Organizing for transformative innovation policies: The role of social enterprises. Theoretical insights and evidence from Italy

Transformative innovation policies can provide systemic solutions to socio-environmental challenges because of their “experimental”, “reflexive” and “inclusive” character. We contend that social enterprises can act as catalysts for transformative innovation for the geographically and socially marginalized. Thus, including social enterprises in transformative innovation policies can mitigate the negative effects of innovation-based growth, making policies more socially and geographically inclusive. Following a syncretic approach to the literatures on transformative innovation policies and social entrepreneurship, this paper identifies the key dimensions of social enterprises' transformative innovation potential: directionality (i.e., social goals as the purpose of innovation); social and geographical inclusiveness (i.e., the inclusion of marginalized areas and individuals in the provision of goods or services); reflexivity (in terms of participatory governance and monitoring the achievement of goals); and experimental character (in terms of establishing partnerships with heterogeneous actors). We then assess this capacity through an exploratory cluster analysis of Italian social enterprises. We identify three distinct groups that suggest a range of entrepreneurial approaches from largely transformative to not at all. The transformative innovation readiness of social enterprises has implications for policymakers seeking to undertake pilot schemes and implement actions that support an appropriately transformative innovation ecosystem.