Social Capital and Social Entrepreneurship : Analysing Links and Implications for Sustainability in Third Sector Organisations in West Bengal

Abstract

The theory of social capital attracts considerable attention across diversified fields due to its positive impact on society. A major portion of social capital literature is devoted to defining the concept and identifying the sources and factors that contribute to social capital development. Putnam (1993), the major proponent of this theory, defined social capital as the trust, norms and networks that facilitate coordinated action and improve the efficiency of society. He considered voluntary organisations to be a significant source of social capital as they encourage the trust-based relationships required for collective action. Many authors argued that social capital development is context specific. Krishna (2002) found that in a poor socio-economic context, social entrepreneurs acting as mediators can activate social capital and bring development. Social entrepreneurs act as catalysts to social change (Alvord et al. 2004), but limited studies have focused on their role in voluntary organisations in developing social capital.

The present research analyses the activities of social entrepreneurs who assist in building and strengthening social capital among villagers as a part of the development process, and the implications of these activities for organisational sustainability. The activities of two types of social entrepreneurs, outsiders (SEETOs) and insiders (nonSEETOs) have been analysed.

The research used a qualitative design and case study approach to investigate multiple levels of analysis within the single study. The case study organisations are five rural voluntary organisations from the state of West Bengal, India — three with SEETOs and two with non-SEETOs. Primary data have been collected during 2007 and 2008 through face-to-face interviews, published materials, photographs and participant observations.

The findings of this research indicate that the development of social capital is dependent on the ‘enabling’ leadership style of social entrepreneurs. The ‘enabling’ leaders played an important role in transforming an organisation into a learning organisation and developed the villagers’ organisational ability or social agency (an element of social capital) as a group to solve their own problems. The learning organisation ensures organisational sustainability. The study also observed the ‘benevolent dictator’ leadership style. The ‘benevolent dictator’ failed to create a learning organisation, and so the villagers had no organizational ability or social agency, which then placed organisational sustainability at risk. However, both types of leader played positive and effective roles in improving the lives of poor villagers. The research confirmed the social entrepreneur’s role in social capital development in voluntary organisations within a poor socio-economic context.