Japan Forum of Business and Society Annals, No.5, pp. 1-18, 2016

1

Introduction――Entrepreneurship and Sustainable Innovation

Nobuyoshi Ohmuro
Professor, Kyoto Sangyo University, Japan

Hiroshi Amemiya
Representative, Corporate Citizenship Japan, Japan【Abstract】
The JFBS 5th Annual Conference was held in September 2015, and was hosted by the Japan Forumof Business and Society (JFBS). The conference provided a platform for the discussion of various
dimensions of the sustainability-strategy relationship.
Modern society is experiencing numerous and varied social problems. The marketplace and thecorporation are central to these emerging social issues. To tackle these issues, fundamental socioeconomic changes need to be made now. These changes would include rules governing the market
and management style in the corporate world. We consider entrepreneurship to be fundamental tonecessary social change, and accordingly will endeavor to focus our discussions on entrepreneurshipand sustainable innovation in this conference.
This introduction is organized into the five following sections:
1) Purpose and Background2) Current Research: Trends and Subjects3) Overview of Contributions4) Conference Outline
5) About JFBS

1-1. Purpose

1.

Purpose and Background

Sustainable / Social Innovation refers to business models addressing the resolution of so-

Firstly, we want to clarify the purpose of thecial and environmental issues through theconference and explain its background or

creation of new social values. To stimulate in-premises. We will also explain the terms usednovation, social businesses, large companies,

in the conference and ensure current terms

NGOs, local people, and governments can pro-are understood in the context of research

mote cooperation between researchers, there-

trends.

by creating an institutional environment that

2

Introduction

promotes new business patterns.

around the concept of “creating shared value”,

In the conference, various issues and chal-commonly referred to as CSV (Porter, et al.,lenges related to “entrepreneurship and sus-

2011). CSV is explained as the practice of cre-tainable innovation” were discussed. It is ourating economic value in a way that also cre-hope that the discussions will contribute toates value for society by addressing its needs

the resolution of some of these problems.

and challenges. There are three ways to create shared value:

1-2. Social Background
Currently, society is dealing with a range ofincreasingly serious issues (the environment,
the gap between rich and poor, and other, often
related issues) . Efforts were made to begin

tackling these issues at the United Nations

・through the reconception of products
and markets
・through the redefinition of productivity
in the value chain・through the enabling of local cluster
development

Conference on Environment and Development

Shared value is seen as something distinct(UNCED) in 1992. These efforts can be traced

from corporate social responsibility or philan-back to 1987 when the United Nations World

thropy. It is regarded as being integral to theCommission on Environment and Develop-

core of business strategy. However the con-ment released a report entitled “Our Common

cept has been criticized by various groups,

Future”, commonly called the Brundtland Re-

such as summarized in Figure 1 (Crane, et al.,port. Since then, discussions have been con-2014) . This criticism essentially revolves

ducted and policies implemented around thearound skepticism regarding its ability to tru-

world. The following section aims to give an

ly integrate economics and social goals. Addi-

overview of the efforts of governments, corpo-

tionally, the concept discusses corporate com-rations and NPOs.

petitive strategy and social issues largely

Firstly, we started with a discussion of cor-from the point of view of a shareholder-orient-porations. Since the 1990s, for the reasons

ed company. It is based on understanding ac-

mentioned above, many corporations have en-

cumulated throughout the career of Professor

gaged with the pursuit of corporate social re-Porter, a highly influential researcher in com-sponsibility, commonly called CSR, and “social

petitive strategy, and is ultimately no morebusiness”, which aims to tackle social prob-

than a posited theory.

lems. Much of this activity is external to con-

The theory is contingent upon corporations

ventional management activity. However, theintegrating a social point of view into their

original meaning of CSR has been asked to

management core, but thus far integration ofchange core management of the corporation.

economics and social goals has not been

In many corporations there has been a lack ofachievable.

decisive input regarding CSR, but recently an

Meanwhile, since the late 1980’s, certain

interesting theory has emerged. It revolves

unique corporations have gained traction em-

Introduction

Table 1

3

The Strengths and Weaknesses of the Creating Shared Value Concept

Strength

Weaknesses

CSV Successfully appeals to practitioners and scholars

CSV is unoriginal

CSV elevates social goals to a strategic level

CSV ignores the tensions between social andeconomic goals

CSV articulates a clear role for govemments in
responsible behavior

CSV is naive about the challenges of businesscompliance

CSV adds rigor to ideas of “conscious capitalism” andprovides an umbrella construct for loosely connectedconcepts

CSV is based on a shallow conception of thecorporation’s role in society

Source: Crane, et al. (2014), p.132.

bracing a management style whereby multi-

We shall take only a brief look at NPOs andstakeholders’ concerns are central to the core

governmental bodies as they are not centralof the corporate management level. Theseto the ambit of this conference. Increasingly,

companies include Patagonia, Inc. (U.S.A.),

NPOs have engaged in enterprise and govern-

Whole Foods Market, Inc. (U.S.A.), The Body

ment bodies have attempted to make use of

Shop International plc. (U.K.) and IKEUCHI

markets to compensate for funding shortages

ORGANIC, Inc. (Japan) . They have been

since the late 1980’s. This had led to thetermed “responsible company: management

emergence of social enterprises (including non-style assuming the economic activities giving

profit groups and social ventures) which use

a negative impact for environment (Chouinard,business as a means of tackling social issues,

et al., 2012)”, “conscious corporations: manage-

particularly from the late 1990’s onwards. But

ment style of multi-stakeholder friendly

the growth in both magnitude and complexity(Mackey, et al., 2013)” or “social ventures (a firmof social issues has only increased. There areestablished by a social entrepreneur that seeks to

two reasons for this. Firstly, these enterprises

provide systemic solutions to achieve a sustain-

made use of, without making any reforms to,able, social objective)”.

