In pursuit of social purpose and impact: a review of the state of social entrepreneurship and avenues for future research

More than ever, it’s clear that sustainability must be addressed in every aspect of our lives – as consumers, voters and organisational leaders. Businesses, in particular, now face an imperative to create value not only for shareholders but also for employees, customers, communities and the environment. While many business leaders perceive a paradox between economic performance and sustainability, often treating them as mutually exclusive (Rimanoczy, 2020), social enterprises demonstrate the synthesis of these seemingly antithetical organisational logics (Maibom and Smith, 2016; Cornforth, 2014); however, challenges exist when integrating these organisational logics. An integrated, holistic understanding of how social entrepreneurs pursue and sustain social value creation is needed.

Social enterprises have a dual purpose. They strive to tackle social and environmental problems while also engaging in commercial activities to sustain their operations (Ridley‐Duff, 2008, Battilana and Lee, 2014). They are hybrid organisations, combining business and social-welfare institutional logics and organisational forms. This hybridity, in turn, creates persistent internal and external tensions such as legitimacy pressures, risk of mission drift and resource dependence (Battilana and Lee, 2014; Doherty et al., 2014; Pache and Santos, 2013). Some social entrepreneurs reconcile competing institutional logics by decoupling and conforming to a single institutional logic (Mair et al., 2015; Pache and Santos, 2013), while others compartmentalise or loosely couple these competing logics (Cornforth, 2014).

However, selective coupling, in which hybrid organisations adopt and embed practices, structures and symbols drawn from competing institutional logics (rather than decoupling or compromising) seem to be more effective and improve legitimacy (Santos et al., 2015). Strong ideological congruence between competing institutional logics plays a key role in spanning boundaries between different approaches and increases willingness to integrate different logics (Maibom and Smith, 2016). Stakeholder engagement, social accounting (Ramus and Vaccaro, 2017) and governance (Mair et al., 2015) have also been shown to help balance these competing institutional logics and avoid mission drift.

This hybrid focus on value means social enterprises often face difficulties in accessing traditional business financial resources, because many financial institutions and investors do not factor social value creation into the calculations of returns made (Doherty et al., 2014). Limited resources mean social enterprises often struggle to effectively scale their operations and impact delivery, so they remain small to medium in size (Stevens et al., 2015; Aidara et al., 2021; Islam, 2022). However, this means they are often more innovative than large enterprises (Chen, 2007; Naushad, 2022), and are better able to take advantage of informal opportunities (Aidara et al., 2021).

Ultimately, social enterprises face challenges in balancing their hybridity that traditional commercial enterprises simply do not face (Doherty et al., 2014). Many social enterprises suffer from mission drift, a form of strategic failure in which they lose sight of their central goals and objectives, while commercial survival and the desire to scale can erode the core social purpose (Ebrahim et al., 2014; Islam, 2022). This existential threat forces social entrepreneurs to carefully manage internal and external tensions between financial viability and social impact.

Extant literature tends to examine social entrepreneurship in a fragmented manner, considering motivation, ability, capabilities and the opportunities they pursue as separate, discrete aspects. This reductionist perspective, while beneficial in deeply exploring specific aspects of social entrepreneurship, fails to capture the dynamic, holistic, human-centred understanding of social entrepreneurship. Some research centres on the individual and their unique motivations, often narrowly focusing on prosocial drivers while overlooking self-oriented ones (e.g. Baker and Weerakoon, 2024; Mascena Barbosa and Dumont, 2023). Other research concentrates on specific resources and capabilities as drivers of performance (e.g. Sinthupundaja et al., 2020), or on the personal traits of social entrepreneurs, such as passion and competence (e.g. Wu et al., 2023). By treating motivation, ability, and opportunity as separate variables, this approach misses the complex reality where these elements are deeply intertwined, preventing a comprehensive view of how social purpose and impact are truly pursued and sustained. In the next section, we introduce and discuss the Motivation, Ability and Opportunity (MAO) model established by Lewin (1951) and extended by (Bublitz et al., 2020; Grunert et al., 2014; Pieters, 1991; Ölander and Thøgersen, 1995) as superior in the field of social entrepreneurship because of the distinct perspective it offers in regard to factors that together influence human behaviour. This theoretical lens is powerful because it acknowledges that successful social entrepreneurship requires not just the desire to create social change but also the capabilities to implement that change and the contextual circumstances that make such action possible. Therefore, it provides a more holistic perspective than other commonly associated enterprise frameworks (e.g. stakeholder theory, resource dependence theory, social capital theory, effectuation theory, social network theory, etc.).

