Sustainability 2017, 9, 1427 3 of 15
purposes, which includes reinvesting in the community [
26
,
30
–
32
]. These two purposes are aimed
to be fulfilled simultaneously, as both allow profit gain in a market economy [
31
,
33
]. The part of the
profit distributed to several shareholders is the enterprise’s reinvestment for social and environmental
purposes [
34
]. Social enterprise emphasizes that the main goal of a company or organization is for
social purposes, such as providing social services for a low-income group, creating job opportunities
for women, and caring for homeless people, juvenile delinquents, and disabled persons [
31
,
35
,
36
].
Social enterprises carry out these activities using the reinvestment for society instead of asking for
government subsidy [33].
Social enterprises emerge and maintain company and social services through the social innovation
process [
13
,
15
,
37
,
38
]. The social entrepreneur and social entrepreneurship constitute the majority
of social innovations, that is, the innovative thoughts and decision-making process for social
purposes [
37
,
39
–
41
]. To solve social problems, social entrepreneurs devise new products using
appropriate technology. Moreover, new social service models and working processes are innovated [
42
].
Social innovation is possible in any government, economic and social institution, as well as any
NGO, NPO, private company, and so on [
43
,
44
]. Among these institutions, the social enterprise
is a typical organization that implements social innovation [
25
]. The social enterprise differs from
other organizations of the public sector because it focuses on niche sectors existing in the ineffective
parts of the market sector or those undersupplied by the government [
13
]. The innovative thoughts
of a social entrepreneur should aim to discover the item in the niche sector between the market
and the government, to supply goods and services through market mechanisms, and to reinvest in
society [45–47].
Recently, some empirical studies have tried to measure these characteristics and performances of
social enterprise. The dual purpose or value of social enterprise is discussed to verify the singularity of
social enterprise [
46
,
48
]. The performance of social enterprise is evaluated by the holistic framework
including input, organizational capacity, outputs, outcomes, and public value accomplishment [
49
,
50
]
or by the financial framework such as the social return on investment [
51
,
52
] and operating cost [
53
].
In relation to social innovation, the process to solve the social problems [
54
,
55
], the role of innovation
to social impact [
56
], internal implementation factors of social innovation [
57
,
58
], and externally
environmental factors [59] are discussed.
2.2. Social Enterprise and Social Capital
Social enterprise composes the internal governance. The achievement of social purposes has the
role of incentive, covering the economic aspect, on the members of the social enterprise [
15
,
60
–
62
].
The trust of governance is based on transparency, reliability, and democracy [
63
]. A social entrepreneur
positively develops new social values in collaborating with employees, volunteers, and the target
population, thereby enabling solidarity, collaboration, and social capital to sustain the organization
of the social enterprise [
22
,
31
,
64
,
65
]. Social capital is defined as the relational structures and
institutional norms of social bonds and behaviors [
66
–
70
]. Social capital promotes trust in organizations
or communities, and is the foundation of the links between morality and internal norms [
68
].
The usefulness of social capital in social enterprise is verified by the relationship between employees
for inducing the dual purpose [
47
], survival of social enterprise and form of employment [
71
], and
making the intrinsic forces and searching the partner for social purposes [72].
In addition, the local and regional governance is constituted by the relational asset of the social
enterprise. The social enterprise mobilizes resources by forming relational assets with external
stakeholders [
15
,
73
,
74
]. Social ownership involves the collaboration between governance and the
community [
21
,
75
,
76
]. In the privity of contract, a number of business enterprises, other social
enterprises, subcontractors, financial institutions, and social investors are included in the economic
activity [
77
–
79
]. Furthermore, in collaborative relationships, social enterprise contains several NGOs,
NPOs, local and central governments, residents, and the media in social activity [26,80,81].