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The Benefit Corporation: Corporate Governance and the For‐profit Social Entrepreneur
Author(s) -
Hemphill Thomas A.,
Cullari Francine
Publication year - 2014
Publication title -
business and society review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.524
H-Index - 21
eISSN - 1467-8594
pISSN - 0045-3609
DOI - 10.1111/basr.12044
Subject(s) - corporation , statute , shareholder , legislature , corporate governance , business , government (linguistics) , corporate law , profit (economics) , economics , law , finance , political science , linguistics , philosophy , microeconomics
The adoption by 19 states and the D istrict of C olumbia of a new variant of the business corporation form—known as the benefit corporation—presents several issues for legislatures, for entrepreneurs electing to organize as benefit corporations, for existing corporations that are converting to the new form, and for the stakeholders (other than shareholders) who are intended to be considered in benefit corporation governance. The article presents the history and structure of the new business form and a discussion of what has become its predecessor—the constituency statute. The model benefit corporation statute provisions are reviewed, which many states have adopted in toto. The authors address the obstacles that should be overcome by legislatures, businesses, and stakeholders before further legislative adoptions occur, as well as considerations for effective implementation by government, corporations, and stakeholders under existing and proposed variations of the statute.