The MAO model (Lewin, 1951) encapsulates three critical elements that determine whether an individual engages in social entrepreneurial behaviour: the motivation to create social impact, the ability to execute on that motivation through entrepreneurial competencies, and the opportunity to act within a given context. Using the MAO framework to structure this systematic literature review will provide insight into social entrepreneurs’ motivations (why they start and continue), their ability (what competencies they need and how they leverage these resources) and the context of the opportunity (the contextual factors around where they act).

Motivation is one of the main driving forces behind efforts and actions (Covington, 2000). What motivates an entrepreneur to start a social enterprise is likely to be different from what motivates a traditional, or corporate entrepreneur to start a traditional for-profit enterprise (Trivedi and Stokols, 2011). These motivations are more holistic because they are more likely to include ideological positioning, family/community-oriented behaviours, and world views (Ridley‐Duff, 2008). This is because economic concerns are paramount for traditional for-profit entrepreneurs (Trivedi and Stokols, 2011), while pro-social motivation is paramount for entrepreneurs of social enterprises (Trivedi and Stokols, 2011; Omorede, 2014; Jan and Maulida, 2022; Yamini et al., 2022). The extant literature that focuses on social entrepreneurship in general concludes that prosocial motivation is a driving force (Bacq et al., 2022; Arru, 2020). For this reason, this review seeks literature addressing the motivations of entrepreneurs to pursue social purpose and impact.

The ability to be a social entrepreneur stems from an individual’s competencies and capabilities. Entrepreneurial competencies are the blend of knowledge, skills and experience, crucial for performing successful entrepreneurial roles and can be developed through both practical and theoretical learning (Aidara et al., 2021). As many social enterprises remain small to medium, they rely primarily on the leader’s entrepreneurial knowledge and competency (Aidara et al., 2021). Yet there remains no consensus in the literature regarding which theoretical lens – the dynamic capabilities or resource-based view – provides a more effective framework for examining social entrepreneurship.

The resource-based view (RBV) states that internal strengths differentiate enterprises from others in a competitive marketplace. Entrepreneurial competency is one of these crucial resources. However, the RBV ignores the dynamic environment surrounding the creation and development of those resources and the implementation of the enterprise’s competitive strategy (Eisenhardt and Martin, 2000).

Dynamic capabilities (DC) refers to the enterprise’s ability to reconfigure and harmonise internal and external resources, fostering innovation and responsiveness to evolving market conditions (Eisenhardt and Martin, 2000; Pauceanu et al., 2021). Much of the extant literature examines entrepreneurial competencies through an RBV, though some also apply the DC framework. A focus on both may provide new insights not only into the competencies social entrepreneurs possess but also into how they sense opportunities and reconfigure or harmonise resources to remain responsive to evolving market conditions. For this reason, this research seeks literature addressing both the competencies and capabilities of successful social entrepreneurship.

The opportunity for social entrepreneurs to create meaningful impact increasingly depends on their ability to engage in collaborative co-creation with beneficiary communities (Ostertag et al., 2021; Bacq et al., 2022). Resource exchange between stakeholders generates value-creating innovations that drive social impact. This co-creation process requires establishing and nurturing relationships both within the enterprise and with external actors, particularly the beneficiary community (Álvarez-González et al., 2023). It should include coordinating with the broader community (Baker and Weerakoon, 2024), in a trustful network (Cavazos-Arroyo and Puente-Diaz, 2023). By fostering an inclusive and collaborative leadership approach that involves and empowers community members, social entrepreneurs can harness collective efforts to achieve more comprehensive and sustainable social impact (Ostertag et al., 2021). This is reinforced by research showing co-creation occurs most effectively when multiple institutions and organisations cooperate together to create products or services with social impact (Pauceanu et al., 2021; Boeske and Murray, 2022; Mohiuddin and Yasin, 2023). For this reason, this review seeks literature addressing what is known about co-creation.

The justification for this study is to first examine what is known about the interrelationship between the motivation to create social impact, the competencies and capabilities required to achieve it, and the co-creation process with beneficiaries. This will then reveal avenues for future research. Therefore, this study identifies three research questions:

1. What is known about the motivations of social entrepreneurs to pursue social purpose and impact?

2. What is known about the competencies and capabilities of successful social entrepreneurship?

3. What is known about co-creation and its social value and impact?

To engage in a comprehensive, transparents and rigorous review of extant literature, the Preferred Reporting Items for Systematic Reviews and Meta-analysis (PRISMA) methodology was adopted (Page et al., 2021). A comprehensive search of three databases was conducted: Scopus, Web of Science and EBSCO Business Source Complete. Each of these databases has broad, multidisciplinary reach. The following terms were searched in the title, abstract and keyword fields:

• Corpus one: motivation – (“lead*” AND “motivat*” AND (“social enterprise” OR “social value” OR “social impact”)).

