To reform or preserve? Responsible leadership in community-oriented small businesses

In contemporary entrepreneurship, leadership advances both internal and external stakeholders’ interests while safeguarding the broader interests of humanity and the planet. Responsible leadership (RL) considers both the shareholders and external communities. This study focuses on implementation of RL in small for-profit businesses that exhibit a commitment to community engagement. We analyse the value-driven purposes that small business managers pursue through RL, the communities in which they exercise leadership to promote desired change, and which RL roles they apply. Five managers of small businesses located in rural or small Finnish towns were purposefully selected for this multiple case study ensuring a representation of diverse small businesses that actively articulate their objectives in relation to their communities. Each enterprise exemplifies a distinct RL approach within a two-dimensional matrix: physical proximity (or distance) to their target community and level of reformation (or preservation) of their purpose. As the output, we propose a novel, empirically validated four-field typology for RL approaches: local reformers, local preservers, global reformers, and global preservers. Additionally, we present an adapted version of the three-role RL model adapted to small businesses. Notable modifications include the division of the original facilitator role into formal and informal employers and the incorporation of the four RL approaches under the citizen role. The novelty lies in a nuanced description of RL with regards to the community, purpose, and roles in the context of small businesses.