2020 Volume 17 Pages 101-117
In recent years, corporate social innovations (CSI) through their businesses are required all over the world. CSI is deeply connected to corporate social responsibility (CSR). Previous studies have shown that CSR has emphasized the potential for innovation. Legitimacy has to be proven to stakeholders for resource mobilization to implement CSI. This study explores the CSI process and their legitimacies through two case studies in Japan. It also provides an insight into a new concept of “exclusiveness” in CSI, and into social entrepreneurs decision-making processes. This paper highlighted the following: first, social entrepreneurs emphasize moral or cognitive legitimacy in the promotion of CSI as well as paying attention to pragmatic legitimacy. Second, we can draw out four types of CSI legitimacies: social environmental factors, external human resource factors, internal cultural factors, and internal technical factors. And third, social entrepreneurs have their own unique reasons for these CSIs implementation, and therefore have to decrease their “exclusiveness” in CSI process.
This paper will assert legitimacy of social innovation, especially of corporate social innovation (CSI) and also proposes a new concept of “exclusiveness in social innovation”1. Social Innovation requires resources that transform new ideas into social products or social business models. However, a new social business project in a company at the outset, uncertainty always prevails both economically and socially. There is no clear consensus that the new social innovative idea will do well for itself in the end. Furthermore, social innovation has ‘exclusiveness’ by nature that means the social innovation is for particular stakeholders only. In other words, social entrepreneurs have “their own motivations” for implementing the social innovation. It’s necessary for social entrepreneurs to show stakeholders the legitimacy for mobilizing their resources, and have to decrease the exclusiveness in social innovation.
Social innovation refers to an innovation that produces economic and social achievements with creating new social values through the businesses addressing the resolution of social challenges. The importance of the legitimacy of resources acquisition in promoting corporate social innovation can be explained by the fact that it is extremely difficult for several reasons: the lower expectation of the profitability, the measurement and evaluation of the social impacts through the business activities due to its complex nature as it is the combination of various elements. Drawing on examples of successful companies such as Yamato Holdings, Yamaha and Yamaha Motor, this paper examines the CSI process of these established Japanese firms and how social entrepreneurs create the legitimacy creatively and flexibly as the situation demands.
CSI or social innovation is deeply tied to corporate social responsibility (CSR). For many studies, CSR or sustainability has emphasized the potential for innovation. For example, Yoon and Tello (2009) argue that a consistent commitment to CSR helps an organization continue to be innovative and competitive through the cases of Toyota Motor and Whole Foods. Nidumol et al. (2009) also point out that among the drivers for innovation, CSR is one of the most important. And also, over the last decade more and more innovation research has addressed the concept and potentials of CSI (Aagaard, 2018). In other words, companies can contribute very well to solve some of the world’s social and environmental challenges, while at the same time develop new social products, services, and business models. Furthermore, CSR-driven social innovation can increase their competitiveness and reputation in the long view.
For the purpose of this paper, social innovation is defined as follows: an innovation that produces economic and social impacts with creating new social values through the businesses addressing the resolution of social issues. There are three important points to this definition. First, as Shumpeter (1934) defined it, innovation is considered to be a new combination of new elements (the introduction of a new product, the introduction of a new production method, the opening of a new market, the conquest of a new source of raw material and the implementation of a new way of organization) which were not seen in any previous economic systems. Second, one of the roles of innovation is that of adopting a problem-solving approach. Unlike the eco-innovation literature, this definition includes not only the environmental problems but also the social and ethical problems. The term “problem-solving” here means to take a certain action in solving a problem, and to utilize innovation to solve those social issues (such as the environment, education and welfare reforms) which have traditionally existed in conventional socio-economic systems. And third, social innovation finally leads to the diffusion of new social values. Unfortunately, it’s not easy to rethink values and social values. Some authors argued that social entrepreneurship allows for a more systemic understanding of the links between social and environmental problems, and offer better ways of finding innovative solutions for them (Kury, 2012; Tanimoto et al., 2013). What is needed is an understanding of ‘social value’ that goes beyond financial value and creates ways of living that allows for this social value to be created and safeguarded through the social innovation process.