• Corpus two: competency and capability – (“lead*” AND (“competenc*” OR “capabilit*”) AND (“social enterprise” OR “social impact” OR “social value”)).

• Corpus three: co-creation – ((“social enterprise” OR “social value” OR “social impact”) AND (“cocrea*” OR “co-crea*” OR “co crea*”)).

The 2020 global pandemic (COVID-19) was a significant event of global disruption and crisis with an existential impact on the consciousness of society and the research community. As one of the most recent, large-scale pandemics, the event heightened awareness of physical and mental health as a result of the rapid spread of the COVID-19 virus around the world. But it also heightened individual and community care and concern for the state of the environment, and the human condition (e.g. Oberoi et al., 2021; Bacq and Lumpkin, 2020; Kamaludin et al., 2022). For this reason, publications from 2020 to 2024 inclusively were sought because it represents a period of enlightenment, crisis and disruption to social entrepreneurship.

The initial searches identified 1082 records. After the removal of duplicate records and those not matching inclusion and exclusion criteria (see Table 1), there were 189 records in the combined corpus.

A preliminary review of titles and abstracts identified 105 records to be excluded because they did not match inclusion and exclusion criteria. This left 84 articles sought for retrieval, all of which were retrieved. A second review of the corpus, this time reviewing the full text, found 28 records that did not match the inclusion and exclusion criteria or were outside the intent of the study. This left 56 records eligible for inclusion in the SLR (Figure 1).

After the preliminary review, the authors analysed the 56 articles using content analysis. This method involved two steps: descriptive analysis of basic article information, including publication year, journal distribution and geographic representation; and thematic analysis to identify and interpret recurring patterns and underlying concepts (Krippendorff, 2019). The authors first read the full texts independently to preliminarily identify themes. They then had discussions to reach consensus on the identified themes and to establish that a point of saturation had been reached. As such, no adjustment to the inclusion and exclusion parameters was required. Following this, the authors conducted a second independent reading. Through subsequent discussions the authors formed consensus on the thematic categorisation of the articles (Table 2).

Of the research methods applied across the 56 articles, 30 articles (54%) used qualitative research design, 18 (32%) used quantitative research methods, 6 (11%) were conceptual articles, and two (4%) used mixed methods. Of the 6 conceptual papers, 3 discussed conceptual frameworks and 3 were literature reviews (Figure 2).

Figure 3 depicts the countries in which the 56 articles originated. The UK and China were both the most highly represented. Europe was the most represented continent with 22 articles drawing data from here, followed by Asia with eight articles and then Oceania, North America, South America and Africa. These findings reveal a significant geographical imbalance in research distribution, with European countries dominating the data set while regions like Africa and South America are substantially underrepresented.

Thematic analysis uncovered five themes; hybrid mission, the entrepreneurial life, resource scarcity and uncertainty, the significance of co-creation, and place-based benefit (summarised in Table 2).

Given the highly interconnected nature of each of the five emerging themes, they have been reconceptualised into a mind map (Figure 4). Discussion of each theme in more detail follows, before outlining what has been revealed for future research.

This theme highlights the nuanced interplay between social and economic objectives. In other words, the hybrid mission of social enterprises. Strategic misfit arises when the organisation’s mission is not reflected in its operational practice (mission-in-practice), or where the motivations of stakeholder groups do not align with the organisation’s mission-in-practice (Akhmedova et al., 2022); it is therefore important to maintain harmonious alignment between these elements, which constitutes a clear focus on social objectives while navigating the complexities of financial viability (Akhmedova et al., 2022). The analysis reveals the dominance of social mission and its implications for engagement of and communication to various stakeholders. The main points of focus include balancing objectives, the primacy of the social mission and the motivations of various stakeholders.

The balancing of social and economic objectives is essential for sustaining the hybrid mission, because it allows organisations to navigate the inherent tensions between competing objectives. Bennouri et al. (2023) discuss how microfinance organisations face trade-offs between social outreach and financial performance, emphasising that excessive focus on commercial objectives can lead to mission drift. Mission drift is a phenomenon where a non-profit or social enterprise, deviates from its original social mission or purpose because the organisation begins to prioritise commercial objectives over its core social objectives, leading to misalignment between its stated mission and actual activities (Bennouri et al., 2023).

Vickers et al. (2024) emphasises that social enterprises often prioritise their social objectives over financial ones, particularly in contexts where beneficiary engagement is essential. Savaget et al. (2024) argues that social entrepreneurs can achieve lasting impact by focusing on local needs, rather than succumbing to pressures for growth and permanence. However, not all studies in this corpus prioritise one over the other. Akhmedova et al. (2022) discusses the concept of “selective coupling” when social enterprises strategically harmonise social mission with economic activities, selectively combining both social and financial logics.

