The Web-Based Accountability Practices in Social Enterprises: Validating the Stakeholder Theory

Abstract

In the absence of shareholders, accountability practices in social enterprises are determined by the strengths of stakeholders. The stakeholder theory postulates that accountability systems depend greatly on the power and number of stakeholders. With the advent of technologies, it is increasingly common to use internet-based technologies in addressing accountability in social enterprises as they pursue hybrid objectives which attempts to balance off both social and economic missions. In view of this, the present study aims to validate the stakeholder theory, focusing on the effect of web-based accountability practices in social enterprises. Based on the Social Enterprise Alliance (SEA) database, all the social enterprises in the database were selected after controlling the type of formation for each social enterprise. The three dimensions of web-based accountability practices showed a low disclosure level on the extent of web-based accountability practices incorporating the three dimensions of finance, performance and political accountability. The results also revealed that social enterprises have less interest in disclosing their financial accountability practices through web sites.