Figure 1 shows the process of social innovation, which develops social business and diffuses new social values.
Source: based on Tanimoto ed. 2006 and Tanimoto & Doi 2007
This paper focuses on the corporate social innovation, not on the startup ventures’ social innovation. Googins (2013) defined corporate social innovation as follows: a strategy that combines the unique set of corporate assets (entrepreneurial skills, innovation capacities, managerial acumen, ability to scale, etc.) in collaboration with the assets of other sectors to co-create breakthrough solutions to complex social, economic, and environmental issues that impact the sustainability of both business and society. He also pointed out that innovation is rarely associated with CSR. This paper illustrates the relationship between CSI and CSR through two case studies in Japan. As Aagaard (2017) already showed, what is really needed is an improved understanding and implementation of social and sustainable business and innovation management into corporate practices and performances in creating and testing new social innovations and sustainable business models at the corporate level.
Although some characteristics of social innovation are similar to business innovation, others are completely different. It is true that some of the concepts and frameworks found in studies on business innovation are adaptable to social innovation (Tanimoto, 2012).
There are two conditions for realizing business innovation: the creation of knowledge and resource mobilization. In terms of the latter, Takeishi et al. (2010) conducted a study that mainly dealt with the justification for acquiring resources in business innovation as a new business development. Regarding the grounds for justifying resources acquisition in business innovation, this study listed the following four types of reasons for justification out of eighteen case analyses which received an Okochi Prize2: (i) Point of View Placing Emphasis on Technology, (ii) Leadership by Top Management, (iii) Acquisition of Supporters, and (iv) Sense of Crisis as Party Concerned. The legitimacy herein generally refers to “decent grounds”.
Suchman (1995) previously defined legitimacy as a “generalized perception or assumption that the actions of an entity are desirable, proper, or appropriate within some socially constructed system of norms, values, beliefs, and definitions”. Different types of legitimacy are classified roughly into “moral legitimacy” based on normative evaluations, “cognitive legitimacy” authorized by the acceptance according to implicit sense of values and belief, and “pragmatic legitimacy” depending on the interests and preferences of persons making a judgement on the legitimacy.
Among those three types of legitimacy, what has been considered most effective for the acquisition of resources is their expectation and prospect for economic outcomes and accompanying business revenues to be later obtained through such innovation. In short, it is economic rationality being classified as a “pragmatic legitimacy”. The higher and more secured economic rationality an entity had recognized in advance, the higher chance of resources acquisition it has. Although the stakeholders cannot be a 100% sure of the outcome, they can achieve the procurement of resources as long as a majority has an expectation that results will be obtained under an acceptable risk. Even though an investment is eventually made for the commercialization of a project in the hope that it will make profits, the procurement of resources has to be justified during the processes before such investment is made even under a situation where its economic rationality is not recognized objectively. The more certain expectations are, the easier resource mobilization becomes. This paper will assert that the three types of legitimacy should be applied within the context of social innovation more than business innovation, i.e. resource acquisition and theoretical arguments.
The concept of legitimacy within the context of an organization is defined as the conformity to the organizational forms, procedures, rules and practices within the widely accepted social norms and legal structure (Suchman, 1995). Organizations acquire legitimacy through many strategies: such as agreeing with the leader of a high-status institution, or gaining recognition from high-status actors. Agrawal and Hockers (2013) asserted that social entrepreneurial organizations gain legitimacy by getting awards and recognition from high status institutions such as the Ashoka Fellowship, the Acumen Fund Fellowship, the Schuwab Entrepreneur of the year award. Furthermore, they argued that a legitimate organization has access to resources and tends to survive longer than illegitimate organizations.
2.2 Analytical FrameworkIn this paper, I consider legitimacy as a valuable social construction that helps organizations and social entrepreneurs drive social innovation processes forward. Social innovations unlike business innovations, by virtue of their social mission, need various types of legitimacy, which is recognition from governmental actors, investors, employees, and high-status organizations. Of course, in any organization, there are internal and external reasons to implement the social innovation. Generally speaking, in the case of CSI, external reasons are made by virtue of their social mission. However internal reasons are sometimes different from external reasons. This could be compared to the social phenomenon called “Honne and Tatemae”3 in Japan. In previous research, most of their true internal reasons have never been made public.