The hybrid mission must be examined in combination with stakeholder perspectives, such as employees. Kluijtmans and Crucke (2024) highlight that when employees feel aligned with the organisational mission, this leads to more positive employee outcomes. Alignment between balancing of the organisation’s hybrid mission and employees’ expectations is crucial for fostering engagement and participation among employees (Kluijtmans and Crucke, 2024).

Credibility of social good messaging correlates with higher intention to purchase from the social enterprise. As such, Becker et al. (2022) emphasises the importance of understanding potential customers, who are one of the more powerful stakeholder groups. Understanding what motivates stakeholders to want to engage is also key for other stakeholder groups like funders and beneficiaries, ensuring the social mission resonates with them (Savaget et al., 2024). Vickers et al. (2024) proposes organisational democracy as a means to involve stakeholders in balancing the hybrid mission because a lack of effective communication regarding this can lead to passive membership.

Lifestyle entrepreneurs are primarily motivated by personal satisfaction, a desire to engage in rewarding activities and aspirations to exercise autonomy and control over their occupation (Ivanycheva et al., 2023). These lifestyle entrepreneurs tend to be intrinsically motivated and prioritise achievement of social purpose goals rather than wealth accumulation (Ivanycheva et al., 2023). Motivations, such as the desire for autonomy and the pursuit of personal passions contribute to the identity of social entrepreneurs (Mascena Barbosa and Dumont, 2023). The analysis of this theme and framing as “the entrepreneurial life” examines the main points of motivation, passion, service and entrepreneurial identity.

Prosocial motivation refers to the desire to have a positive impact on other people, such as promoting social welfare and addressing societal challenges, without self-interested expectations (Au et al., 2023). It is a focal driver of social entrepreneurs, often deeply rooted in a commitment to a specific cause and desire to create social change. For many, the social mission serves as a foundational element for decision-making (Sinthupundaja et al., 2020), acting as a guiding compass essential for navigating the complexities of balancing social and economic objectives. Au et al. (2023) challenges the prevailing notion that prosocial motivation is the sole driver of social entrepreneurs’ success.

Based on a dual-motivation approach discussed by Au et al. (2023), a prosocial-intrinsic motivation (that is, the state of internal motivation where the desire to help others is self-determined) promotes social and business outcomes. Whereas prosocial-extrinsic motivation (characterised as prosocial motivation that is externally controlled and pressure-based) dampens business outcomes, showing that the motivations of these entrepreneurs are complex, nuanced and deeply personal.

Similarly, Mak (2023) groups motivations into two broad categories: “Vision/passion-oriented motivations” which are described as intrinsic and self-focussed; and “Problem-oriented motivations” which are described as extrinsic and other-focussed. Interestingly, Au et al. (2023) found that prosocial-intrinsic motivations lead to better business outcomes, while Mak (2023) concluded that problem-oriented motivations (extrinsic/other-focused) was more likely to lead to entrepreneurs seeking sustainable solutions that lead to positive externalities, and which facilitates empowerment of individuals and groups in powerless or disadvantaged segments of society.

Adding another perspective to the discourse, Mascena Barbosa and Dumont (2023) suggest that the initial motivations guiding an entrepreneur to start a social enterprise might be self-oriented, and not much different from those driving the creation of a commercial enterprise. However, after founding the social enterprise, the interactions with the ecosystem and the reward of prosociality leads to higher levels of prosocial motivation. Wu et al. (2023) describe social entrepreneurial passion as a positive emotion and a significant aspect of self-identification for entrepreneurs regarding their work. Social entrepreneurial passion motivates entrepreneurs to actively seek solutions to social issues and to continue to persist through challenging circumstances. While Zhang et al. (2023) discusses the sense of responsibility that can be the driving force of leader’s social mission. Applying Gidden’s structuration theory, Steiner et al. (2021) finds that social entrepreneurs both shape and are shaped by their structural contexts. In other words, they co-create their environments. These individuals are driven by strong moral and ethical imperatives to address social challenges.

Social entrepreneurs are adept at leveraging scarce resources through bricolage (construction or creation by using a diverse range of available things) to fulfil their mission of producing products and services that generate social value (Liu et al., 2020; Bhardwaj and Srivastava, 2021). It is a strategy used by social entrepreneurs to overcome resource constraints. Driven by their hybrid mission, social enterprises and social entrepreneurs engage in operational practices and develop capabilities that go beyond those of traditional enterprises and entrepreneurs. Compared to traditional entrepreneurs and enterprise leaders, social entrepreneurs adopt a wider variety of practices (Ávila et al., 2021; Sinthupundaja et al., 2020).

