Founders’ ethical decision-making in early-stage socially innovative, technology-based ventures: developing the Theory of Dynamic Ethical Navigation

The founders in this study address problems left unresolved by current markets, services and institutions. Some build new technologies; others use digital tools differently to widen access, improve care, support inclusion, protect environments or create public interest value. They do this while running young businesses that must generate revenue, build credibility and retain capacity to reinvest in the mission. The surrounding ecosystem is uneven: some actors are supportive, while others are cautious, misaligned or influential without fully understanding the problem, the technology or the ethical consequences of action or delay. This thesis examines how founders of socially innovative, technology-based early-stage ventures define, justify and adapt ethical decisions while building organisations under resource, market, institutional and technical constraints. It draws on business ethics, social responsibility, ethical decision-making, social innovation, responsible innovation, technology ethics and selected social entrepreneurship scholarship. The social entrepreneurship literature is used as an analytical lens for examining mission, legitimacy, public-benefit claims, resource constraint and mission drift; it is not used to classify the participating firms as social enterprises. The study is based on 25 founders of micro-to-small, UK-registered private companies limited by shares (CLS), recorded in Companies House records with the company-type designation “Private Limited Company”. No organisation classed as a Company Limited by Guarantee (CLG) was included. Entities designated “by guarantee”, charities, community interest companies (CICs) and comparable purpose-constrained forms were excluded. The sample is therefore positioned as shareholder-owned and for-profit, with explicit social, environmental, health or public-interest aims. Using an interpretivist qualitative design, the study draws on semi-structured interviews, case-matched documentary reading and a two-stage member-checking process. The findings are organised around three themes: ethical alignment: values, boundary realignment and dissonance; social impact strategy, through which ethical aims are 3 translated into stakeholder engagement, learning, impact evidence, reinvestment and operational judgement; and tech for good, where ethical commitments were embedded, tested or strained through data practices, design choices, technological integration, safeguarding, inclusion and environmental externalities. The study proposes the Theory of Dynamic Ethical Navigation (DEN) as a mid-range explanatory account of how founders seek to hold ethical direction while adjusting scope, pace and safeguards under constraint. DEN interprets ethical decision-making as ongoing navigation rather than a single decision point. It is developed through six mechanisms: Bounded Ethics, Omission-based Dissonance, Osmotic Alignment, Ethical Capabilities Capital, Micro-Transformative Innovation and Ethically Gated Impact Diffusion. The study introduces the VISION model—Values, Impact, Sustainability, Innovation, Ownership and Navigation—alongside three applied tools: the SMAG cadence, the Ethics–Technology Integration Spectrum (ETIS) and the EthOS Lifecycle. Together, these support review of ethical commitments, ethics–technology integration and staged decision-making without treating the tools as universal prescriptions, moral rankings or maturity scores. The thesis contributes to debates on ethical decision-making, responsible innovation and technology-based social innovation by showing how ethical commitments are formed, constrained, evidenced and recalibrated in founder-led ventures. Its limitations relate to the UK context, legal form, early-stage focus and reliance on single-participant founder accounts read alongside public and case-matched materials. Further research could examine later-stage ventures, different legal forms, comparative jurisdictions, stakeholder perspectives and empirical applications of DEN, VISION, SMAG, ETIS and the EthOS Lifecycle.