There are also what

the very markets which tend to be the princi-

have been called “sustainable enterprises”,

ple factor in the creation of these social prob-

which are defined as contributing to sustain-

lems. Secondly, the mutual supplement ofable development by simultaneously deliver-

government, the markets, and the NPOs did

ing economic, social, and environmental bene-

not function in way that would allow these is-fits - the so-called “triple bottom line” (Hart, etsues to be tackled effectively. Essentially,al., 2003). It can thus be seen that a variety ofthese bodies end up being assigned roles

concepts have arisen, and CSR can be said towhereby the government needs to supple-

have deepened. But the management style ofment the failure of the market, the market

these enterprises cannot be said to haveneeds to supplement the failure of the govern-

gained a foothold in mainstream corporations.

ment, and the NPOs need to supplement both.

4

Introduction

This relationship is illustrated in Figure 1.

porate level.

Meanwhile, the concept of social enterprise or

Meanwhile, approaches to innovation havesocial business, which has been flaunted as ashifted from a “closed innovation” approach tomeans of taking on social issues, has not been

an “open innovation” approach (Chesbrough,allowed to function because it has not pene-2003). This involves the mobilization of hetero-

trated mainstream corporations. It cannot

geneous resources such as techniques andhave any impact of the rules of the game (foridea, thought processes and so on. If a corpo-

example on corporate management style) andration focuses on money alone, it will not be

the social problems they produce. We need tocapable of harnessing these heterogeneous re-think the tools or systems of solving social

sources. To fully harness these resources, aproblems from viewpoints that do not create

corporation really should take other factors

more social problems.

into consideration, such as their contribution

To do this, fundamental changes will beto society.

necessary. The key to these changes is

So it can be seen that for these two reasons

thought to lie within the marketplace itself,

corporations need to strengthen their relation-

given that the marketplace has been the main

ships with society. Accordingly, companies

creator of these social issues. For example, en-need to embrace an entrepreneurship of a

vironmental issues and increasing wealth dis-

new type, as conventional companies simply

parity can be seen as results of the relentless

will not be able to alter the nature of their re-quest for maximum efficiency by corporate

lationship with society.

management. This is what has necessitated

The next session looked at the relationships

attempts at mitigation by introducing the con-

between business and society from the stand-cept of CSR into the globalized economy.

point of entrepreneurship and innovation

Present day social conditions are crying out

based on sustainable development.

for change in management styles at the corFigure 1

The Failure of Mutual Supplement
Government2.

Current Research: Trends andSubjects

Here is an explanation of the concepts andfailuretopics, such as sustainable development, entrepreneurship and innovation, as used in theconference.
2-1. What is Meant by Sustainable Develop-

NPOs

MarketfailurefailureThe failure of Mutual
Supplements

ment
Sustainable development has been defined as“development that meets the needs of thepresent without compromising the ability ofIntroduction

5

future generations to meet their own needs. It

agement styles have emerged that do embody

contains within it two key concepts: the con-this type of integration, such as Patagonia or

cept of needs, in particular the essential needs

Whole Foods (U.S.A.). The mission statementsof the world’s poor, to which overriding prior-

are indicative of the management style inity should be given; and the idea of limita-these cases. The style is entrepreneurial intions imposed by the state of technology andspirit and centers around stakeholder-orientedsocial organization on the environment’s abili-innovation. Further, conventional forms of en-ty to meet present and future needs” (United

vironmental management “usually do not

Nations, 1987).

question a company’s core business activity,

Sustainability is essentially about:products and services of the company, but“How individuals should act towards na-

are rather oriented toward a cost-efficient ofture and how they are responsible for thenegative environmental impacts (Schaltegger,other and the future. The vision of sus-

et al., 2008)”. Accordingly, we would like to ex-tainability aims at ‘justice’ in the domain

plore entrepreneurship and innovation from aof individual-nature-relationships and in

multi-stakeholder point of view.

view of the long-term and uncertain future including three specific relationships

2-2. Entrepreneurship and Innovationsuch as justice between individuals of dif-

(1) Entrepreneurshipferent generations, justice between differ-

Here we would like to discuss what we mean

ent individuals of the present generation

by entrepreneurship and some of the various

and justice between individuals and na-

forms of it which have developed over time.

ture”(Baumgartner and Quaas, 2009).

