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Based on interviews with key stakeholder groups of social enterprises in Hungary, democratic practices in decision making were seen as important features of social enterprises. However, there were several comments about participatory governance’s negative effect on operational efficiency. One of the aims of the paper is to explore this controversial finding from the perspective of leaders of social enterprises. In the theoretical part we summarise the foundations of employee involvement and participation (EIP) in small businesses and social enterprises, and possible explanations of how (EIP) may impact job related flow experiences. Based on the qualitative analysis of semi-structured interviews with leaders of social enterprises, we propose as a hypothesis the measurement of the impact of participatory practices on flow experiences of employees and volunteers as an effective evaluation criterion for participatory governance. One interesting finding is that compared to other aspects of participation (e.g. strategic decision making and innovation) involvement in HRM practices (especially regarding the role of middle managers) in social enterprises seems to be with the most direct impact on the wellbeing and flow experiences of employees and volunteers that may be interesting for future research also calling for the examination of employees’ perspectives.

Managing the Flow Experience - The Dilemmas of Participatory Governance in Hungarian Social Enterprises