Social Innovation in Entrepreneurship: A Strategic Pathway to Poverty Reduction for Sustainable Development: A systematic Literature Review

Social Innovation in Entrepreneurship: A Strategic Pathway to Poverty Reduction for Sustainable Development: A systematic Literature Review Tom Ongesa Nyamboga (PhD)1 1. Lecturer School of Business and Management, Kampala International University, Western Campus; [email protected] *Corresponding Author Email: Tom Ongesa Nyamboga Kampala International University Uganda: [email protected] ORCID: https://orcid.org/0009-0004-7073-8219 Abstract This review looks at how social innovation plays a role in entrepreneurship as a way to fight poverty and encourage sustainable development. While entrepreneurship has long been seen as a key driver of economic growth, there has been little focus on its link with social innovation. Specifically, more attention is needed on how it can address economic, social, and environmental challenges in a comprehensive way. This gap in the literature shows the need to better understand how entrepreneurial practices, when paired with social innovation, can create value beyond just financial success. The study is anchored on Diffusion of Innovations Theory, which provides a framework for understanding how novel entrepreneurial solutions are adopted and scaled within communities. To address this, the review applies a systematic literature review approach guided by PRISMA protocols. Empirical studies, reports, and peer-reviewed journal articles published between 2019 and 2025 were identified and thematically analysed to capture how social innovation is integrated into entrepreneurial strategies and practices. Findings indicate that interventions such as microfinance, digital platforms, vocational training, renewable energy projects, and communitydriven models have demonstrated substantial potential in improving livelihoods and reducing vulnerability among marginalised populations. However, persistent challenges remain regarding long-term sustainability, scalability, and context-specific adaptation. What makes this review unique is its interdisciplinary approach, linking business strategy to social results. It offers a wellrounded view of how entrepreneurship can be used to tackle deep-rooted societal issues. This work adds to the existing knowledge by providing a thorough analysis of how social innovation in entrepreneurship can drive significant change, encourage inclusivity, and support sustainable development. It also offers insights that can guide future research, policy, and practice seeking to leverage entrepreneurial innovation for inclusive and sustainable development. Keywords: Social Innovation, Entrepreneurship, Poverty Reduction, Sustainable Development Introduction Social innovation in entrepreneurship plays a strategic role in eradicating poverty (SDG 1) by integrating innovative approaches with entrepreneurial activities to create opportunities, improve access to resources, and enhance livelihoods in underserved communities (Apetu et al., 2024; Majeed er al., 2025). These socially driven initiatives not only tackle immediate economic challenges but also promote sustainable income generation, strengthen community resilience, and improve long-term well-being (Dobarrio Machado Ciccarino & Serrano Fernandes Rodrigues, 2023). By prioritising inclusivity, equity, and collective welfare, social innovation extends beyond conventional innovation, demonstrating its potential as an effective pathway for poverty reduction and the advancement of inclusive and sustainable development (Millard & Fucci, 2023; Bucos, 2024). Rationale for the Review Persistent poverty and widening inequalities exacerbated by climate, health, and economic shocks demand approaches that blend market discipline with social missions. Social innovation in entrepreneurship (SIE) operationalizes this blend via new products, processes, platforms, and governance models (e.g., social enterprises, inclusive businesses, cooperatives, digital platforms) that expand access, affordability, agency, and livelihoods. Yet, the evidence base is fragmented across sectors (finance, energy, agriculture, health, education), methods (RCTs to ethnographies), and outcome measures (income, wellbeing, capabilities), making it hard for decision-makers to see “what works, for whom, under what conditions, and at what cost.” This review synthesizes the last decade of SIE scholarship to guide researchers, funders, and policymakers toward scalable, equitable, and context-fit pathways to poverty reduction aligned with the SDGs. Aims and Review Questions This systematic review provides an interdisciplinary synthesis of SIE’s contributions to poverty reduction and sustainable development. We aim to: Examine the role of social innovation in entrepreneurship in addressing poverty. Assess the contribution of social innovation in entrepreneurship to sustainable development. Compare the application and effectiveness of social innovation in entrepreneurship in advanced and emerging economies. Identify drivers and barriers influencing the implementation of socially innovative entrepreneurial initiatives. Provide recommendations for policymakers, practitioners, and social entrepreneurs to enhance the impact of social innovation on poverty reduction and sustainable development. Identify gaps in existing literature and propose areas for future research. Primary Research Question How, and under what conditions, does social innovation in entrepreneurship reduce poverty and advance sustainable development across low-, middle-, and high-inequality contexts during 20142025? Secondary Questions  Which SIE models yield the largest/most reliable poverty impacts?  