There are, for example, varieties of it such as

The key point here is the mutually benefi-

environmentally-orientated entrepreneurship,cial relationship between organizations andsocial entrepreneurship, institutional entrepre-

multi-stakeholders as seen from the corpora-neurship, intrapreneurship and sustainabletion’s point of view. Currently, all corporations

entrepreneurship. Numerous visions haveare obliged to take multi-stakeholders into

been articulated about the role of the entre-

consideration in their management practices.

preneur in a capitalist economy. There has

But most of them have been restrained in thisbeen wide-ranging debate about the relation-

consideration and have not changed the fun-ship between entrepreneurship and sustain-

damental essence of their practices. By thisable society. For more than 200 years the con-

we mean that currently, any contribution to

cept has been explored and this has led tosociety made by companies tends to be exter-

many and varied definitions of the word “en-nal or additional to the maximization of profit.

trepreneur”. However, no theory of entrepre-

What needs to take place is an integration ofneurship has emerged that would explain or

the multi-stakeholders into the actual businesspredict under what circumstances an entre-

process. In some cases, since the 1990’s, man-preneur, no matter which definition is applied,6

Introduction

might appear or engage in entrepreneurship.

sentially focused on environmentally-oriented

Discussion of the topic really started withentrepreneurship, often called “ecopreneur-

Jean-Baptiste Say, a French economist, inship” (Blue, 1990, and others). The core motiva-

around 1800. In his opinion, “the entrepreneur

tion and chief goals cited in association withshifts economic resources out of an area of

ecopreneurship revolve around the earning oflower and into an area of higher productivity

money through contributing to solutions toand greater yield”. “Perhaps the best known

environmental problems (Table 2). Economic

is Joseph Schumpeter’s view of the entrepre-

goals are seen as the end to which the busi-

neur in the Theory of Economic Development

ness is aiming, while environmental goals as(1934). Schumpeter’s entrepreneur is an agent

seen as an integrated part of the economicof change that is the source of his famous cre-logic of the business. “The organizational chal-

ative destruction. Popular theories of entre-

lenge of entrepreneurship is to better inte-preneurship feature the role of risk taking,grate environmental performance into the

managerial ability, wealth, and preferences for

economic business logic or to multiply thethe control, flexibility and other job attributes

number of (small) green businesses. In addi-

that come with being one’s own boss as thetion most authors agree that ecopreneurshipprimary motivations for entrepreneurship”

is about the implementation of innovations”(Ohyama, et al., 2009).

(Schaltegger and Wagner, 2011). Ecopreneurship

Since then, entrepreneurship has been

is discussed as being about environmental

looked at from diverse points of view, andand social issues but also about innovation.

Schumpeter’s concept has not necessarily

The concept centers on the integration of eco-

been universally accepted. Entrepreneurship

nomic logic and environmental goals, but does

has also come to be examined from a CSR

not take into enough account other stakehold-perspective. It has been noted over the lasters or the institutional change needed to solve

two decades that the traditional concepts andsocial issues. In the next session, we discuss

practices of corporate philanthropy have un-concepts of social entrepreneurship which aredergone a significant evolution into Corporate

wider in scope than ecopreneurship.

Social Responsibility under a variety of labels,

It has been noted that concepts of social en-

such as corporate citizenship, triple bottom

trepreneurship are emerging from the arenaline, and strategic philanthropy (Austin, et al.,of Non-Profit Organizations (NPOs) (Waddock,2009). In recent years, it has increasingly been

et al., 1991). The primary reasons for this are

discussed in terms of its relationship with so-

related to the need for entrepreneurship incial issues, as shown in Table 2. In the follow-

these organizations simply in order to survive

ing section, we look at this in more detail.

in the face of loss of funding due to grants be-

Let us take an overview of the relationshiping cut by governments and private founda-

between sustainability and entrepreneurship.

tions. This has led them to be counted among

Thus far, studies of this relationship have es-socially-oriented corporations or social ven-

Introduction

7

tures. The literature on social entrepreneur-tings creates links to institutional entrepre-

ship deals with efforts to achieve societal

neurship (Table 2). Actors who initiate changes

goals and secure funding for these efforts.

that contribute to transforming existing insti-

However, a closer look reveals three obvi-

tutions or to creating new institutions areous distinctions between the concepts of social

termed institutional entrepreneurs (DiMaggio,

entrepreneurship and ecopreneurship. Firstly,1988), and their effort to change institutions“used in a very broad sense of ‘concerning so-

despite pressures towards stasis is discussed

ciety’ the term ‘social’ includes environmental

as institutional entrepreneurship (Ostrom,issues. Thus, in some approaches social entre-1990). Work on institutions has traditionally fo-

preneurship encompasses ecopreneurship as a

cused on continuity although it increasingly

subcategory” (Dees, 1998a, p.56). Secondly, “inacknowledges the importance of change. In

contrast to the ecopreneurship approaches -contrast, the work on entrepreneurship hasthat mainly address business organizations

focused on change even as it acknowledges

with environmental objectives - most of thethat change is difficult to accomplish. More-social entrepreneurship approaches address aover, within institutional theory, this broader

different group of actors: non-profit organiza-

structure-agency debate is often referred totions” (Gerlach, 2003). The point here is a con-as the paradox of embedded agency. The the-trast between having goals which are primar-

oretical puzzle is as follows: if actors are em-

ily ecomomic as opposed to having goals

bedded in an institutional field and subject towhich are primarily societal. The third point

regulative, normative and cognitive processes

is the relationship between the institutions.

that structure their cognitions, define their in-

Referring back to the previous session, theterests and produce their identities, how aregoals of ecopreneurship don’t include making

they able to envision new practices and thenchanges to institutions, but the concept ofsubsequently get others to adopt them? (Ga-making changes to institutions does factor torud, et al., 2007). There has continued to be asome extent in social entrepreneurship. The

large volume of varied discussion on this top-

reason for this is that if social problems are to

ic.

