Abstract
The relevance of this study lies in the fact that financial risk is a serious obstacle to the development of social entrepreneurship, preventing the implementation of potential support for sustainable development goals in business. The purpose of this article is to clarify specific aspects of financing factors and financial risk related to social entrepreneurship in developing countries (in comparison with the standard financial risk related to commercial entrepreneurship) in order to analyze the influence of the financing factors of social entrepreneurship on sustainable development, as well as to determine the potential for the development of social entrepreneurship through financial risk management. To achieve this goal, this article uses the methodology of econometrics—dataset modelling of financial risk management in social entrepreneurship to achieve sustainable development in emerging economies. On the basis of the results of this study, firstly, it is substantiated that the financial risks entailed by social entrepreneurship differ from the standard financial risk present in commercial entrepreneurship. Specific factors of the financing of sustainable development in emerging economies are determined and, on the basis of this, financial risks specific to social entrepreneurship in emerging economies are identified as follows: (1) reduced stimulus to use financial resources in long-term investments, which disrupts the stability and decreases inclusion; (2) joint public–private investments and decreased investment in R&D; and (3) expanded investment in the skills required for jobs and “markets of tomorrow”. Secondly, a contradictory influence of financing factors on sustainable development is demonstrated. Thirdly, a large potential for the development of social entrepreneurship by means of financial risk management (maximum reduction) was identified. With the minimization of financial risk, social entrepreneurship would demonstrate substantial progress, with an increase of 99.61% (more than 50%) from 45.18 points to 90.18 points. A novel contribution of this paper to the extant literature consists of the specification of the essence and specifics of social entrepreneurship in emerging economies through the identification of financial risks and the provision of recommendations for their management.
Highlights
The purpose of this article is to clarify specific financing factors and financial risks related to social entrepreneurship in developing countries, to analyze the influence of the financing factors related to social entrepreneurship on sustainable development, and to determine the potential for social entrepreneurship development through financial risk management
The theoretical basis of this research is the concept of financial risk and risk management, sustainable development, and social entrepreneurship
This paper aims to perform the dataset modelling of the financial risk management in social entrepreneurship for sustainable development in emerging economies
Summary
Social entrepreneurship is a special type of business that incorporates the individual or simultaneous implementation of the following directions of activity: (1) corporate social responsibility; (2) corporate ecological responsibility; (3) non-commercial activities (including charity) towards the provision of public and socially important benefits. Financial risks are a serious obstacle to the development of social entrepreneurship, preventing the implementation of potential support for sustainable development goals in business. This is the problem addressed by this research. The following issues hinder the development of solutions to this problem
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