Founders of the Future, A Succession for Success? The Role of Organizational Identification on Founder-CEO Succession in Social Enterprises

Abstract: With the world facing increasing global challenges, an important contributor to solving those comes from social enterprises. A prerequisite for those types of companies to have a positive impact within our existing economic system is to be successful. A factor that has shown to be crucial in the success story of traditional enterprises is the Founder-CEO succession and specifically Founder-CEOs receding too late because of large personal attachment to their creation, stumping the success potential. By studying the reasons and enabling factors of this event in social enterprises specifically, we wish to gain insight about possible differences in enabling factors of Founder-CEO successions in social enterprises versus traditional ones. By conducting a qualitative multi-case study of 16 semi-structured interviews with Founder-CEOs, new CEOs and chairmen of seven social enterprises, that have gone through a voluntary succession, this thesis aims at understanding how the primacy of the social mission affects the decisions preceding a Founder-CEO succession in a social enterprise using a combined model of Organizational Identification and Prosocial Behavior theory. Previous research states that a high level of Organizational Identification leads to Founder-CEOs clinging on to their position for too long and Prosocial Behavior leads to even higher Organizational Identification which should make the Founder-CEOs of social enterprises even less prone to recede. However, our findings indicate that there is a larger willingness for Founder-CEOs in social enterprises specifically to recede because of a stronger identification with the mission of behaving prosocially rather than their identification with the organization per se. We argue that these findings are contributing to the understanding on what social enterprises need to do to succeed.