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Social Entrepreneurship and ESG: Challenges and Opportunities

Authors

Dr Seema Devi

Assistant Professor, Dept of Commerce C. D. R. J. M., Butana, Sonipat, Haryana (India)

Dr Menka

Assistant Professor, Dept of Commerce C. D. R. J. M., Butana, Sonipat, Haryana (India)

Article Information

DOI: 10.47772/IJRISS.2026.10190015

Subject Category: Entrepreneurship

Volume/Issue: 10/19 | Page No: 181-198

Publication Timeline

Submitted: 2026-01-20

Accepted: 2026-01-26

Published: 2026-02-14

Abstract

The present study examines the application of Environmental, Social, and Governance (ESG) practices by social companies to achieve sustainable growth through transparency, attract blended finance, and support mission-driven governance. It demonstrates how three primary elements influence the adoption of ESG: the enterprise's resources (Resources), the trust and expectations of stakeholders (Stakeholders), and laws and regulations (Institutions). These elements present potential for increasing credibility, attracting new investments, loyalty and attaining global goals. Still, they can also pose obstacles, such as ambiguous policies, a lack of funding, challenges in quantifying impact, resources constraints. To demonstrate how ESG can support social companies in meeting compliance requirements while also enhancing their mission and longterm performance, the study integrates concepts from various theories, including Institutional Theory, Stakeholder Theory, and the Resource-Based View Theory (RBV). The paper concludes that ESG adoption is more than a reporting requirement. It is a strategic tool for social enterprises to stand out, build trust, and contribute to inclusive development. Recommendations are provided for entrepreneurs, investors, and policymakers to facilitate the adoption of ESG and enhance its effectiveness. Some suggestions are also provided for future research, which should test this framework with real-world data and compare results across countries to deepen the understanding.

Keywords

ESG adoption, Social entrepreneurship, Resilience, Institutional theory, Stakeholder theory, Resource-Based View (RBV)

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