I investigated, in particular (1) what was the “internal reasons” for social entrepreneurs to implement CSI process, (2) what kind of legitimacy social entrepreneurs obtained, (3) how social entrepreneurs obtained such legitimacy, and (4) to whom they proved such legitimacy, along with the process of CSI.
As indicated previously, there are various types of legitimacy. Also, there are three strategies for gaining legitimacy: conforming to the preexisting actors, selecting the most favorable actors, and manipulating the relevant actors (Suchman, 1995). In the first strategy, which is the most passive among the three strategies, one seeks legitimacy by conforming to the dictates of preexisting audiences within one’s current situation. In the second strategy, which is more proactive than the first, one selects favorable actors that would be willing to admit the legitimacy “as is” without demanding many changes in return. In the third strategy, which is the most proactive, one manipulates actors by creating new audiences and new legitimating beliefs (Takeishi et al., 2010).
This paper observes the entire process of corporate social innovation, from the initial stage of recognition of social issue and development of social business model, and finally to diffusion of new social values. Furthermore, I analyzed what strategies were taken to obtain the legitimacy, what types of legitimacy were used, and which stakeholders were chosen towards achieving corporate social innovation.
2.3 Research MethodologyA Case study is suited to the research question which requires detailed understanding of social and organizational processes, because of the rich data collected in context (Hartley, 2004). We have been engaged in an ethnographic research on social innovation process in Japan. In the case of Yamato Group, we had several interviews with Yamato Holdings staff member Masato Kosaka (in charge of CSR) in 2011, and also had an interview with Yamato Group’s Advisor Keiji Aritomi in 2013. In the case of Yamaha and Yamaha Motors, I had several interviews with product designer Sunao Okamura (Yamaha), Masashi Nomura (Yamaha Motor), art director Yoshie Kurisu (SLOW LABEL) in 2017. The in-depth interviews were face-to-face in order to understand their dynamic social innovation process. Other important sources of data are their presentations and statements at the symposium and lecture meetings. These two types of sources are our basic research data.
The Yamato Group: a private company, which through its logistic services such as “TA-Q-BIN”, which started as a consumer-to-consumer (C2C) delivery service, has developed strong roots in local communities all over Japan. Their management philosophy is as follows4:
The Yamato Group helps enrich our society by enhancing the social infrastructure of TA-Q-BIN networks, creating more convenient services for comfortable lifestyles, and developing an innovative logistics systems.
In addition to their philosophy, the Yamato Group has several unique mottos: “Service comes first, and profits will follow”, “Everybody is involved in management”, and “We all represent the company”. “We all represent the company” means that each and every staff member knows that their actions always reflect on Yamato. The founder of the company, Yasuomi Ogura, formulated these mottos in 1931.
Without these local communities, their business would not exit. Therefore, the Yamato Group wanted to give something back to those communities. And so, they came up with an innovative donation program through the TA-Q-BIN service during the Great East Japan Earthquake of March 11th 2011. The massive earthquake and tsunami caused disaster in the Tohoku region and resulted in a large number of fatalities. The company had resolved to help in the recovery efforts, aiming for activities that provided visible, rapid, and highly effective support. Social entrepreneur, Makoto Kigawa, the president of Yamato Holdings at the time, decided on April 1st 2011 that they would contribute to the Tohoku disaster relief by donating 10 Yen for each “TA-Q-BIN” parcel that they deliver for a whole year. As a private for-profit company in Japan, it may be difficult to donate a very large sum in one installment to a good cause. However, when the funds are accumulated consistently over the course of a year, this becomes more feasible. Therefore, the Yamato Group adopted the 10-yen per parcel approach. Kigawa reflected on those days and then stated5:
“Ever since its founding 92 years ago, and in particular since the creation of TA-Q-BIN 35 years ago and subsequent introduction of Cool TA-Q-BIN, Yamato owes a great deal to its many customers in the Tohoku region. How could we show our gratitude and support? We decided that the appropriate way to repay them would be through helping to restore the basic infrastructure for fisheries, agriculture and daily life.”
