Abstract
Organizations that attempt to combine different institutional logics into one mission (i.e. hybrid organizations) have attracted considerable scholarly and policy interest (Varendh-Mansson et al., 2020). These organizations aim to solve social problems (social/development logic) through a market-based approach (market logic) (Battilana et al., 2014). However, combining categorical and often competing logics proves difficult for most hybrids (Cappellaro et al., 2020). Advances in the literature have lately suggested that interorganizational collaborations are key to hybrids’ successful embodiment of multiple and competing institutional logics because they can support organizational fields’ receptivity to logics blend (Huybrechts and Haugh, 2018; Nicholls and Huybrechts, 2016; Savarese et al., 2020). Nonetheless, empirical research that tests such proposition is still scarce.
We explore these gaps by reconstructing a two-mode network of interorganizational collaborations established between microfinance institutions (MFIs), a notable example of hybrid organizations, and other institutional actors operating in Mexico over the financial year 2015 . We focused our attention on the Mexican microfinance sector because, over the years, Mexican MFIs have been supported with their social and market-based objectives through sustainable growth interventions, commercialization of their capital structure, professionalization of their practices and financial and responsible lending monitoring (Kleynjans and Hudon, 2016). These interventions have been promoted through interorganizational collaborations established between MFIs and actors including government, development finance organizations, investors, donors, rating and audit agencies and technical assistance institutions.
We estimated our two-mode network through Exponential Random Graphs Models (ERGMs) to explore whether interorganizational collaborations can support organizational fields’ receptivity to multiple logics (social and market logics) and, thus, hybrids’ potential to fulfil a combination of such logics into one mission. We did this by testing our networks against organization-level predictors of networking behaviour (organizations’ objectives and MFIs’ social and financial performances) and endogenous structural terms (i.e., relational mechanisms) explaining how such behaviour is distributed across field-level collaborations.
We found that collaborations in the Mexican microfinance sector are characterized by power dynamics and social selection mechanisms that favour a few particularly profitable and already well-sourced MFIs. More precisely, we find that only a few financially efficient MFIs can diversify financial and capacity building resources, and they do this by attracting similar key collaborators. Conversely, these effects do not apply to MFIs that are particularly socially performant. More broadly, our findings suggest that interorganizational collaborations may not necessarily support organizational fields’ receptivity to multiple and competing institutional logics. This can have negative impacts on hybrids’ ability to solve social problems while pursuing commercial interests. The implications of our findings are discussed in terms of research, policy and practice.
We explore these gaps by reconstructing a two-mode network of interorganizational collaborations established between microfinance institutions (MFIs), a notable example of hybrid organizations, and other institutional actors operating in Mexico over the financial year 2015 . We focused our attention on the Mexican microfinance sector because, over the years, Mexican MFIs have been supported with their social and market-based objectives through sustainable growth interventions, commercialization of their capital structure, professionalization of their practices and financial and responsible lending monitoring (Kleynjans and Hudon, 2016). These interventions have been promoted through interorganizational collaborations established between MFIs and actors including government, development finance organizations, investors, donors, rating and audit agencies and technical assistance institutions.
We estimated our two-mode network through Exponential Random Graphs Models (ERGMs) to explore whether interorganizational collaborations can support organizational fields’ receptivity to multiple logics (social and market logics) and, thus, hybrids’ potential to fulfil a combination of such logics into one mission. We did this by testing our networks against organization-level predictors of networking behaviour (organizations’ objectives and MFIs’ social and financial performances) and endogenous structural terms (i.e., relational mechanisms) explaining how such behaviour is distributed across field-level collaborations.
We found that collaborations in the Mexican microfinance sector are characterized by power dynamics and social selection mechanisms that favour a few particularly profitable and already well-sourced MFIs. More precisely, we find that only a few financially efficient MFIs can diversify financial and capacity building resources, and they do this by attracting similar key collaborators. Conversely, these effects do not apply to MFIs that are particularly socially performant. More broadly, our findings suggest that interorganizational collaborations may not necessarily support organizational fields’ receptivity to multiple and competing institutional logics. This can have negative impacts on hybrids’ ability to solve social problems while pursuing commercial interests. The implications of our findings are discussed in terms of research, policy and practice.