April 30, 2012
Are Benefit Corporations Beneficial?
Posted by Haskell Murray

    Thank you for the introduction, Usha.  I read the Conglomerate as a judicial clerk and as a practitioner; and I have continued reading the blog as a new academic. I appreciate the invitation and opportunity to guest blog.

    As Usha noted, I will be blogging primarily about social enterprise.  A few weeks ago, I presented on one of the main social enterprise forms in the U.S. - benefit corporations - at a wonderful symposium hosted by American University Washington College of Law.

    While benefit corporations have not yet received the same severe beatings that its social enterprise cousin the L3C has in law reviews (see, e.g.Daniel Kleinberger, Carter Bishop and Bill Callison & Allan Vestal), most academics I know express doubt that the benefit corporation form will be significantly useful.  I maintain a healthy skepticism and recognize a number of areas that could use improvement, but I am more optimistic than most.  For readers interested benefit corporations, I recommend Professor Dana Brakman Reiser’s article Benefit Corporations -- A Sustainable Form of Organization?, 46 Wake Forest L. Rev. 591 (2011).

    Currently, I have an extremely rough draft of the article I owe American University’s Business Law Review by July.  I am still making structural changes to the article.  One such change involves my recent decision to tackle the admittedly difficult question of whether benefit corporations will be beneficial.  Originally, I had decided to sidestep this question and focus only on how benefit corporations should be governed and how we might improve on the seven state statutes that have been passed. 

    In subsequent blog posts (and in my forthcoming article), I will examine the purported usefulness of the benefit corporation as outlined in the Benefit Corporation White Paper.  The White Paper states that the benefit corporation legislation was drafted to address, among other things, corporate purpose, accountability and transparency.  I plan to address each part of the trio in separate posts.  

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