Masilamani et al. (2024) compares the logics of causation and effectuation. Causation is a rational decision-making logic where a set goal is defined, and various means are generated to achieve it. Environmental constraints are overcome to maximise returns. Effectuation is an emergent, non-predictive decision-making strategy based on available means and effects, with constraints from limited resources and environmental factors. Goals are selected based on affordable loss and characterised by four dimensions; experimentation, affordable loss, flexibility and pre-commitments. The paradigm of effectuation maps better on to the opportunity-centric phenomenon of social entrepreneurship than does causation. Masilamani et al. (2024) also found that operating under the effectuation paradigm is positively associated with co-creation (which is positively mediated by uncertainty). By engaging in effective co-creation, social entrepreneurs can enhance the availability and utilisation of resources, innovate their business and social impact model and ultimately achieve greater social impact.

A social entrepreneur’s personal network (their “owned” social capital) is also considered a resource when it is transformed into relationship strength (their “used” social capital) through the intermediary role of resource bricolage (Liu et al., 2020). According to Naranjo-Valencia et al. (2020), a leader’s social capital can be categorised into three types: bonding capital refers to the close relationships within a homogenous group, fostering trust and collaboration; bridging capital connects diverse groups, enabling access to new resources and ideas; while linking capital involves relationships with external institutions which can provide critical support and resource.

Being embedded in the beneficiary community allows social entrepreneurs to understand the unique needs and challenges faced by the community (Naranjo-Valencia et al., 2020). A key part of social entrepreneurship that emerged in the literature is their ability to connect and access otherwise slack resources (those resources in surplus or excess and potentially usable) by effectuating co-creation among diversity of partners. Social enterprises that prioritise community engagement and participatory practices are more likely to be successful in creating social impact (Ávila et al., 2021).

Analysis of this theme reveals a consistent focus on the importance of systematic and organised resource management under conditions of resource scarcity and uncertainty. This theme differs from Theme 2 in the sense that it addresses the social entrepreneur’s ability to cope and manage under conditions of resource scarcity and uncertainty, as opposed to the ability to use and source resources.

Many social entrepreneurs find themselves in a situation where they lack access to funding and financial resources due to their prioritisation of creating social value over profitability, making them less attractive to traditional investors who often prioritise financial return (Baker and Weerakoon, 2024). Nardini et al. (2022) emphasise that successful social entrepreneurship requires strong partnerships with stakeholders to effectively mobilise resources. Lack of access to financial resources can hinder social enterprises’ ability to scale (Lashitew et al., 2021). Kullak et al. (2021) discuss how social purpose organisations can enhance social value creation by integrating resources from various participants, thereby facilitating co-creation of social value. Bricolage is relevant here also, as social entrepreneurs often need to creatively combine available resources to develop innovative solutions (Shaheen et al., 2023). This approach often involves “making do” with what is at hand and can address the challenges posed by resource scarcity. In turn, this forces social entrepreneurs to be creative and novel in their utilisation of resources (Shaheen et al., 2023).

Adaptive tensions arise for many social entrepreneurs as they attempt to solve social issues while managing resource constraints. The interplay between these tensions can either hinder or stimulate innovation. Resource scarcity can limit options, or it can drive organisations to think creatively and develop innovative solutions (Shaheen et al., 2023). Kullak et al. (2021) points out that managing these tensions is not solely the responsibility of the founder or entrepreneur.

Diverse partners, including community members, government, non-government organisations, other social enterprises and private sector partners, can contribute to alleviating risk and conflicts by facilitating access and leverage to a broad range of resources – including financial, operational and knowledge.

Bundling under-used resources can turn uncaptured value into tangible benefits for local communities (Bals et al., 2023; Wagner and Kabalska, 2023; Masilamani et al., 2024). Shaheen et al. (2023) explain how humanitarian social enterprises can leverage collaborative capabilities to integrate these slack resources with external partners, thereby expanding their social impact. This enables social entrepreneurs to not only maximise the utility of previously available resources but also convert previously extant yet dormant resources into valuable contributions to social value creation, allowing a more flexible and adaptable response (Kullak et al., 2021).

Co-creation occurs through a collaborative process in which multiple stakeholders, including organisations, customers, beneficiary communities, governments, universities and other relevant groups, actively participate in the creation of value, products or services (Bonomi et al., 2020; Czinkota et al., 2020). In this context, stakeholder relationships and networks play a crucial role. This theme shows the importance of perceived authenticity during the co-creation process between social enterprises and stakeholders.

Maintaining authenticity during co-creation is a multifaceted challenge that requires a careful balance of credibility, organisational identity, effective governance and a clear mission-in-practice. The insights drawn from this theme collectively underscore the importance of fostering genuine, participative and reciprocal relationships among stakeholders. Theme 1 is further supported by establishing the importance of social enterprises maintaining alignment between their mission-in-practice and the expectations of stakeholder groups.

