The commercialisation of microfinance: deploying management control to address institutional complexity

IF 3.2 Q1 BUSINESS, FINANCE Journal of Accounting in Emerging Economies Pub Date : 2024-05-28 DOI:10.1108/jaee-02-2023-0049
A.Z. Siti Nazariah, A.K. Siti-Nabiha, Zubir Azhar
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Abstract

Purpose

The study aimed to examine the transformation of a non-profit microfinance institution (MFI) into a hybrid social enterprise, and the role of formal and informal controls in reconciling the discordance between the two conflicting (social and commercial) objectives that emerged due to the transformation.

Design/methodology/approach

A case study of a non-governmental MFI located in Southeast Asian country was conducted. This case study drew on the institutional logics perspective as an analytical tool to understand the complexity of change and the mobilisation of management control practices to align two conflicting goals at the core of the MFI’s organisational strategies. This study adopted the interpretive approach and relied on multiple data sources, including semi-structured interviews and documentary evidence.

Findings

The application of commercial principles in the operations of the MFI occurred in several phases. First, the MFI changed from a non-profit business model to a hybrid social enterprise, which pursued a double bottom-line strategy. The informal control practices inherent in the organisation’s culture created a high level of social awareness embedded within a social logic. In contrast, the formal control practices were directly linked to the new commercial logic. The synergy between the two logics was optimised by reinforcing formal and informal control practices.

Originality/value

This study offers insights into the role of control systems in reconciling the discordance between competing social and financial objectives within a non-governmental MFI that enjoys substantial financial and nonfinancial support from the government.

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小额信贷的商业化:利用管理控制解决机构复杂性问题
本研究旨在探讨一家非营利性小额信贷机构(MFI)向混合型社会企业转型的过程,以及正式和非正式控制措施在协调转型过程中出现的两个相互冲突(社会和商业)的目标之间的不和谐方面所发挥的作用。本案例研究采用制度逻辑视角作为分析工具,以了解变革的复杂性,以及如何调动管理控制实践,以协调小额金融机构组织战略核心的两个相互冲突的目标。本研究采用了解释性方法,并依赖于多种数据来源,包括半结构化访谈和文件证据。首先,小额供资机构从非营利商业模式转变为混合型社会企业,追求双重底线战略。组织文化中固有的非正式控制做法在社会逻辑中形成了高度的社会意识。与此相反,正式的控制做法与新的商业逻辑直接相关。通过加强正式和非正式控制实践,优化了两种逻辑之间的协同作用。原创性/价值这项研究深入探讨了控制系统在调和非政府小额供资机构内相互竞争的社会和财务目标之间的不协调方面所起的作用,该机构享有政府提供的大量财政和非财政支持。
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来源期刊
CiteScore
5.80
自引率
13.00%
发文量
38
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