Conflicts between core purposes: Trade-offs associated with organizational shifts in Mexican community forest enterprises. (December 2022)

• Record Type: Journal Article
• Authors: Engbring, Gretchen; Hajjar, Reem
• Is Part Of: World development. Volume 160(2022)
• Publication Date: 2022-12
• Subjects: Common-pool resource management -- Collective ownership -- Social effectiveness -- Social enterprise -- Social firm -- Smallholder forestry; Economic history -- 1990- -- Periodicals; Economic assistance -- Developing countries -- Periodicals; 330.9
• DOI: 10.1016/j.worlddev.2022.106078
• Languages: English
• ISSNs: 0305-750X

Abstract

Highlights: Oaxacan community forest enterprises face trade-offs between their social performance and more profit-oriented aims. Organizational features adopted to increase profit often hurt aspects of social performance such as trust and participation. Communities actively navigated and, in some cases, mitigated trade-offs between their social and financial performance. The trade-offs we found among community forest enterprises can also be found among other forms of social enterprise. Acknowledging trade-offs allows communities to better weigh and respond to the consequences of organizational changes. Abstract: Community forest enterprises (CFEs) have been promoted globally in conservation and rural development initiatives. CFEs, which are considered social firms, commercialize various forest products and services to provide income, employment, public goods, and services. However, as with other social firms, CFEs may experience a tension between generating revenue and fulfilling their social mission. We explored this tension through a qualitative case study that examined the organizational choices of four CFEs in Oaxaca, Mexico, including the processes and practices they adopted that prioritized their social mission or more profit-oriented aims, and the way they navigated the tensions between their social and financial goals. Interviews revealed that the different organizational features of CFEs, including leadership structures, decision-making processes, enterprise locations, and benefit-distribution schemes, often elevated CFEs' social mission or more profit-oriented aims, typically at the cost of the other. With some exceptions, we found that the organizational processes and practices CFEs adopted to generate more revenue often negatively impacted trust, transparency, and participation. We build on scholarship that has documented tensions between historical communal governance and enterprise management in Mexico by demonstrating how communities are modifying their organizational structures in ways that blur the lines between traditional governance and enterprise management and, in some cases, in ways that mitigate trade-offs. Better understanding organization and associated trade-offs may allow CFEs–or other stakeholders interested in their proliferation and success–to make more transparent and deliberate decisions and avoid or adapt to undesirable outcomes and unanticipated consequences. As CFEs are promoted and replicated globally, our study is an important step in understanding the perverse outcomes and unintended feedbacks that arise from enterprise organization and illustrates the tension between social and financial performance in CFEs.