Therefore, Kigawa, as the top management leader, decided to give something back to the Tohoku Area in return for the rapid growth of TA-Q-BIN.
Given that in fiscal year 2011 they expected to handle around 1.4 billion “TA-Q-BIN” parcels, the donation amount would come to about 14 billion JPY (approximately 172 million USD), which is about 40 percent of the yearly net income of the Yamato Group.
This was unheard of as far as corporate donations go. Yamato Group’s top management was worried at that time that this would become an issue for the shareholders, especially foreign institutional investors. In reality, their shareholders embraced this unique donation idea at the relevant shareholders meetings.
There was, however, an issue with taxes. In Japan, corporate donations to government organizations are tax-free. Then they are allocated by the government as they see fit. However, Yamato Group wanted to donate the full amount to the Tohoku region for the restoration of their local industries (fishing, seafood, and agriculture). On this, Kigawa said6:
“According to our existing corporate tax lows, we were told, ‘what you are saying is really selfish. it’s taxable income’.”
At that time, he seriously thought that a private company could do such a public activity through their businesses, and he strongly wanted to show “the power” of the private sector for society, and to change the Japanese corporate donation culture. Here, we can point out that his way of thinking, “Yamato Group wanted to donate the full amount to the Tohoku region without paying taxes”, had really high exclusiveness value.
From April 2011, the company negotiated with the Ministry of Finance for one-and-a-half months, and thanks to external supporters, who had welcomed this donation idea, they were finally able to formulate a solution within the existing legal framework.
By applying the proviso for ‘specified donations’, Yamato was allowed to donate the full amount. Also, the Yamato Group adopted the basic policy of “visible support, fast support, and effective support”, and focused on doing something that the private sector could do, including support for projects that would have difficulties attracting government financial support, as well as contribution to establishing a new donation model. This was a new and valuable donation model as a private enterprise in Japan (Doi & Misui, 2013).
Specifically, we focused on how the idea arose, and how the final model was established, and what kind of legitimacy was expressed to acquire the necessary resources and empathy. As a result of the analysis, four factors were found that affected the legitimacy of the Yamato’s program: (1) corporate culture (core value: we all represent the company), (2) a sense of crisis in society caused by the earthquake, (3) the Yamato Group’s awareness of CSR activities before the earthquake, and (4) external supporters.
Furthermore, the study discloses the fact that these four factors of legitimacy were not already in place at the time the idea came about, but were created flexibly after the event as the situation demanded, obtaining consent and support from the stakeholders of the Yamato Group.
In the following section, the details of social innovation phases and stakeholders are described (Figure 2).
Phase 1, Kigawa and the top management team made the decision on March 31st 2011. Kigawa announced the concept to the Yamato group executives when he became Yamato Holdings’ CEO on April 1st. Regarding this decision, CSR officer at that time stated7:
“As Yamato truck drivers in Tohoku region helped the local community spontaneously with their truck, Kigawa thought Yamato Group must somehow take action as a company. And considering the circumstances of the disaster area at that time, the fad relief money (Gienkin in Japanese) was totally inadequate. In addition, he wanted to send an encouraging message (corporate huge decision) to the local staff.”
According to this, immediately after the earthquake, social entrepreneurs, after thinking it over for a few days, came up with this huge donation plan through the TA-Q-BIN business.
Phase 2, social entrepreneurs had to illustrate the reasonable legitimacy, which is “Yamato’s Core Value: We all represent the company” for one hundred seventeen thousand employees. Kigawa said: “For me, the Great East Japan Earthquake of March 2011 reaffirmed the importance of Yamato Group’s management philosophy, which is to help enrich our society by enhancing the social infrastructure of TA-Q-BIN networks, creating more convenient services for comfortable lifestyles and developing an innovative logistic system” (Yamato Holdings, 2012, p.5). For the Yamato Group, the management philosophy is the DNA that defines them. Social Entrepreneurs thought that they should present this management philosophy to the employees as a rational reason to implement the huge donation plan.
