Winner, Best Paper, United States Assoc. for Small Business & Entrepreneurship, usasbe.org Philadelphia 2017. Abstract: Entrepreneurial activity may be inconsistent with the need to conserve the planet and prevent environmental damage. This article provides the theoretical basis for Biosphere Entrepreneurship, which goes beyond business and social entrepreneurship. It theoretically justifies entrepreneurial activity that adds value to Earth. Extending the work of Kuratko, Morris, and Schindehutte on ontological frameworks (2000; 2001; 2015), we combine entrepreneurship, climate change economics, and sustainability research in an attempt to build a theoretical base for biosphere entrepreneurship. In the Implications, we ask, what can educators do to help biosphere entrepreneurs address the existential and catastrophic risks facing humanity?
Executive Summary: This article combines entrepreneurship research with climate economics and sustainability to build a new theory of biosphere entrepreneurship. Going beyond business and social entrepreneurship, which add value to private and community domains, respectively, biosphere entrepreneurship is entrepreneurial activity that adds value to the biosphere and ecosystem services.
The purpose of this article is to devise mental models (frameworks) relating entrepreneurship and climate change to facilitate theory-building. Using images and visual depictions, the article envisions a theoretical model of entrepreneurial ecology or biosphere entrepreneurship showing how the Earth, humanity, and the economy are connected through negative entrepreneurship and positive entrepreneurship. It extends extant frameworks-- entrepreneurial risk and survival frameworks; financial and capital frameworks; entrepreneurial growth frameworks; business model frameworks; socio-cultural frameworks; and entrepreneurial opportunity frameworks—to theoretically justify entrepreneurial activity that adds value to Earth.
The article uses entrepreneurship ontology in the tradition of Kuratko, Morris, and Schindehutte (2000; 2001; 2015) to describe phenomena in a way to identify and classify concepts and relationships about which increasingly are reaching consensus. The purpose is to use ontological framework analysis to convert abstraction into order, prioritize variables, and identify relationships within a new field of biosphere entrepreneurship. We seek candidate frameworks combining the domains of entrepreneurship, climate economics, and sustainability to expand a theory of biosphere entrepreneurship.
The article concludes with implications for entrepreneurship education. If biosphere truly go beyond business entrepreneurs seeking private gain, and social entrepreneurs adding value to social communities, what are educators doing to help our young entrepreneurs see climate change as market failure, identify market opportunities, and come to grips with existential and catastrophic risk?
Understanding Biosphere Entrepreneurship Through a Framework Approach
1. “Some entrepreneurs decide to act in ways that
result in harm to the natural environment . . .
perceive[ing] opportunities that harm the
environment as highly attractive”.
Shepherd et al. (2013, p. 1251) “
Understanding Biosphere
Entrepreneurship through a
Framework Approach
Dr HH Frederick S., Research Professor
Tecnológico de Monterrey, Puebla México
hfrederick@itesm.mx
2. Background
• Professor at Monterrey
Institute of Technology,
Mexico’s MIT
• Author of 200+ papers and
widely used textbooks in
the Asia-Pacific region.
Spanish version.
3. Extending the work of Kuratko, Morris, Schindehutte
on entrepreneurship ontology
• Combines frameworks from entrepreneurship, climate change
economics, and sustainability to build a model of biosphere
entrepreneurship
• Extends extant frameworks to theoretically justify entrepreneurial
activity that adds value to Earth.
• How the Earth, humanity, and economy are connected through
negative and positive entrepreneurship.
• Kuratko, D. F., Morris, M. H., & Schindehutte, M. (2015). Understanding the
dynamics of entrepreneurship through framework approaches. Small Business
Economics, 45, 1–13.
• Morris, M. H., Kuratko, D. F., & Schindehutte, M. (2001). Towards integration:
understanding entrepreneurship through frameworks. The International Journal of
Entrepreneurship and Innovation, 2, 35–49.
