The Absence of Integrity-Based Entrepreneurial Orientation: A Study on Stagnant Social Performance in Innovative Organizations in Indonesia
Keywords:
Keywords: absence of integrity; entrepreneurial orientation; ethical entrepreneurial orientation; social performance; organizational cultureAbstract
This study examines the conceptual gap between entrepreneurial orientation (EO) and the social performance of innovative organizations in Indonesia. Although the existing literature consistently links EO, which includes innovativeness, risk taking, and proactiveness, with innovation and financial outcomes, its relationship with social performance remains underdeveloped both empirically and theoretically. Based on the premise that the absence of an integrity based ethical dimension within the conventional EO framework represents a structural deficiency, this study develops and tests the construct of Ethical Entrepreneurial Orientation (EEO), which integrates integrity and ethical values into the traditional EO dimensions. Using a quantitative research design and component based structural equation modeling (PLS-SEM) applied to data from 287 managers of innovative organizations across Indonesia, the findings indicate that EO without an ethical foundation is significantly associated with stagnant social performance, even when innovation outcomes remain high. Specifically, the EEO dimension functions as a mediating mechanism linking entrepreneurial behavior to social performance. This study contributes a novel conceptual construct, namely EEO, to the innovation management literature and provides an empirical foundation for integrating ethics into the entrepreneurial framework. Implications for theory, managerial practice, and policy in the context of emerging markets are also discussed.
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