Abstract: State statutes authorizing firms to pursue mixtures of profitable and socially beneficial goals have proliferated in the past five years. In this invited response essay, I argue that for one large class of charitable goals, the so-called “social enterprise” firm is often privately wasteful. Although the hybrid form is a bit more sensible for firms that combine profit with simple, easily monitored social benefits, existing laws fail to protect stakeholders against opportunistic conversion of the firm to pure profit-seeking. Given these failings, I suggest that social enterprise’s legislative popularity can best be traced to a race to the bottom among states competing to siphon away federal tax dollars for local businesses. Not all hybrid forms inevitably are failures, however. For example, the convertible debt instruments proposed by Dana Brakman Reiser and Steven Dean— the inspiration for this response—offer a promising route forward for “cold glow” firms wishing to clean up some easily-measured but harmful business practices.
BCLR Moves to # 25 in Law Journal Rankings
The Boston College Law Review has moved from #26 to #25 in the annual Washington and Lee University School of Law Law […]
Alumni-Student Happy Hour, February 19
Dear BCLR Alumni, I am pleased to announce that the Boston College Law Review will be hosting its Alumni-Student Happy […]
2014 E. Supp. Now Available
We have begun posting case comments from recent federal appellate decisions to our 2014 E. Supp., which can be found […]