• Morris, M. H., Kuratko, D. F., & Schindehutte, M. (2001). Understanding
entrepreneurship through frameworks. The International Journal of Entrepreneurship
and Innovation, 2, 35–49.
What is ontology?
4. Defining
biosphere entrepreneurship
• Definition comes from three “enterprise orientations”.
– Entrepreneur economicus seeks to add value to the private purse
– Entrepreneur sociologicus seeks to add value to the community and
society
– Entrepreneur naturalis adds value to the biosphere and ecosystem
services.
• Key characteristics of biosphere entrepreneurship:
– adding value to the biosphere rather than extracting resources from it
– improving human well-being while safeguarding natural ecosystems
– utilizing biosphere resources and returning them to nature
– balancing the relationship between humans and nature
– promoting resilience (ability of the planet to recover)
– solving problems related to the biosphere and to sustainability
– putting profits into generation/regeneration of ecosystem services
Bergstrand, Björk, & Molnar, 2011; Björk, 2011; Björk & Olsson, 2013; Fry, 2013; Swedish Ministry of Environment,
2014, pp. 75, 102).
5. Research questions
about theoretical frameworks
• Kuratko et al. (2015, p. 3): “New opportunities for entrepreneurship
theory . . . will be based on both expanding the contexts of
entrepreneurship as well as a deepening of the existing theoretical
approaches”.
– Is there a third kind of entrepreneurship beyond business and social
entrepreneurship?
– Can we envision a “framework of frameworks” that ties together disparate
threads, each of which explains a portion of the phenomenon?
• The purpose of this paper is to present candidate frameworks that suggest
the emergence biosphere entrepreneurship theory.
• This will help us describe and analyze entrepreneurs who choose climate-
resilient pathways that add value to the biosphere.
8. Financial/capital
frameworks
• Researchers now refer to entrepreneurial
capitals much more expansively.
• Five Capitals Framework sees five types of
capital arising from three ‘spheres’ of
human activity
– The econosphere yields both financial capital and
manufacturing capital.
– The sociosphere yields Human capital and Social
capital.
– The biosphere yields natural capital.
• Natural capital supplies entrepreneurs with
ecosystem services ranging from minerals
and trees, to waste recycling, carbon sinks,
water supply, and erosion control.
9. • Drawing upon Kondratieff (1922),
Schumpeter (1939)
• The disruptive entrepreneur
accelerated creative destruction
allowing the economy to renew itself
and bound onwards and upwards
again.
• [] Let’s make one small change. We
simply re-label the Y-axis. Schumpeter
called it “Innovation”; here we change
it to “Stress on Earth’s carry capacity”,
and make no other changes.
• We see that each industrial cycle
increases the burden of stresses on
Earth’s carrying capacity and results in
a ‘peak curve’ followed by demise and
destruction.
Growth frameworks
10. • The “de-growth” framework confronts
traditional ideas of incessant growth,
consumerism and capitalism.
• De-growth is defined as
• an equitable downscaling of
production and consumption to
increase human well-being and
enhances ecological conditions.
• McDonough & Braungart’s
entrepreneurial de-growth framework
challenges entrepreneurs to envision a
world without waste, a world without
poisons, and a world in which all
materials are continuously
recycled/upcycled from the economy in
and out of the biosphere.
De-Growth frameworks
11. Socio-cultural frameworks / Altruism
Are there are socio-cultural
factors that influence the
emergence of biosphere
entrepreneurs?
• Egocentric entrepreneurs
take advantage of Earth’s
resources thus exploiting the
environment with impunity.
• Conspecific entrepreneurs
move beyond self-interest to
create value for co-species and
the broader community.
• Biosphere entrepreneurs go
beyond individual self-interest
and even community benefit
to add value to species and
ecosystems.
12. • Previous frameworks –
1. Cantillon’s competition
opportunity
2. Schumpeter’s
innovation opportunity
3. Kirzner’s alertness
opportunity
• Merge into the
biosphere opportunity
framework.