be seriously tackled at their core, institutional

Weik (2011) suggests it is important to bearreform or change is going to be necessary -in mind critiques of the individualist-manage-

particularly in terms of market conditions,rialist bias, which draw attention to the entre-

management style, and even attitudes amongpreneur as an individual and the difficulties

the population and what is thought of as “theinvolved in an entrepreneur promulgatingnorm” for the average citizen. In this sense,

new ideas in an institutional environment. He

institutional change takes on real significance,then presented notions of collective or dis-so we would like some attention to be drawn

persed agency as solutions. This view intro-

to institutional entrepreneurship.

duces the possibilities inherent in the con-

The ambition to change institutional set-

cepts of the intrapreneur and the multi-

8Introduction

Table 2

Characterization of Different Kinds of Sustainability Oriented Entrepreneurship
EcopreneurshipCore motivation

Social entrepreneur-

institutional entrepre-

Sustainable entrepre-

shipneorshipneurshipContribute tosolving

Contribute to solving Contribute to chang-environmental prob-social problem and ing regulatory, social
create value for soci- and market instiyu-

lem and create economic value
ety

tions

Earn money by solv- A c h i v e S o c i a l g o a lMain Goaling environmental prob­

and secure funding tolems

achieve thisRole of economic goals

Ends

Means

Role of non-market goals

Environmental issues
as integrated cor ele- Societal goals as ends
ment

Contribute to solvimg
social and environ­mental problems thro­ugh the realization ofa successful buisiness
Creating Sustainablechanging instiutions
as direct goal

development troughentrepreneurial corporate activities

Means of ends

Means and ends

Core element of inteChanging institutions grated end to contribas core element
ute to sustainable development

Form small contribuFrom focus on enviFrom focus on social Form changing instiOrganisational develop- ronmental issues totion to large contribuissues to integrateing tutions to integrateing
integrateing economic
ment challengetion to sustainable deecconomic issues
sustainability
issuesvelopment
Source: Schaltegger and Wagner (2011), p.229.

stakeholder.

by Pinchot in 1978. Pinchot (1984) defined in-

In this sense, the “entrepreneur team”, istrapreneurs as “those who take hands-on re-defined in terms of two or more people who

sponsibility for creating innovations of any

establish and share ownership of the new or-kind, within a business.” Later, Koch (2014)

ganization and who possess heterogenous

went further, casting intrapreneurs as the

skills or orientations (Tanimoto, et al., 2013). It“secret weapon” of the business world. The

would appear that entrepreneur teams willreason for this assertion is the notion that thehave a role to play in the future, and this has

capital which propels new ideas comes morethus far scarcely been discussed in the arena

easily from within a company. The main pointof sustainable innovation. Theories of institu-

is that risk and liability are generally lower

tional entrepreneurship have lagged behindthan innovation external to a company. There

the actual processes of institutional change.

are several background reasons for innovation

Next we would like to look at the concept ofbeing less difficult to implement in an existing

intrapreneurship, and particularly how theorganization. But there are also several disad-

problems involved compare with those of in-vantages, as shown in Table 3.

stitutional entrepreneurship.

The major disadvantage is that the ways in

Currently intrapreneurship is attracting at-

which an intrapreneur can change the struc-tention due to the innovation associated withture of a company are essentially limited init. The term “intrapreneurship” was first used

the same way as for an institutional entrepre-

Introduction

Table 3

9

Entrepreneurship and Intrapreneurship: Advantages and Disadvantages
ENTREPRENEURSHIP
Advantages

Disadvantages

・You are your own boss - independency

・Money pressure - giving up on the security of a regu-

・The income increases
・You have the chance to be original

・Less benefits as the business is newlar paycheck・You have part of excitement and adventure
・There are a lot of possibilities

・Long working hours
・Mistakes are magnified

・Salary potential - you decide upon your own salary・All decisions must be made alone

INTRAPRENEURSHIP
Advantages

Disadvantages

・Ability to stay in a friendly, well known environment
・Practicing your skills within an organization-lower
risk
・Using companies resources, good name, knowledge
・Access to customers, infrastructure

・Reward may not be up to expectation
・Innovation may not be appreciated accordingly・You can be innovative but to a certain limit - you are
not your own boss

Source: Maier, et al. (2011), p.973.

neur. As shown in Table 3, the intrapreneurtures and consumption patterns, and replaceis beholden to corporate decision-making. Inthem with superior environmental and social

practical terms, the criteria for decision-mak-products and services” (Schaltegger and Wag-ing in corporations will prioritize efficiency

ner, 2011). In this way, sustainable entrepre-

and profit-generation based on shareholder

neurship can be seen as having two faces: oneoriented. The cost-efficiency and profit-poten-

being “micro” (products) and the other “macro”

tial of innovation is by default harder to as-(market structure and broader concepts of that

sess, so the process does not favor it. So ulti-ilk). Consequently, sustainable entrepreneur-

mately it is up to the highest-level decision

ship can be said to cover wider ground thanmaker or decision-making body in the compa-

other concepts of entrepreneurship, as shown

ny. Institutional relationships assume a greatin Figure 2. In short, what is unique about it

importance here. For sustainable development

is that sustainable entrepreneurship is tied di-

to work, changes need to occur at an intu-

rectly to sustainable or social innovation, to aitional level and the role of the entrepreneur

greater extent than social entrepreneurship,in this needs to be recognized. Therefore we

ecopreneurship or institutional entrepreneur-would like to take a concluding look at sus-

ship. Schaltegger and Wagner (2011) pointed

tainable entrepreneurship.

