Entrepreneurs face tensions in remaining “authentic” but that word is notoriously difficult to define, says Dr Matthew Grimes, Reader in Organisational Theory & Information Systems and Co-Director of the Entrepreneurship Centre at Cambridge Judge Business School.
By Matthew Grimes
The concept of “authenticity” is ubiquitous these days – implied in phrases ranging from “fake news” to “virtue signalling” to “greenwashing”.
Yet what does it really mean to be “authentic”, given that there are so many different standards against which authenticity could be judged – ranging from action which is consistent with one’s internal values to the sustained conformity of a person’s actions to the norms of a given social category (e.g. authentic leadership)? In other words, the multiple dimensions of authenticity means that it can mean different things to different people.
These issues and questions surrounding the need for authenticity have particular consequences for entrepreneurs, as they often face pressure to engage in activities – to expand their business or perhaps even to ensure firm survival – that can feel like compromise to their sense of integrity or values.
In a study recently published in the Journal of Business Venturing, which I co-authored with Anna Wagenschwanz of consultancy Bain & Co. based in Germany, we explored how entrepreneurs differently make sense of their need for authenticity and how those differences in turn affect their approach to navigating values-based compromise in their business. We specifically focused on social entrepreneurs, wherein such compromises are more frequently experienced, due to the “hybrid” organisational commitments to both a social and commercial mission.
Most research on “hybridity” has focused on the organisational level, to analyse how such businesses use different strategies to sustain hybridity. We sought instead to understand how enterprise founders as individuals differ in response to these organsisational tensions.
Our final sample of entrepreneurs ranged from a firm that produces bicycles made from bamboo with fair-pay production in Africa, to an organic aquaculture shrimp company, to a company that donates a pair of shoes for every pair sold.
Some entrepreneurs in our sample drew on externally defined social categories in deciding what it means to remain authentic as they navigated compromise, and such social conformity took two forms: a desire to conform to the traditional founder role, or alternatively with the community of fellow social entrepreneurs. For instance, in an interview with one of these founders, he indicated that as his company navigates challenging moments, his desire is always to remain authentic to the premises underpinning social entrepreneurship, so as to serve as a “role model for other businesses.”
Yet others in our sample described self-fulfilment rather than adhering to a certain socially defined role as the most authentic path forward for a founder – in other words the ability to maintain internal consistency between their key values and their work. As one of them said in our interviews: “What did I come here for” and “What am I doing for society” were the key questions that guided both the founding of her business as well as the approach to responding to compromise.
Given these stark differences in approach, it’s clear that authenticity in enterprise is often “in the eye of the beholder” – and that gives us plenty of room for additional research into tensions that will always permeate the fascinating area of social enterprise.