Shared purpose? The family business as a sustainable system 'irritator' in the sustainable entrepreneurial ecosystem

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PWO (Odisee)

Introduction

Due to climate change, environmental degradation, wars, and conflicts, the permacrisis affects societies, across multiple regions and sectors. Sustainable Entrepreneurial Ecosystems (SEEs) emphasize the importance of adopting a systemic perspective for furthering responses to permacrisis (e.g., Bischoff, 2021; Cunha et al., 2020; O'Shea et al., 2021; Pankov et al., 2021). Although embracing a sustainable systemic mindset is recognized as a key component to fulfilling the purpose of sustainability (e.g., Theodoraki et al., 2022; Volkmann et al., 2021), little is known about how such a shared purpose is developed among stakeholders in SEEs.

Starting from the premise that SEEs favors stakeholders with a systems-oriented shared purpose, this paper aims to investigate the role of the family business in inducing a change in the collective mindset of the SEE due to permacrisis. Given that family firms are embedded in the communities or regions in which they are active (Baù et al., 2019), they tend to have long-lasting relationships with a community of stakeholders. Family businesses are also more familiar with systemic thinking in terms of family, business, and ownership systems (Le-Breton-Miller and Miller, 2019) and can potentially play an important role in inducing a sustainability purpose among SEE stakeholders. This paper examines this gap in the literature of family business and SEEs.

This paper conducts a single case study on the role of a family business in the formation of a SEE, addressing the research question: How does a family business induce a sustainable purpose among SEE stakeholders? To answer the research question, we employed the concept of system irritation from Luhmann (2018). System irritation is defined as a change in the environment of the organization that creates confusion and calls for a decision on whether to react to this change. Such irritation is deliberately created by what we call a system irritator, intending to challenge existing patterns (Luhmann (2018). This conceptual framework offers the possibility to explore the development of a shared purpose among SEE stakeholders.

SEEs offers a promising new field of research that combines the ecosystems' approach with the role of businesses in driving society's transformation toward sustainability (e.g., Theodoraki et al., 2022; Volkmann et al., 2021). Research has, so far, focused on stakeholders' motives and resources to engage in ecosystems ('interconnected') (Cunha et al., 2020; Pera et al., 2016), the co-creation of entrepreneurial opportunities ('entrepreneurship') (O'Shea et al., 2021), and the identification of contextual factors facilitating or impeding SEEs (Bischoff, 2021; Pankov et al., 2021).

Despite the centrality of "systems" in SEE theorizing, the literature addresses systems in at least two ways. First, the ecosystem concept assumes a systemic ontology, and thus, stakeholders are being interconnected (e.g., O'Shea et al., 2021; Pankov et al., 2021; Stam, 2015; Volkmann et al., 2021). Secondly, the permacrisis requires stakeholders to become aware of the system, for it will enable them to act upon their interconnectedness purposefully (e.g., Bischoff, 2021; Cohen, 2006; Raworth, 2017). Still, mobilizing stakeholders for participation in a SEE might be challenging due to a possible misalignment between individual entrepreneurial missions and SEE's approaches. It is here that family businesses may play a crucial role in inducing a sustainable purpose in a SEE.

Family businesses are commonly embedded in communities engaging in socially responsible behavior (Berrone et al., 2010; Niehm et al., 2008). They also might act as stewards in building a purpose allowing long-term relationships and mutual gains (Arregle, 2007). Because of their intergenerational aspirations, they are more responsive to environmental pressures, which might influence how they in turn act

toward their stakeholders (Berrone et al., 2013). Exploring, thus how the role of the family business influences a SEE in permacrisis is therefore relevant.

We adopt Niklas Luhmann's theory of organization (2018) which helps build theory on the family business influence in the establishment of a SEE. Specifically, Luhmann's concepts of decisions (communications), irritation, and meaning offer a foundation to examine the influence of a family business in shaping a sustainable purpose among SEE stakeholders. Decisions are an organization's unique operative mode while meaning entails three dimensions:

  • time dimension (i.e., deciding on the start of the interaction and on a certain time limit)
  • social dimension (i.e., who is to participate and, consequently, what social perspectives become available in the interaction)
  • fact dimension (i.e., the selection of the topics that can be discussed)

Establishing a SEE shared purpose, we argue, requires its member organizations to co-construct a founding decision and meaning, while irritation challenges existing decision replications and existing meanings due to an increased awareness of the permacrisis.

The paper contributes to the literature on family business and SEE, by highlighting the role of family business as a system irritator in inducing a sustainable systemic mindset among SEE participants. System irritators raise awareness of uncomfortable replications and initiate a gradual systemic change in line with the family business values. Such a role has not been addressed by the literature on family business or SEEs (cf. O'Shea et al., 2021; Pankov et al., 2021; Theodoraki et al., 2022; Volkmann et al., 2021). Second, we contribute to family business literature by taking the stakeholder perspective a step further toward SEEs.

To examine the role of the family business in the development of a shared purpose in the SEE, we conducted semi-structured interviews with the family business and key local stakeholders in the SEE. We collected data on a Belgian food service family business that sought to increase its sustainability impact by establishing SEEs. In our analytical procedure, we relied on the analogy of a geocentric view versus a heliocentric view. This meant that, in a heliocentric view, the stakeholders of the family businesses were identified as part of an ecosystem. Then, we employed a geocentric view to understand the position of stakeholders in their environment, with the family business being central and connected with stakeholders around them. With this, we were able to observe that family business played the role of irritator to push participants in a SEE to challenge the dominant meanings and decisions toward a shared purpose.

Our preliminary analysis shows that the family business takes up the role of system irritator. The family business sought to 'irritate' the SEE by undertaking a series of actions. These actions resulted from the mapping of common themes among stakeholders connected to the increased awareness of the permacrisis effects. The family business employed the themes to mobilize the SEE for a shared sustainability purpose. The themes challenged existing meanings and ideas and raised awareness of the strength of potential joint action; stakeholders became aware that they were part of an interconnected regional subsystem. The family business made participants aware that their decisions mattered in replicating certain unsustainable patterns. Although the family business irritation did not create a change of awareness of every element of a system, it set in motion a gradual change towards a more sustainable EE and opened doors towards a shared sustainable purpose.

 

 

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