Carpe Crisis: Capitalizing on the Breakdown of Capitalism to Consider the Creation of Social Businesses
New York Law School Law Review, Vol. 54, No. 743, 2010
30 Pages Posted: 15 Aug 2010
Date Written: August 13, 2010
The recent meltdown of the world’s financial systems presents a unique opportunity to examine the very nature of the corporate form and to consider whether other models of business operation are needed. This article explains the idea of “social businesses” – profit-making, but not profit-maximizing entities that operate to further social good instead of exclusively generating returns for their shareholders. The article then explores the current legal regime for both profit and non-profit businesses under United States law, and suggests there is no ideal business structure currently available under which to operate a social business. In light of the increasing recognition that corporations can and should do more than profit-maximize, the article suggests a need for more flexibility to laws governing business entities.
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