Also, social entrepreneurs had to persuade institutional investors, which pursue the economical return in general, to accept this huge donation program. Of course, they had to persuade the Ministry of Finance that didn’t admit the change of taxation system easily. At the time, they illustrated the reasonable legitimacy, which is Yamato Group’s awareness of CSR activities before the earthquake. Finally, Yamato Group acquired special treatment as “designated donation” without any amendment of tax law. Ministry of Finance authorized this special treatment on June 24th, four days before the Yamato Holding’s general shareholders meeting.
Phase 3, the Yamato Group had to justify the reasonable legitimacy of this donation program, to their customers, so to avoid it be mistaken for a greedy marketing campaign. On April 11th, they sent a message via an advertisement in the newspapers, Our employees, many of whom are also affected by the disaster and lost a great deal, are responding in ways that come from knowing the community and the people so well. Through their actions, they are showing the rest of the 170,000 Yamato Group employees throughout Japan what it is we should be doing now. Yamato handles about 1.3 billion parcels annually. By donating 10 JPY for every parcel we deliver, about 13 billion JPY can be collected in a year to help fund restoration efforts. Our charges will not change. But the funds we collect will be generated through our business and with the assistance of our customers throughout the country.
We understand this message as a communication tool between the Yamato Group and their customers in order to foster “a sense of crisis in society caused by the earthquake”. As mentioned before, “TA-Q-BIN” handling volume in the fiscal year ending March 2012 increased by 7.6% from the previous year. We can see that this gain means that customers were basically satisfied with this service and the donation program.
Phase 4, Yamato Group continued tenacious negotiations with the Ministry of Finance for one-and-a-half months in order to give the full collected amount to the disaster regions without paying taxes. In this phase, Yamato was incredibly lucky to have ‘external supporters’ on their side. These supporters had assessed Yamato Group’s CSR activities, and given them high praises for a long time.
Furthermore, they had to overcome one more obstacle: their foundation status. In Japan, in order to be able to donate the full collected amount to the disaster regions, companies have to donate through what is called a “Public Interest Incorporated Foundation”, and not through a “General Incorporated Foundation” like Yamato had at the time. After the Great East Japan Earthquake of 2011, many groups working on relief activities opted to become General Associations due to the ease of incorporation, rather than Public Interest Incorporated Foundations, which still require several “authorization” hurdles in order to incorporate8. The privilege of Public Interest Incorporated Corporation is that their donor can enjoy tax deductions.
By sheer luck, months before the earthquake, Yamato had planned to change their foundation status from “general” to “public”. Under this status, companies are able to donate 100% of all amount collected. Ultimately, Yamato was able to donate about 14.218 billion yen towards helping restore the basic infrastructure for fisheries, agriculture, and daily life, with a total of 31 projects. In this phase, social entrepreneurs had to use their own existing CSR resources, like their own incorporated foundation on the spot. These resources used daily in their CSR activities, bore fruitful results both for Yamato and the communities they served. On their website, Yamato disclosed how these funds were used to the very last yen.
Phase 5, Yamato Group actually showed a new possible donation approach in Japan, but as of today, no companies comparable to Yamato have used this new approach. In this huge natural disaster that left over 15,000 people dead or missing, existing donation approaches didn’t have a sense of urgency. The donations to the Japanese Red Cross Society, for example, are traditional and typical ways of donating, which are “indirect, slow, and opaque” for private companies and their stockholders. On the other hand, Yamato used a new approach, which is a “direct, fast and transparent” way. We will continue observing Japanese companies’ donation trends.
In these processes, we found that the Yamato Group designed and emphasized their corporate philosophy as normative guideline. This means they proposed “moral legitimacy” and “cognitive legitimacy” to the internal stakeholders to implement this unique innovation process. By applying the elements of prior and existing institutions for the creation of new institutions (Stark, 1996), and by “making do with what was at hand” (Levi-strauss, 1966), Yamato showed that they applied entrepreneurial bricolage concept in their CSI process.
3.2 The Yamaha’s Social Innovation and LegitimacyYamaha Corporation (hereafter “Yamaha”) and Yamaha Motor, Co. Ltd (hereafter “Yamaha Motor”) have joined forces to work together to develop a project under a single theme- &Y (Andy). With “&Y” the two companies have designed the “&Y01”, an electrically power-assisted wheelchair that plays music, and so far, have produced three concept models in collaboration with Slow Label, a non-profit organization. These concept models will be used in performances of “SLOW MOVEMENT- the Eternal Symphony” by Slow Label, an initiative which links local and international artists and designers with businesses and welfare facilities in crafting new products and concepts that make the most of their distinctive characteristics.
