research on institutional logics and uncertainty, we theorize that these organizations, in view of the knowledge, resources, competencies and relations they possess in both economic and social domains, face less risk compared to for profit and non-profit organizations when shocks call them to deal with unexpected demands from both spheres. We believe such theorization could talk to literature on hybrid organizations and risk, on for-profit and non-profit organizational forms, and on ethical issues in the creation of social impact.