out that “sustainable entrepreneurship is

Sustainable entrepreneurship generates

characterized by some fundamental aspects of“new products, services, techniques and orga-

entrepreneurial activities which are less ori-nizational modes which substantially reduce

ented towards management systems or tech-environmental impacts and increase the quali-

nical procedures, and focus more on the per-ty of life. They destroy existing conventional

sonal initiative and skills of the en­­tre­­preneur-

production methods, products, market struc-

ial person or team to realize large-scale

10

Figure 2

Introduction

Perspectives and Development of Sustainable Entrepreneurship and Sustainability Innovation
SocialgroupsNiche

Eﬀect of company on …
Massmarket

Market & Society

Sustainable
Traditional
Institutional
Entresocial entreEntrepreneurship preneurshippreneurship Sustainability
innovation in a
Ecopreneurship
Niche（Bioneers）

Management of environmental and social
challenges and opportunities

Administration ofsocial and environmental
requirements

Sustainability
performance
as a corebusiness goal

Sustainability
goals supplementary tocore businessHigh

Priority ofenvironmental
and social
issues as
businessgoals

Environmental
and social
Low
issues as atrustee duty

Source: Schaltegger and Wagner (2011), p.233.

market success and societal change with envi-

multi-stakeholders’ point of view, though anronmental or social innovations.” He went onunderstanding of this is crucial. The develop-

to say that sustainable entrepreneurs havement of theory which encompasses the multi-

strong influences on a company through theirstakeholders’ position fully is an ongoing chal-own personal goals and preferences in ways

lenge. Next, we will confirm the innovation

which are reflected in the goals of the compa-

from some viewpoints.

ny. A notable feature is the integration of eco-(2) Innovation

nomics with environmental and social con-

Debate about innovation is lively and ongoing.

cerns, meaning that, in common with businessStudies in the area essentially started withgenerally, the creation of new markets andSchumpeter (1942). He defined five types of in-

new demand is desired. This means sustain-

novation: product, process, business model,

able entrepreneurship can be thought of as

source of supply, and mergers and divest-

more influential in approaching bigger mar-ments. Currently, the shift from closed inno-

kets than the other types of entrepreneurship

vation to open innovation has significance formentioned (Figure 2).

both the consumer and the supplier (Ches-

We have considered several types of entre-

brough, 2003). This point corresponds to entre-

preneurship and how they relate to sustain-

preneurship studies mentioned in the previ-able development. It has emerged that theory

ous section. Open innovation is the use ofhas been able to satisfactorily explain either

purposive inflows and outflows of knowledge

the micro or the macro aspects from theto accelerate internal innovation, and expandIntroduction

11

the markets for external use of innovation, re-are financially viable for producer and con-

spectively. This paradigm assumes that firms

sumers alike. Carrillo-Hermosilla, et al. (2010)

can and should use external ideas as well assuggest sustainable innovation could be de-internal ideas, and internal and external paths

fined as innovation that improves sustainabili-

to market, as they look to advance their tech-ty performance, where such performance in-nology (Chesbrough, et al., 2006). The concept iscludes ecological, economic, and social criteria.

also related to user lead innovation (von Hip-

As such criteria differ as a result of spatial,pel, 1986), cumulative innovation: the process

temporal and cultural embeddedness, sustain-of building on the ideas of others to create

able innovation will have different meanings

new innovations (Reichman, 2001), know-how

and characteristics in different contexts.

trading: cooperative thought know-how trad-

The points here are that sustainable devel-ing between rivals and non-rival (von Hipple,

opment requires the transformation of larger

1987), mass innovation: by handling a large

parts of production and consumption systems.

number of participants (Bulc, 2013) and distrib-

Moreover, Boons, et al. (2013) pointed out in-

uted innovation. In short, innovation theory iscremental (product- and process-related) innova-

currently in a very close relationship with

tions in existing production and consumption

stakeholders and complexity. According tosystems may lead to further gradual improve-

Bulc (2013), “these types of innovation signifi-

ments of sustainability performance, but incantly broadened the circle of stakeholders

the end, incremental innovation frequently

necessary to generate enough ideas, inven-does not lead to a globally optimal systemtions and innovations. The innovation process

configuration in a multi-dimensional produc-started to include an increasing number of in-tion and consumption system space. Given thedividuals and groups that had the needed

challenges posed by sustainable development,competences (knowledge holders)”. Concurrent-sustainable innovation will often be character-ly, the relationship between corporations andized by systemness and radicalness. Generally,

NGOs has also changed from one of conflict tosustainable innovations go beyond regularlargely one of collaboration.

product and process innovations and are fu-

Meanwhile, according to Hagandon (2015),

ture-oriented (Charter, et al., 2007).