To quote Yamaha Motor, “The &Y01 evokes an image of white yacht cutting through the waves as the sailor intends”. This design concept model has been used at a variety of events and performances. “The light and nimble movement of Yamaha Motor’s JW Swing electrically power-assisted wheelchair comes together with Yamaha’s TLF (Thin, Light, and Flexible) speaker and thin percussion instruments on both sides of the wheelchair, create a new experience akin to ‘riding a musical instrument’”. The riders naturally become performers, creating a sense of unity with the surroundings by making sound and music as they move. In 2017, Yamaha and Yamaha Motor received the internationally-prestigious “Red Dot Award: Design Concept9” for this innovative design.
As a result of the analysis, four factors were found that affected the legitimacy of the Yamaha program: (1) The advertising expectation (brand recognition) at the Tokyo 2020 Paralympic Opening Ceremony, (2) Corporate Philosophy, (3) Point of View Placing Emphasis on Technology, and (4) Social Catalyst.
In the following section, the details of social innovation phases and stakeholders are described (Figure 3).
Phase 1, Yoshie Kris, director of SLOW Label, had wanted to connect body and technology for a long time. In 2014, she came up with a new concept of a wheelchair that would play music. She remembered that Yamaha Motor produced the “02GEN”, which is a design concept model for an electrically assisted wheelchair10. This concept model pursued not only the functionality and safety of the user but also “comfort, beautiful user posture when seated, and a sense of synergy between the user and the wheelchair”. She then approached Yamaha Motor. Regarding this point, Kris stated11:
“I insisted on collaborating with Yamaha and Yamaha Motor instead of university laboratories or small factories. It would have enormous significance to the Japanese people to have this project carried out during the 2020 Olympic and Paralympic Games by these two well-known and trusted Japanese multinational companies. By doing so, these two companies will certainly give disabled people great hope.”
At that time, both Yamaha and Yamaha Motor were looking toward innovative ways to develop products that would embody the unique style of delving into the possibilities of fusing musical instruments and audio equipment designs with motorcycles and other mobility designs.
Phase 2, the general managers of both companies intuitively endorsed this unique proposal. They thought they could strengthen their common corporate philosophy, which is “sharing new ‘kando’ and rich culture with as many people as possible”(Yamaha Motor website) through this project. At that point, this project didn’t make the unanimity. Strong objections were voiced against its development due to its low economic and social impacts. Kris and the Yamaha Motor designer argued that this project would generate good publicity for the two companies at the Tokyo 2020 Paralympic opening ceremony of which Yoshie Kris had been appointed Art director. As an example, the 2014 Yokohama Paratriennale12 was mentioned, where companies made an estimated over 60 million yen through advertisements.
Despite all the arguments, they were unable to get the green light to get a prototype made.
Eventually, the project was saved by Masashi Nomura, director of IM Operations JW Wheelchairs13 Division at Yamaha Motor’s. As the director but also as an engineer, he had strong interests in developing this new wheelchair concept. Especially, in those days, Yamaha Motor was unsatisfied with the recognition of their power-assisted wheelchairs in Japan. Therefore, through this project Nomura hoped to develop it. Regarding this point, Nomura stated14:
I told them “I could do it”, because this project had the potential for new products development in the future. So, for our department (JW), we felt positive about this project.
In this case, at least, Yamaha Motor had an important driving force, which was a technology-oriented mentality, where engineers were keen to develop new technologies, even if there was little prospect of business success (see Takeishi et al.).
Furthermore, from the viewpoint of the organizational collaboration, Kris was a definitive “social catalyst” in uniting these two companies. On this point, Kris stated15:
“Since my twenties, as a career, I have been connecting handicapped people and the non-handicapped, and handicapped and business people. So, if I could serve as a ‘cushion’ between these two companies, they could collaborate with each other on a new social project, when they couldn’t do it on their own.”
