This unit will cover the following topics:
- Low-Profit Limited Liability Company (L3C)
- Benefit Corporations
- Benefit Limited Liability Companies and Benefit Limited Partnerships
- Social Purpose Corporations
- B Lab Model – Benefit Enforcement Proceeding
- eBay Domestic Holdings, Inc. v. Newmark, 16 A.3d 1 (Del. Ch. 2010).
This unit was written by J. Haskell Murray, Associate Professor of Business Law and Ethics, Belmont University, Massey College of Business.
Businesses that focus on the common good are sometimes called social enterprises. The line between social enterprises and traditional for-profit businesses is not well-defined in the United States, but since 2008 a variety of legal entity types have arisen to expressly pursue public purposes. Each of the major social enterprise forms are discussed below. The benefit corporation form receives the most attention because it has more state statutes than all the other forms combined and has also attracted many more businesses than the other forms.
For additional reading, see Dr. Lécia Vicente’s article, The Social Enterprise: A New Form of Enterprise?, Am. J. of Comp. Law (forthcoming 2022) and the sources listed at the end of the unit.