When for-profits run commons

Consciousness regarding human impacts on the planet, as well as on issues related to social exclusion and poverty, has increased rapidly in recent decades. To make the world more sustainable, various types of initiative have emerged, including on markets. In this conceptual paper, the focus is on commons-governing companies: Shareholder-owned for- profit mission driven alternative business models active on markets, which favor social outcomes along with profit in their bylaws and govern common goods. This paper aims to assess under which circumstances new mission-driven alternative business models can govern new commons and, by doing so, become commons-governing companies. Combining institutional theory with theories from psychology and economy, we develop an interdisciplinary approach to the commons. We propose three management principles applicable to commons-governing companies. They are based on the commons-governing companies’ rules-in-use, as well as on the characteristics of the individuals active at each level of rulemaking and the social norms they convey. Some of these principles have been analyzed in the scholarly literature on hybrid organizational models. However, the analysis in this paper shows that business activities related to governing the commons require stronger involvement in some hybrid practices. In particular, these companies need to be strongly involved in organizing various forms of collective action with their internal or external stakeholders when contributing to the provision and maintenance of the commons. We therefore argue that commons-governing companies evolve in a strongly nested environment, as a specific condition for effective governance of these companies.