As a result of the analysis, four factors were found that affected the legitimacy of the &Y01 project: (1) The advertising expectation (brand recognition) at the Tokyo 2020 Paralympic Opening Ceremony16, (2) Corporate philosophy: sharing new “Kando”* and rich culture with as many people as possible, (3) Point of view placing emphasis on technology, and (4) Social Catalyst: an outsider to the corporation who is a professional in the social sector (sometimes an insider of the corporation who has professional information in social related issues).
These four factors of legitimacy were flexibly shaped as the situation demanded at the time, obtaining consent and support from the stakeholders of both companies.
In these processes, we found that they designed and emphasized “pragmatic legitimacy (the expectation at Tokyo 2020 Paralympic Games, point of view placing emphasis on technology)” and “cognitive legitimacy (corporate philosophy)” to the internal stakeholders.
In this paper, I advocate the importance of legitimacy to research a corporate social innovation process from the resource mobilization framework. In this process, I highlight how social entrepreneurs design and emphasize “moral legitimacy” or “cognitive legitimacy” in the promotion of social innovation, as well as paying attention to “pragmatic legitimacy” that has traditionally been discussed in the field of business innovation.
However, this study is still in progress. The Yamaha case study has not been completed yet. Thus, it’s too early to draw a definitive conclusion. Instead, I would like to make some preliminary discussions based on the data we’ve collected so far.
First, in terms of CSI, social entrepreneurs have to require consideration of acquiring not just legitimacy based on economical standard, but legitimacy based on multiple evaluation axes. According to our qualitative case studies, social entrepreneurs used their corporate philosophy and corporate culture to convince their internal stakeholders in both cases. In other words, social entrepreneurs need to acquire empathy from internal and external stakeholders to implement the CSI. Especially, to solve these social problems, it’s important for them to collaborate with various stakeholders, and its true nature is acquiring “empathy and support” from them. Table 1 shows who the social entrepreneurs are, and the kinds of resistance from stakeholders that they faced, during the corporate social innovation process, and ultimately overcame through the supports obtained. In the case of Yamato, the social entrepreneurs needed the stakeholder’s understanding of a new corporate donation culture. In other words, Yamato had to acquire “the socially constructed empathy” from the various stakeholders to implement this corporate social innovation. In the case of Yamaha Co. and Yamaha Motor, as mentioned earlier in this paper, social entrepreneurs have been required to demonstrate the economic rationality to the financial managers at headquarters.
| Cases | Social entrepreneurs and supports | Resistance against implementation of corporate social innovation: Resistance from stakeholders in each phase |
|||
|---|---|---|---|---|---|
| Social Entrepreneur | Support obtained | Resistance existed | No resistance | ||
| Yamato Group | Donation of 10 Yen per TA-Q-BIN Parcel Delivered | Makoto Kigawa (President of Yamato Holdings) & Keiji Aritomi (Director of Yamato Welfare Foundation) | Originally, Started from Kigawa’s personal idea. Obtained from Yamato Welfare Foundations Support. |
(Phase 4) the Ministry of Finance required the corporate tax about 5 billion JPY. | (Phase1–3) (Phase 5) |
| Yamaha Corporation and Yamaha Motor | &Y 01 (electrically power-assisted wheelchair that play music) | Yoshie Kris (SLOW LABEL) | Originally, Started from the needs of SLOW LABEL. Obtained the engineer’s technological interest. |
(Phase 2) Pressure against the project from financial point of view | (Phase 1) |
Second, from our two case studies, we can draw out four types of CSI legitimacies: (1) Social environmental factors, (2) External human resource factors, (3) Internal cultural factors, and (4) Internal technical factors.
Social environmental factors mean social phenomena such as a sense of crisis in society caused by the earthquake and the 2020 Tokyo Olympic and Paralympic Games. We take it for granted that social entrepreneurs can use these legitimacy factors, but these social environmental factors come to be foundational reasons and sometimes to be moral legitimacy. External human resource factors include such strong supporters who praise these unique ideas, and social catalyst who can cause chemical changes in static situations. Internal cultural factors include corporate culture, corporate philosophy. These factors lead to building cognitive legitimacy. Finally, Internal technical factors include literally the point of view placing emphasis on technology by engineers.