the overlap between sustainability and inno-

There does exist, on the other hand, social

vation warrants attention. “This is where theinnovation which is conceptually similar tochallenge of sustainability meets the promise

sustainability.“Social innovation is a term usedof innovation and the promise of sustainability

globally to describe and identify quite differ-

meets the challenge of innovation”, he says.

ent activities. While it is a term that everyone

Sustainable innovation centers on the develop-

likes to use, what it refers to not clear. Little

ment of new products or processes that con-is known about the requirements an innova-

sume fewer environmental resources, foster

tion has to fulfill in order to be a social one

the health of individuals and community, andand distinguish itself from other types of12Introduction

innovation”(Anderson, T., Curtis, A. and Wittig,

Certification” by Masaatsu Doi, Hosei Univer-C., 2014). Kahneman, et al. (2004) defined socialsity, discussed choices of organization and le-innovation as developing innovative solutions

gitimacy in society. After confirming limits

and new forms of organization and interac-and constraints in the market, resource mobi-tions to tackle social issues. Phills, et al. (2008)

lization, the legal area, and in society in Ja-

defined it as “a novel solution to a social prob-

pan’s social business, he pointed out that orga-

lem that is more effective, efficient, sustain-

nizational choice was not made only using

able, or just than existing solutions and forthese four standards, but decision making

which the value created accrues primarily tobased on the “thought” and “faith” of the nec-

society as a whole rather than private individ-

essary founder only ascertained what mightuals”. However, in order to be innovation, itsbe performed. He went on to explain the con-main components should be new products or

cept of the “benefit corporation” which is aservices and new systems to solve, not create

category of socially-oriented corporations insocial problems (Tanimoto, et al., 2013). Social

the U.S.

innovation needs to reconstruct the demand

not been verified.

But the effectiveness of these has

and supply chain if social innovation makes

The second contribution, “Social Businessthose promises. Therefore, it needs to ecosys-

Models: A Comparative Case Study of thetems that gather multi-stakeholders and facili-

German Beverage Market” written by Tobias

tates their understanding of socially-oriented

Bielenstein, Branding-Institute CMR, focused

goods and services. Thus far, research in en-on the question of just how “new” these busi-

trepreneurship and innovation has not dealt

nesses are that call themselves “new social

sufficiently with the role of the multi-stake-businesses”. He stated that the value proposi-

holder, and has tended to focus on the con-tion of social business in these case studies

sumer and supplier. Nor has it satisfactorily

addresses at least two stakeholder groups,

integrated micro and macro innovation, usual-particularly customers. He concluded that thely focussing on one or the other. These points

value position of the customer is key, and thatcome into focus in this conference.

symbolically these new social businesses canprovide insight into the role of the customer.

3.

Overview of Contributions

Thirdly, a contribution entitled “Access toEnergy with Awango by Total: a business so-

Next, we want to give an overview about in-lution to a social issue”, by Luigi Colantuoni –vited and reviewed articles as the contribu-

President, Total Group Representative in Ja-tion in this conference.

pan, and Mathieu Gougeon, Information
Management and Communication Officer, To-

3-1. Part I: Invited Articles

tal International, proposed a business solution

The first contribution, “Organizational Strate-

to a social issue through solar panel markets.

gy in Social Business: Study in Choice andCurrently over 1.3 billion people do not haveIntroduction

13

access to electricity. To enable off-grid accessorganizations. The reason for this diversity is

for low-income communities to meet some ofthat corporate forms have had to adapt to so-their most basic needs, “Awango By Total”

cial backgrounds or to focus on social prob-

has been introduced. It is a line of innovative,

lems. For example, entrepreneurs or theirreliable solar lighting and phone charging so-team may choose a nonprofit organization if

lutions. “The approach is practical, innovation-business domains need to collaborate withbased and embedded in our business opera-

government or need support in the form oftions”. The Group set an objective of im­prov-

grants. On the other hand, entrepreneurs

ing the daily lives of five million people bymay choose a profit-based corporation if they

selling one million Awango by Total solar

think the business can be established without

lamps by 2015. This goal has been met andexternal (primarily governmental) support. The

exceeded: by May 2015, one million solar

writer concludes that the corporate forms arelamps had been sold in Africa alone.

chosen based on extremely practical criteria.

The fourth contribution, “Contribution toSociety through Social Innovation” by Yukiko

3-2. Part II: Reviewed Articles

Araki, Corporate Officer at Hitachi, Ltd, posit-

This paper is “About the Relationship of theed social contribution using social innovation

Change of the Intermediate Support Organi-as the main domain of business. Hitachi be-zations and Support Target Tissue-Analysis

lieves social innovation that contributes to im-from the Point of View of the Knot Working”

provement of people’s quality of life createsby Nobuhide Horino. The research question of

not only economic value but also social andthis study is the issue of heterogynous inter-environmental value through collaboration

organizational relationships. In many cases,

with the customer. In 2015 they funded theheterogynous inter-organizational relation-

Global Center for Social Innovation. The Cen-

ships in Japan do not function effectively. In

ter is based in Tokyo, but has four branches

order for them to function, Horino emphasizes(the other three being in North America, China

the need for flexibility and a variety of inter-and Europe) focusing on researching and de-organizational ties.

veloping systems with or near customers. Hitachi says it places social innovation at the4.