Through which mechanisms (access, affordability, productivity, risk reduction, empowerment) are impacts realized?  What contextual moderators (region, gender targeting, sector, regulatory environment, business model, scale) explain heterogeneity of effects?  What equity, ethics, and justice concerns arise (beneficiary participation, price fairness, data rights, exclusion risks)? Distinctive Contribution Compared with prior reviews, this study explicitly links SIE mechanisms to measured poverty outcomes; integrates mixed-methods evidence with transparent risk-of-bias assessment; and proposes policy-and-investment pathways for scaling, with an equity lens (gender/disability/youth/rural). We also provide an open, reproducible workflow (codebook, forms, and scripts) for future updates. MATERIALS AND METHODS Research Design We conduct a PRISMA-2020 compliant systematic review of peer-reviewed studies and reviews examining SIE interventions with poverty-related outcomes. No primary data collection is undertaken. Evidence types include experimental/quasi-experimental evaluations, observational studies with counterfactual strategies, mixed-methods, and qualitative studies that report outcome-relevant findings. This review adopts a narrative approach while integrating systematic procedures to ensure rigour and reliability. The purpose was to identify, assess, and synthesise literature on the role of social innovation in entrepreneurship in alleviating poverty and fostering sustainable development. The review draws on scholarly and empirical evidence, applying qualitative thematic analysis to interpret findings and generate insights that reflect the intersection of entrepreneurship, social innovation, and socio-economic issues. RESULTS Research Question This section provides in-depth responses to the review questions on Social Innovation in Entrepreneurship (SIE) as a pathway to poverty reduction and sustainable development. Findings are tabulated and discussed in terms of how they contribute to the evidence base on SIE mechanisms, outcomes (income, jobs, assets/savings, service access/affordability, empowerment), and enabling conditions across sectors and regions. Selection and Retrieval of Studies Selection and Retrieval of Studies (PRISMA 2020) Identification  Records identified via databases (Scopus, WoS, ABI/INFORM): n = 1,284.  Duplicates removed before screening: n = 252 (19.6% of identified).  Records after deduplication (to screening): n = 1,032 (80.4% of identified). Screening  Titles/abstracts screened: n = 1,032.  Records excluded at abstract stage: n = 702 (68.0% of screened) for being out of scope (e.g., CSR without entrepreneurial innovation), purely conceptual without outcomes, or macro-narrative without intervention evidence. Eligibility  Full-text reports assessed for eligibility: n = 330 (32.0% of screened).  Full-text reports excluded: n = 318 (96.4% of assessed) due to lacking poverty-relevant outcomes, no evaluative design/counterfactual, or insufficient methodological rigor/traceable outcome measures. Included  Studies included in qualitative synthesis: n = 12 (3.6% of assessed; 0.9% of identified).  Quantitative synthesis: limited vote-counting by direction of effect for outcomes with sufficient homogeneity as shown in Figure 1 Prisma. Main Selected Studies (n = 12) Regions: Sub-Saharan Africa (5); South Asia (3); Latin America/Caribbean (2); multi-country (2). Sectors: Financial inclusion (4); Off-grid energy (3); Agriculture value chains/co-ops (2); Health access (1); Education/skills (1); WASH (1). Designs: RCT (3); quasi-experimental DiD (4); PSM/IV (2); mixed-methods with credible outcome tracking (3). Target groups: Women-focused (6/12); youth (4/12); predominantly rural (8/12). Outcomes reported: Income/consumption (10/12); employment/enterprise formation (6/12); assets/savings/credit access (7/12); service access/affordability (5/12); empowerment/capabilities (4/12). Direction of effects (vote-counting): Positive income/consumption gains in 9/12 studies; employment gains in 5/6 reporting studies; improved assets/savings in 6/7; improved service access/affordability in 4/5; empowerment signals in 3/4. Null/mixed findings occurred mainly where affordability safeguards or last-mile distribution were weak. Equity notes: Gender-intentional designs and affordability safeguards (e.g., PAYGo, cross-subsidies) correlate with positive effects; exclusion risks persist for the ultra-poor where upfront costs or digital KYC barriers remain. Risk of bias (overall): Low (4); Moderate (6); High (2) typically due to attrition, measurement non-blinding, or unobserved selection.