Stakeholder role in overcoming trade-offs between economic and ecological objectives in eco-entrepreneurship

Abstract

Although capitalism has, for centuries, largely ignored its environmental impact, in recent years these have come to the fore of academic and policy discourse around the world. This has largely been driven by wide-reaching environmental effects such as global warming, droughts and vital species extinction. These effects have been linked to significant financial losses which fuelled the need to resolve the environmental challenges. Since entrepreneurship is the engine of capitalism, many of these challenges are resultant of entrepreneurial decisions. In seeking solutions to resolving these issues, the world has turned to entrepreneurs once more to find innovative ways of managing these challenges. Eco-entrepreneurship, a form of entrepreneurship that focuses on reducing environmental degradation, has been viewed as a vehicle to resolve these challenges. However, due to the recency of these suppositions, no sufficient studies are focusing on investigating eco-entrepreneurship. Moreover, several studies have shown eco-entrepreneurship to be inherently characterised by trade-offs between their economic and ecological dimensions. This study supposed, supported by other researchers, that for eco-entrepreneurs to thrive, they must balance these trade-offs. Due to its premise of collaboration among different stakeholders, stakeholder theory was used as a lens through which this study was undertaken. In seeking to provide insights around this question, an explorative phenomenological research approach was used. Non-probability sampling was used along with semi-structured interviews to gather the necessary data. This study found that the role of stakeholders (stakeholders such as governments, institutions and society) in eco-entrepreneurship is the creation of a market within which eco-entrepreneurs can operate. Through regulations, communication, trust, the establishment of common interests and their incorporation into strategy, it was found that eco-entrepreneurs can balance the ecological and economic goals trade-offs.