Conference Outline

core of their business philosophy.
The fifth contribution, entitled “The corpo-

This year’s JFBS annual conference wasrate forms of social business” written by Eiji

structured in the following manner. The con-

Takeuchi, Japan Finance Corporation (JFC)

ference was kicked off by Mr. Yoshimitsu Ko-

discussed ways in which entrepreneurs

bayashi (Member of the Board and Chairman ofchoose corporate forms. In Japan, corporate

Mitsubishi Chemical Holdings Corporation andforms of social business are diverse, and in-

Chairman of Japan Association of Corporate Ex-

clude, for example, companies and nonprofit

ecutives) who gave a speech on the Manage-

14

Introduction

ment Codependent on Mother Earth. The

en.html

first Keynote Speech was followed by the
first Plenary Session including five panelists

4-1. Keynote Speech 1

and one session chair on Intrapreneurship“The Management Codependent on Motherand Sustainable Innovation, and then by the

Earth” by Yoshimitsu Kobayashi, Member of

second Keynote Speech by Mr. Richard Wel-

the Board, Chairman, Mitsubishi Chemical

ford (Chairman of CSR Asia) on Social Innova-

Holdings Corporation/ Chairman, Japan Asso-tion, Shared Value and Sustainable Develop-

ciation of Corporate Executives, Japan.

ment. Then the conference went into theseries of breakout sessions.

4-2. Plenary Session 1

Breakout sessions were conducted in two“Intrapreneurship and Sustainable Innovation”

formats: Breakout Session Organized andchaired by Sadao Nagaoka, Tokyo Keizai Uni-

Breakout Session (CFP).There are four ses-versity, Japan, with panelists Alan Aicken,

sions in Breakout Session Organized. They

Vice President and Chief Sustainability Offi-

are 1) Socially responsible enterprises andcer, Huawei Technologies, China, Yukiko Ara-

their corporate forms, 2) Fail Forward, 3)

ki, Corporate Officer, Executive General Man-

Business and Human Rights, and 4) Sustain-

ager, CSR and Environmental Strategy

able Regional Innovation. In Breakout Session

Division, Hitachi, Japan, Luigi Colantuoni,(CFP), eight themes were presented and dis-Chief Representative for Japan, Total, Presi-

cussed over ten different sessions: 1) Social

dent, Total Trading International, Tokyo

Entrepreneurship and Social Innovation, 2) So-

Branch, Japan, Joachim Schwalbach, Hum-cial Entrepreneurship, 3) Sustainable Finance:

boldt University of Berlin, Germany, and Kan-

CSR and Corporate Finance, 4) Innovation,

ji Tanimoto, Waseda University, Japan.

CSR, and SMEs, 5) Innovation and Environmental Management, 6) CSR and Marketing, 7)

4-3. Keynote Speech 2

CSR, Governance and Regulation, and 8) CSR“Social Innovation, Shared Value and Sustain-

and Management.

able Development” by Richard Welford,

Finally, the Plenary Session 2 was designed

Chairman, CSR Asia, Hong Kong.

to summarize the entire conference with eachsession chair briefly reporting the content of

4-4. Organized Breakout Sessions

discussion, and all participants exchanged(1) “ Socially Responsible Enterprises andopinions to synthesize the learning throughCorporate Forms” chaired by Masaatsu

various sessions.

Doi, Hosei University, Japan with panel-

The outlines of the sessions are summarized below.

ists: Sachiko Kishimoto, Executive Direc-

As for the detail of this entire

tor, Center for Public Resources Develop-

conference, please refer to the following web-

ment, Japan, Kenji Shino, Director ofsite: http://j-vbs.jp/annualconf-program_2015_

Environmental Programs, Patagonia Ja-

Introduction

15

pan, Japan, Eiji Takeuchi, Lead Econo-

Entrepreneurship: Social Entrepreneur-

mist, Japan Finance Corporation Researchship as the Forming of ‘Machine’ of ‘De-

Institute, Japan.

territorialization’” by Ted Yu-Chung Liu,

(2) “Fail Forward” chaired by Hiroshi Ame-

National Pingtung University, Taiwan,

miya, CEO, Corporate Citizenship Japan,

Stephen Dun-Hou Tsai, National Sun Yat-

Japan with panelists: Ashley Good,Sen University, Taiwan, and Roy Chih-Yu

Founder and CEO, Fail Forward, Canada,

Lee, National Sun Yat-Sen University,

Zaw Naing, Managing Director, Mandalay

Taiwan, “Social Entrepreneurs, Social

Technology, Myanmar, Yukie Ohno, Mer-Business and Corporate Structure: A

chandising Dept., Daichi Wo Mamoru Kai,

Comparative Case Study of the German

Japan.

Beverage Market” by Tobias Bielenstein,(3) “Business and Human Rights” chaired by

Branding-Institute CMR, Germany, and “A

Yasunobu Sato, The University of Tokyo,

Study of Problems and Prospectus ofJapan with panelists: Daisuke Takahashi,

Women Entrepreneurs: An Empirical In-

Partner, Shinwa Sohgoh Law Offices, Ja-sight on Beauty Parlor Business in Kath-pan, Saul Takahashi, Regional Represen-mandu” by Sunita Bhandari Ghimire,

tative for Japan, Business and Human

Tribhuvan University, Nepal.

