On the Compatibility of Benevolence and Self-Interest : Philanthropy and Entrepreneurial Orientation

This study contributes to emerging research on entrepreneurial philanthropy. It explores the philanthropy of owner-managers of small and medium-sized enterprises (SMEs) and investigates whether and why more entrepreneurially oriented (EO) SMEs are also more likely to be philanthropic. We find support for a positive link between EO and philanthropy in a representative sample of 270 Lithuanian SMEs controlling for alternative explanations. We highlight that philanthropy is relatively common amongst SME owner-managers, and thus complement existing research, which views philanthropy as sequentially following wealth generation. In line with our theorizing, further qualitative findings point to drivers of philanthropy beyond those considered in the dominant strategic-instrumental perspective. Building on social psychological theories of motivation, we argue and find that philanthropy can also be an expression of owner-managers altruistic values, and that these values can be compatible and even mutually-reinforcing with entrepreneurship. Our study is set in a transition economy, Lithuania, facilitating the analysis of heterogeneity in attitudes towards philanthropy