Multi-layer agency problems in a non-profit and for-profit collaboration: A case study of a delicatessen product in support of a minority

Abstract

The study investigated the collaboration between a non-profit and a for-profit organization and evaluated the benefits and drawbacks of the collaboration for the non-profit partner. The non-profit partner is a charitable organization that supports an ethnic minority in one of the least economically affluent European countries. The collaboration stemmed from a project, in which members of the minority cultivated and processed a delicatessen product for the market in more affluent European countries. The collaboration did not succeed to fully produce the desired results. It was negatively affected by inadequate communication, the absence of meta-goals, as well as classical and multi-level agency problems. In part due to the inexperience of both partners with such collaborations, the for-profit partner seems to have taken hidden actions. These actions did not contribute to the project goals, respectively jeopardized the goals and reputation of the non-profit partner.