Rights Resource Centre, Japan, Keiichi(2) “ Social Entrepreneurship” chaired by

Ushijima, Japan Area CCaSS Leader,

Toshiaki Yamamoto, Osaka Electro-Com-Managing Director, Ernst and Young

munication University, Japan with pre-Shinnihon LLC, Japan, and Richard Wel-sentations “Social Entrepreneurship byford, Chairman, CSR Asia, Hong Kong.

Student Entrepreneur to Solve Social(4) “ S u s t a i n a b l e R e g i o n a l I n n o v a t i o n ”

Problems” by Forhad Hossain, LBS Man-

chaired by Nobuyoshi Ohmuro, Kyoto

agement Consultancy, Bangladesh, “Sus-

Sangyo University, Japan with panelists:

tainable Development of Business in Rus-

Kazushi Kaneto, President, The Islands’sia” by Olga Bobrova, St. Petersburg

Company, Japan, Eisuke Tachikawa,State University of Economics, Russia.

Founder/Design Strategist, NOSIGNER,(3) “Sustainable Finance: CSR and Corporate

Japan, and Sayaka Watanabe, CEO and

Finance Ⅰ ” chaired by Shinichi Hirota,

Founder, re:terra, Japan.

Waseda University, Japan with presentations “Diversity, Ownership Structure

4-5. Breakout Sessions Based on Call for Papers

and Charitable Donation: A Stakeholder
View” by Chi-Jui Huang, National Taipei(1) “Social Entrepreneurship and Social In-

University, Taiwan, Heng Yih Liu, Yuan

novation” chaired by Kanji Tanimoto,

Ze University, Taiwan, Ting-Ling Lin, Na-

Waseda University, Japan with presenta-

tional Taipei University, Taiwan, and Yu-

tions “Exploring the Possibility of Social

Chiung Chen, National Taipei University,

16

Introduction

Taiwan, “The Relation between Institu-

tional Taipei University, Taiwan, Hsiang-tional Investors and Corporate Social Re-

Lin Chih, National Taipei University,

sponsibility in China” by Yuting Xue, Si-

Taiwan, “Study of the Relationship be-chuan University, China and Yingkai

tween Instrumental Behavior of Corpo-

Tang, Sichuan University, China, andrate Social Responsibility and Financial“Corporate Social Responsibility and Divi-

Performance” by Junxian Wang, Sichuan

dend Policy” by Yi-Cheng Shih, National

University, China and Mei Sun, Sichuan

Taipei University, Taiwan.

University, China, “Catering Effects: An-(4) “Doctoral Workshop” chaired by Hiroshi

other Perspective on the Determinants ofAmemiya, CEO, Corporate Citizenship Ja-

Corporate Social Responsibility Decisions”

pan, Japan, Joachim Schwalbach, Hum-by Mei-Chen Lin, National Taipei Univer-boldt University of Berlin, Germany, No-

sity, Taiwan and Hsiang-Lin Chih, Nation-buyoshi Ohmuro, Kyoto Sangyo Universi-

al Taipei University, Taiwan, and ”Corpo-

ty, Japan with a presentation “Chinese

rate Social Responsibility and Earnings –Entrepreneurs as Actors of Ecological

Announcement Drift” by Chan Chang,Conservation – the Case of the “SEE

National Taipei University, Taiwan, Wen-

Foundation”” by Constantin Holzer, Uni-

Chyan Ke, National Taipei University,

versity of Vienna, Austria and Renmin

Taiwan, and Mei Sun, Sichuan University,

University of China, China.

China.

(5) “Innovation, CSR, and SMEs” chaired by(7) “Innovation and Environmental Manage-

Franz Waldenberger, Deutsches Institutment” chaired by Keiko Zaima, Kyoto

für Japanstudien, Japan with presenta-

Sangyo University, Japan with presenta-

tions “The Effect of Ethical Sensitivity on

tions “Formative Process of Innovation

the Corporate Social Responsibility Inten-

System (IS): The case of Renewable Ener-tions to Promote SME’s Reputation” by

gy Technologies in ASEAN Countries” bySetyabudi Indartono, Yogyakarta State

Ya Min Thu, PhD Candidate, Ritsumeikan

University, Indonesia, Ratna Candra Sari,

University, Japan and Toshio Mitsufuji,

Yogyakarta State University, Indonesia,

Ritsumeikan University, Japan, “Exploring

Indah Mustikawati, Yogyakarta StateSI Contributing to the Sustainable Devel-

University, Indonesia.

opment of Innovation” by Toshio Mitsufu-(6) “Sustainable Finance: CSR and Corporate

ji, Ritsumeikan University, Japan and Ya

Finance Ⅱ ” chaired by Joachim Schwal-

Min Thu, PhD Candidate, Ritsumeikanbach, Humboldt University of Berlin, Ger-

University, Japan, and “Barriers of Imple-

many with presentations “Are thementing Reverse Logistics: the Case ofStrengths and Concerns in CSR of theSouth Australian Construction Sector” bySame Effects? Can They Be Offset? A Re-

Raufdeen Rameezdeen, University ofvised CSP Measure” by Tai-Hsi Wu, Na-

South Australia, Australia.

Introduction(8) “CSR and Marketing” chaired by Kyoko

Fukukawa, University of Bradford, UKwith presentations“Corporate Social Responsibility and Marketing” by Mie Myojin, Nakamura Gakuen University, Japan.

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