Described by Leite (2022, p. 334) as “searching, acting, and convincing actors of an opportunity […]”, this theme emphasises the importance of relationships in facilitating co-creation (Ramachandran et al., 2022; Misener et al., 2020; Ostertag et al., 2021). There are various ways in which co-creation occurs through cooperation. The ecosystem approach involves a network of interconnected organisations that collaborate to achieve common social goals, where each participant contributes unique resources and capabilities. Diverse interactions enable stakeholders to co-create value benefiting the community in which the ecosystem is located (Gustafsson et al., 2023).

Another approach is the use of a platform which provides a structured environment that facilitates interactions among multiple stakeholders, enabling collaboration through various forms, such as digital platforms or physical spaces that host collaborative activities; acting as intermediaries for communication, resource sharing and knowledge exchange (Ostertag et al., 2021). In some instances, a social enterprise can act as this intermediary connecting stakeholders and facilitating social value co-creation. The unique position of being embedded in the community facilitates collaboration, mobilises resources and coordinate efforts that co-create solutions to social issues (Álvarez-González et al., 2023).

However, the nature of the relationship is often more organic and emergent. In many instances a more reflexive self-organisation occurs, in which stakeholders autonomously form and manage collaborative relationships based on shared values and goals. These reflexive self-organised relationships lack formal structures, leading to more organic collaboration and co-created value through responsive adaptation (Quintelier et al., 2023).

The benefits of co-creation, in this context, extend beyond immediate outcomes. Alignment of motives among partners can enhance inter-partner involvement. For example, Spitz et al. (2021) discuss how motive alignment shapes the nature of nonprofit business partnerships, with low social impact motives leading to limited inter-partner involvement. On the other hand, high social impact motives result in deeper inter-partner collaboration. The alignment of objectives and quality of relationships between partners are vital for successful co-creation. If partners perceive the benefits of their collaboration as high, their intention to participate will also be higher (Spitz et al., 2021; Álvarez-González et al., 2023).

Learning from partners is a critical aspect of co-creation of innovations. Leite (2022) discusses innovation networks that collaborate and share information among various partners to identify societal problems and develop tailored, innovative solutions. This collaborative approach leads to more relevant and effective solutions, but also builds trust and strengthens relationships among participants which is important for sustaining active engagement and further knowledge sharing (Quintelier et al., 2023). The synergy created through knowledge sharing in co-creation enables partners to combine their resources and capabilities (discussed in Theme 3) in novel ways, leading to the development of new ideas and innovations that are more likely to meet the needs of the beneficiary community (Martins et al., 2023). This theme emphasises that successful co-creation requires quality relationships, active learning and a mutual understanding of the benefits.

Authenticity, in the context of this discussion is closely tied to the genuine commitment to social missions and transparent communication (Lückenbach et al., 2022; Czinkota et al., 2020). Whereas legitimacy is framed as the perception of appropriateness and desirability of an organisation’s actions within its social context (Naimi et al., 2022; Bonomi et al., 2020). Legitimacy is crucial for ensuring that co-creation efforts are perceived as authentic (Czinkota et al., 2020).

Social enterprises must be perceived as authentic and cultivate credibility through genuine engagement with stakeholders, which is essential for building trust and sustaining their operations. In the context of Italian for-benefit companies, Czinkota et al. (2020) illustrates that when these companies adhere to the contextual rules and values of their community they enhance their legitimacy and support the social acceptance of the organisation. In the case of virtual CSR co-creation, Jun et al. (2020) discuss the importance of being perceived as credible and authentic by the customers with whom the organisation was participating in co-creation of social value.

Many social enterprises navigate conflicting institutional demands because of intra-organisational collisions and identity crises. Addressing conflicting beliefs within the organisation, and among stakeholder groups, fosters a unified organisational identity that embraces the hybrid nature of the mission. The interplay between organisational identity and organisational logic (the dynamic system of roles, rules and social expectations that arise from an organisation’s business and impact model) is crucial for maintaining perceived authenticity during co-creation (Bonomi et al., 2020). But opposing logics including market vs social logic, public sector expectations, and internal alignment challenges create tensions between profit generation and social mission fulfilment. This jeopardises organisational coherence and effectiveness. Bonomi et al. (2020) also discuss the concept of de-legitimising organisational logics when different stakeholder groups adhere to opposing logics leading to illegitimacy and inauthenticity of co-creation efforts.

Balance is crucial for ensuring that all stakeholders feel valued and engaged in the co-creation process. Inclusive governance facilitates authentic co-creation by balancing financial interests with the social mission of the organisation (Czinkota et al., 2020). Governance structures should extend beyond traditional frameworks to include network-level institutional work that fosters collaboration, transparency, resilience and accountability among diverse stakeholder groups (Bonomi et al., 2020). Participatory governance models create brands that have authentic, stable identities, while managing stakeholder groups’ various expectations (Lückenbach et al., 2022). Similarly, Vickers et al. (2024) discussed organisational democracy as a governance modality, promoting dialogue, trust and guidance of social missions.