• Entrepreneurial
biosphere opportunity
space are where
entrepreneurs identify
opportunities to create
value for a more
resilient planet.
Spaces for biosphere entrepreneurship opportunity
Entrepreneurial opportunity
13. Increasing demand
Demand for resources and eco-system
services
Declining supply
Resources and ecosystem services
Sustainable supply
Sustainable demand
Sustainable
future
Margin for action
is narrowing
The present The future
Entrepreneurial opportunity
14. Biosphere
Sociosphere
Econosphere
• Ecocentric
• Re-growth
• Existential risk
• Natural capital
• Resilience space
• Conspecific
• De-growth
• Catastrophic risk
• Social capital
• Socio-cultural factors
• Egocentric
• Unrestrainted growth
• Personal risk
• Economic capital
• Risk and survival
(+)
(-)
FrameworksSpheres of activityEntrepreneurial actions
Resource
extraction
Positive
entrepre-
neurship
Negative
entrepre-
neurship
(O)
15. Negative and positive entrepreneurship
Industrial entrepreneurship 1800-2000
• Entrepreneurs undervalue biodiversity, energy,
water, and materials.
• Rather than adding value to living materials we
only aim to reduce (e.g. through recycling) the
quantity of dead resources.
• In the end, society penalises entrepreneurs
through regulation.
• Did not consider environment in planning and
design.
• Focused on extraction of resources
• Did not prevent negative effects
• Entrepreneurs had a negative impact on the
environment and society.
Sustainable entrepreneurship from 2000+
• Focus on biosphere and limiting waste
embodied in products.
• Take into account the living dimension of the
products and services that we produce.
• Create net positive entrepreneurial impact loops
• Generates positive value-adding impacts
• Eliminate waste, duplication, and planned
obsolescence.
• Creates net positive-impact loop systems and
innovations that create levers for biophysical
improvements and social transformation.
16. What have we accomplished here?
• We have sorted observations into categories, extended frameworks,
and envisioned a model that ties threads together.
• We have been satisfied Kuratko et al. by expanding the context into the
biosphere.
• There is a third kind of entrepreneurship beyond business and
social entrepreneurship.
• We have depicted a theoretical model of biosphere entrepreneurship
showing how Earth, people and entrepreneurship are connected.
• Further research must take this pre-paradigmatic framework forward
towards a theoretical re-structuring of the field.
• This new frame will help researchers describe and analyze
entrepreneurship that chooses climate-resilient pathways that add
value to the biosphere.
17. • “Entrepreneurship as if the
planet mattered”.
• Every chapter in the book
– from performance
measures to marketing,
from strategy to start-up,
from ethics to family
business – is related the
sustainability and the
environment.
Implications for
entrepreneurship
education
18. Implications for entrepreneurship education
• Basics: Economic growth and entrepreneurial activity are
inextricably linked to global warming.
• Climate change economics: Market failures motivate
environmentally degrading behavior.
• Environmental crime. The most morally questionable
entrepreneurs are environmental crime enterprises.
• Innovation: The green energy revolution is going to be
carried by engineers and entrepreneurs.
• Family business: Climate change and global warming are
affecting the fortunes and longevity of family businesses.
• Social intrapreneurship: Social intrapreneurs
demonstrate that business and social values can be
aligned.
• Entrepreneurial marketing: Recyclability, re-usability,
biodegradation, and positive health effects are definitely in.
• Strategy and sustainable development: Entrepreneurial
strategy involves the art of managing assets that one does
not own such as the Earth.
• Legal framework: Companies are today increasingly
subject to regulations and standards in key markets.
• Sustainability performance measures for entrepreneurs:
Climate change has suddenly exploded onto the agenda of
financial disclosure statements around the globe.
• Sustainable business planning: We have to change our
business models to respond to sustainability issues.