Third, social entrepreneurs have to decrease their “exclusiveness” in CSI process. As previously mentioned, “exclusiveness” means the social innovation is for particular stakeholders only. From this viewpoint, if social entrepreneurs could decrease the “exclusiveness”, they could secure more resources. Generally speaking, in the case of social innovation, these target social issues such as environmental or welfare, have high “exclusiveness”. As stakeholders are not always intensely interested in these social issues, social entrepreneurs have to find a way to pick their interest on these issues in a careful manner, and to set up an appropriate mechanism for various stakeholders to be involved in CSI process. In particular, in order to decrease their “exclusiveness”, it’s important for them to create coexisting situations with a diversity of legitimacy in the mechanism.
Table 2 shows what legitimacy factors and exclusiveness in these social innovations are. As mentioned before, social entrepreneurs have their own unique motivations and reasons for implementing the social innovation. In the case of the Yamato Group, they wanted to reaffirm the importance of their management philosophy in the initial stage. In the case of the Yamaha Co. and Yamaha Motor, Slow Label wanted to create and use the wheelchairs that play music for their performances. For both of them, these were their unique and exclusive reasons. We understand that these social entrepreneurs made a persistent effort to create legitimacy creatively and flexibly, and to decrease these unique and exclusive reasons in the process. In some ways, these social entrepreneurs also engaged in “bricolage behavior”, which concept is inherently tied to notions of creativity and improvisation. As Baker and Nelson (2005) redefined Levi-Strauss’s work, the concept of entrepreneurial bricolage focuses on using existing resources at hand, and making do to provide breakthrough solutions in the creation of a firm.
| Cases | Legitimacy Factors | Exclusiveness in Corporate Social Innovation (their own reasons) | ||||
|---|---|---|---|---|---|---|
| 1 | 2 | 3 | 4 | |||
| Yamato Group | Donation of 10 Yen per TA-Q-BIN Parcel Delivered | A sense of crisis in society caused by the earthquake (key role of decreasing exclusiveness in social innovation) | Corporate culture/Corporate social mission: We all represent the company | Yamato Group’s awareness of CSR activities before the earthquake | External Supporters | Yamato wants to reaffirm the importance of their management philosophy. (to help enrich our society by enhancing the social infrastructure of TA-Q-BIN networks). Yamato wants to donate the full amount to the disaster regions without paying taxes. |
| Yamaha Corporation and Yamaha Motor | &Y 01 (electrically power-assisted wheelchair that plays music) | The advertising effectiveness at Tokyo 2020 Paralympic Games (key role of decreasing exclusiveness in social innovation) | Corporate philosophy in common: sharing new Kando* and rich culture with as many people as possible. | Point of view placing emphasis on technology | Social Catalyst | SLOW LABEL wants to create and use the electrically power-assisted wheelchairs that play music for their performances. |
* Kando is a Japanese word for the simultaneous feelings of deep satisfaction and intense excitement that we experience when we encounter something of exceptional value.
This study which focuses on resource mobilization, complements other studies, that focus on knowledge creation. As Takeishi et al. (2010) already pointed out, the two aspects interact with each other. Therefore, the way resources are mobilized affects the way knowledge is created and the knowledge created enables the mobilization of new resources. To better understand the corporate social innovation process, we should undertake research on examining these two aspects in an integrated manner.
This exploratory study had several limitations that call for further research. First, this paper only focuses on CSI initiatives on two Japanese companies. This limited sample reduces the generalizability of the findings. It is recommended that more companies or industries in Japan should be researched in the future in order to get comparative data on the related issues.
Another possible limitation on this study is that the concepts of “social innovation” and “corporate social innovation”, from which this study draws, remain at the developmental stage. Future studies could lay the groundwork for more comparative studies on social innovation processes and CSI processes in a global context.
This research was partially supported by the Ministry of Education, Culture, Sports, Science, and Technology, Grant-in-Aid for Scientific Research (C), 2018–2020 (18K01809, Masaatsu Doi). This is also a product of research that was financially supported by the JFBS Research Grant Program 2017–2018.
