Page 247 - Social Enterprise A New Business Paradigm for Thailand

Molteni (2019) emphasizes the strategic role of spin-offs, noting that they are supported by the
parent organization to serve as market pioneers, often entering new spaces ahead of
competitors. These entities typically have focused goals, such as delivering fresher products and

services, while also enhancing the parent company’s strategic agility.

DePamphilis (2021) offers a broader perspective, suggesting that spin-offs may vary in their
structural ties to the parent company. They may operate as subsidiaries, be partially or wholly
owned, or function independently, with or without managerial involvement from the parent. In
some cases, they remit dividends to the parent or are established to gain tax advantages.
Stowell (2018) adds that spin-offs can also act as formal separation mechanisms to reduce
potential conflicts of interest, while still benefiting from the oversight and support of the parent
organization.

Building on the definitions and interpretations above, this study broadly defines a spin-off in
the context of social enterprises as: “a social enterprise established by a parent organization

that, while operating independently, continues to rely on the parent and its network for various
forms of support, such as funding, business model development, and the sharing of resources,
knowledge, personnel, and technology. This also includes the transfer of donations through the
parent organization when it operates as a public charity foundation, allowing donors to claim
tax deductions.”

Within the spin-off category, two distinct subgroups can be identified based on the nature of
support they receive: (1) the flexibly supported group and (2) the Pracharath Rak Samakkee
group (see Chapter 7 for details).

3.2) Industry

Hussain, Ahmad, and Mia (2023) found that the financial performance of social enterprises
varies across industries. Specifically, (1) in the financial sector, the debt ratio, total asset growth
rate, and dividend yield positively influence operational performance, while (2) in the service
sector, return on equity (ROE) and return on assets (ROA) have a similarly positive effect. Bae
(2015) further observed that social enterprises in the fields of arts and culture, human rights,
and economic development tend to generate lower economic and social value, whereas those

in education, environmental conservation, and public health tend to create greater value in
both dimensions.

8.2 Research Methodology

This chapter aims to examine the financial status of social enterprises in Thailand, with a
particular emphasis on financial performance. The research methodology is summarized in
Figure 8.2, followed by a discussion of several key aspects of the study’s design.

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