The entrepreneur plays a pivotal role in maintaining organisational logic and authenticity by imbuing and embodying the core values in and of the organisation (Lückenbach et al., 2022). A role that is often overlooked in the social entrepreneurship/enterprise discourse is fundraising. According to Naimi et al. (2022), in the context of prosocial crowdfunding, the role of the leader is often to convey information about their business, including authenticity and legitimacy, in contexts often characterised by high information asymmetry. Entrepreneurial narratives that involve cognitive and positive emotional appeals effectively encourage partners to participate in prosocial value creation. By actively engaging with stakeholder groups and demonstrating an authentic interest in addressing social issues, the entrepreneur can ensure that the organisational logic remains balanced and aligned with the overarching mission, enhancing the credibility and effectiveness the co-creation initiative (Lückenbach et al., 2022).

Many social enterprises operate as small-scale entities within specific geographical and social contexts, enabling entrepreneurs to deeply understand local needs of the communities in which they are embedded. This theme underscores the critical role of local context in the functioning of social enterprises.

Through collaborative efforts and resource orchestration, social enterprises can effectively contribute to the social and economic fabric of their localities, creating a positive impact that resonates throughout the community. Kilpatrick et al. (2021) illustrates how social enterprises in regional communities can actively involve community members in their operations, leveraging local networks and resources to co-create products and services that are tailored to the unique characteristics of that community. Operational inclusion fosters a sense of ownership among the beneficiaries.

Embeddedness not only enables social enterprises to understand and respond to the specific needs of their communities but also facilitates the delivery of social value that enhances the overall well-being of the regional population. Taylor et al. (2020) found that nonprofit social innovation requires attention to geographic and diversity characteristics if social enterprises are to respond to the needs of the local community in which they are delivering their service. Bals et al. (2023) highlights that small social enterprises, through their engagement with social intermediaries, bundle resources and capabilities that directly address the needs of the local community. Moreno et al. (2020) revealed that enterprises in developing countries can harness the benefits of being first movers in service provision, allowing them to respond effectively to community needs. Taylor et al. (2020) built on this by illustrating that successful social enterprises actively involve community members in their operations, enhancing a sense of ownership among beneficiaries.

This section presents the key implications for future research identified through the corpus analysis. It discusses implications through the MAO lens. The MAO framework offers a holistic lens for examining social entrepreneurship by simultaneously considering the entrepreneur’s motivation, ability and opportunity. It explains not only what social entrepreneurs do and what they pursue, but critically, why they persist in their pursuit of social impact despite challenges and how they sense opportunities and reconfigure resources to remain responsive to dynamic conditions. This integrated approach distinguishes it from other, more focused and reductionist theoretical frameworks commonly applied to social entrepreneurship research. The future research directions identified in this review emerged precisely because the MAO lens revealed gaps in understanding these interconnections, particularly around sustaining motivation over time, developing capabilities for authentic co-creation and balancing place-based opportunities with scalability imperatives.

Figure 5 visually overlays these research opportunities onto the thematic network analysis presented in Figure 4. Table 3 explains how each research opportunity is represented through the MAO lens, and what further research might broadly address.

A motivational gap in the current literature concerns the longitudinal understanding of social entrepreneurs’ motivations and experiences. While existing research provides cross-sectional understanding of entrepreneurial activities and organisational structures, there is limited insight into how social entrepreneurs sustain their commitment over time, particularly in the face of challenges and adversity.

Another promising opportunity is exploring the interplay between prosocial and self-interest motivations among social entrepreneurs. While considerable attention has been paid to organisational processes and outcomes, less is known about the personal journey of social entrepreneurs. Current literature emphasises the prosocial and altruistic motivations of social entrepreneurship while mostly overlooking the personal benefits and rewards that entrepreneurs derive from their work. Understanding this dynamic could provide valuable insights into the sustainability of social entrepreneurship and the aspects that contribute to the entrepreneurs’ satisfaction and persistence.

There exists a gap in the current literature regarding the nature of co-creation in social entrepreneurship. While extensive research examines how social entrepreneurs collaborate with various stakeholders to leverage resources and capabilities, there is limited discussion about genuine co-creation of social value with beneficiaries, which from an MAO perspective leans into opportunities. The corpus primarily focuses on how entrepreneurs mobilise and coordinate with other actors in their ecosystem, rather than exploring the deep engagement and collaborative processes with the intended beneficiaries of their social initiatives.

