Stakeholder Management and Mission Drift: A Conceptual Structure for Juggling Business and Social Goals

Abstract

In today's world, financial sustainability is a big challenge for contemporary organisations to achieve alongside social and societal goals. This tension exists especially for social enterprises and hybrid organizations where there are competing stakeholder expectations which may shape organizational priorities and resource allocation. This paper conceptualizes the stakeholder management and the phenomenon of mission drift and provides a conceptual framework to explore them. The study is based on theoretical and conceptual insights, which incorporate theories and concepts of stakeholder interests, stakeholder power, resource dependence, institutional pressures, organizational governance, and competing organizational logics. The analysis suggests that mission drift is not inevitable in the process of commercialisation, but can occur when powerful commercial actors have a greater influence than others on strategic decision-making, performance measurement and allocation of resources. Meanwhile, social stakeholders can play a part in mission preservation if their interests are taken into account, in a meaningful way, as part of governance and accountability practices. The paper suggests that business–social balancing is an organizational ability that can be developed continuously with the involvement of stakeholders, the diversification of resources, the integration of performance measurement, management and leadership based on mission and clear governance. The resulting framework characterizes the process of mission alignment as a dynamic product of organizational mechanisms that buffer and negotiate conflicting stakeholder demands while maintaining financial viability and substantive social purpose.