Stanford Social Innovation Review, Vol. 10, No. 4, Fall 2012
8 Pages Posted: 10 Jul 2013 Last revised: 4 Jan 2016
Date Written: August 30, 2012
In 2000 social enterprise icon Ben & Jerry's Homemade, Inc. was acquired by Unilever, the giant multinational. According to popular legend, corporate law compelled Ben & Jerry's directors to accept Unilever's generous bid - overwhelming founders Ben Cohen and Jerry Greenfield's dogged efforts to maintain the company's social mission and independence. The story of Ben & Jerry's alleged forced sale is a key fixture in debates over new corporate forms such as low-profit limited liability companies (L3Cs), benefit corporations, and flexible purpose corporations. Proponents of new forms invariably invoke the Ben & Jerry's sell-out to demonstrate the need for forms that attempt to embed a company's social mission into its legal structure.
This article debunks the canonical account of that sale. It analyzes the elaborate mechanisms that Ben & Jerry's built to resist hostile takeovers and explain why these defenses, had they been invoked, would almost certainly have worked. Ironically, the full account of the sale does not make the case for new forms; rather, it illustrates how social entrepreneurs can use existing forms in creative ways to protect an enterprise's social mission - even if they later choose not to assert such protections.
Keywords: social enterprise, social entrepreneurship, hybrid organization, corporate law, legal form, organizational form, corporations, corporate social responsibility
JEL Classification: D21, K22, L2, L20, L21, L33, L39, M13, M14
Suggested Citation: Suggested Citation
Page, Antony and Katz, Robert A., The Truth About Ben and Jerry's (August 30, 2012). Stanford Social Innovation Review, Vol. 10, No. 4, Fall 2012; Indiana University Robert H. McKinney School of Law Research Paper No. 2013-25. Available at SSRN: https://ssrn.com/abstract=2291615 or http://dx.doi.org/10.2139/ssrn.2291615