Social Enterprise Performance: The Role of Market and Social Entrepreneurship Orientations

Abstract

Market orientation has been presented as an important predictor of business performance, and it is presumed to contribute to long-term success in both profit-oriented and non-profit enterprises. Similarly, entrepreneurial orientation is a concept that has been widely applied to business firms but has not been empirically tested in social enterprises. Moreover, the literature does not present a widely accepted and tested conceptual model relating entrepreneurial orientation, market orientation and performance, in the realm of social enterprises. In order to fill this gap, this research assesses how these strategic orientations affect social and economic performance in the setting of social enterprises. Structural equation modeling was used as a means to analyze the hypothesized relationships. After testing the model on a sample of 805 Portuguese social enterprises, the findings show that both social entrepreneurship and market orientations significantly impact social performance. The results also indicate that market orientation mediates the effect of social entrepreneurship orientation on the performance of social enterprises.