Managing Paradox for the Sustainability of Social Enterprises: An Empirical Study of Forestry Community Cooperatives in Indonesia

Social enterprises (SEs) have a paradoxical nature in serving economic and social objectives and meeting them is essential in managing SEs effectively. This study surveys 561 senior executives of 189 forestry cooperatives in Indonesia to assess whether these SE leaders demonstrate such behaviours and to establish their origins. Results demonstrate that the need for cognition and environmental complexity determine the cognitive complexity of SE leaders and environmental complexity is more dominant than the need for cognition. This indicates that cognitive complexity is externally rather than internally driven and that leaders’ commercial and pro-social behaviours raise sustainability of their cooperatives. Cognitive complexity instigates both behaviours.