Future research could investigate how social entrepreneurs actively engage with and incorporate beneficiaries in the co-creation process. The resource-based view and resource dependency theory highlight the need to rely on external actors to access resources outside the social enterprise’s boundary. Future research could explore how co-creation dynamics relate to these two theories, which may operate together. Secondly, studies could examine the mechanisms and practices used to facilitate knowledge exchange between social entrepreneurs and beneficiaries, how beneficiary perspectives are integrated into solution development, and how this engagement is managed over time. Understanding these dynamics would provide valuable insights into authentic co-creation of social impact, moving beyond the current focus on resource integration to explore how beneficiaries actively participate in shaping and delivering social impact.

Understanding whether a resource-based view (RBV) or dynamic capabilities (DC) approach better explains the personal abilities needed for successful social entrepreneurship. While the literature acknowledges that social entrepreneurs need competencies like social innovation, proactiveness, and risk management from an RBV perspective and capabilities to sense opportunities and reconfigure resources from a DC view, there is no clear consensus on which theoretical lens is more appropriate. From the MAO perspective, this avenue of research addresses the entrepreneur’s ability to succeed.

This ambiguity becomes particularly relevant when considering that social entrepreneurs must actively co-create value with stakeholders. While literature highlights the importance of collaborative relationships and resource integration, questions remain about which theoretical framework better captures the entrepreneurial capabilities needed for successful social value co-creation. This gap is particularly noteworthy given that effectuation approaches, which align more closely with dynamic capabilities’ emphasis on adaptability and opportunity recognition, may be more effective in the context of social entrepreneurship.

While research shows that social enterprises can effectively create value through deep local embeddedness, the question of how to maintain this local connection while scaling operations remains largely unexplored in the literature. This tension becomes particularly important as social enterprises attempt to expand their impact beyond their original beneficiary communities, potentially losing the intimate understanding of local needs and the ability to foster meaningful community engagement that made them successful initially. From an MAO perspective, understanding this promises to enhance understanding of opportunity.

Future research could examine how social enterprises navigate this paradox, particularly investigating the potential mission drift and trade-offs between maintaining authentic local connections and achieving broader social impact through scale. This research could provide valuable insights for social entrepreneurs seeking to balance the benefits of local embeddedness with the imperative to expand their social impact.

This analysis highlights the imperative for social enterprises to prioritise a hybrid mission, allowing social goals to drive decision-making to prevent mission drift and to create genuinely participatory processes that give beneficiaries and other stakeholders a voice in design and delivery. Authentic co-creation builds trust, legitimacy and improves solutions through beneficiary involvement and iterative feedback. Further, there are advantages to leveraging local, place-based resources through bricolage.

Leaders of social enterprises should continuously develop both their own and their teams’ capabilities through structured training, networks, and mentorship programs to enhance their ability to seize social entrepreneurial opportunities. Higher education institutions play a crucial role in equipping current and future social entrepreneurs with necessary skills by integrating social enterprise curricula that teaches how social enterprises balance and selectively couple competing institutional logics.

The research gap around balancing local impact with scalability highlights a fundamental societal challenge; balancing scaling for social impact (standardisation) with ensuring contextual applicability at the local beneficiary community level (customisation). With appropriate support, government can use the social enterprise paradigm to enable more social impact creation at a localised level, rather than relying on one-size-fits-all government initiatives. Funders and policymakers should create environments that enable social enterprises in pursuing hybrid goals of being commercially viable and creating social value – funding and financial innovation would help. Government-backed loans and co-investment schemes can offset traditional market failures. There are lessons to be learnt from social enterprises such as Italy’s Società Benefit, UK’s Community Interest Company and Benefit Corporations adopted by multiple states in the USA.

Enormous energy is being expended globally in transforming our work and its impacts on society and the environment. A significant part of this effort is expended by social entrepreneurs. It is right they be given the best opportunities to be successful in their pursuit of positive social and environmental impact. Social enterprises serve as crucial connectors and social capital builders, reducing systemic social inequalities through deep local embeddedness. However, this is limited as there are tensions in scaling impact. The public perception of social enterprises as merely “businesses doing good” has been challenged and instead positions them as complex organisations which require appropriate policy support.

In the spirit of the MAO model and its particular focus on the influence of human behaviours in social entrepreneurship, this review has revealed that a more nuanced, and human-centred examination of the lived experiences of social entrepreneurs is warranted. More needs to be understood about what motivates and sustains the entrepreneurial life, as well as the competencies and capabilities required for success. Further exploration is also needed into how tensions between place-based benefits and scalability can be balanced, how co-creation with beneficiaries manifests, and the opportunities enabled when links between the two persist. The intent of this study and its positioning of future research is to understand social entrepreneurs more deeply, and in ways that bolster the success of their pursuits.