Benefit Corporations in the United States and Community Interest Companies in the United Kingdom: Does Social Enterprise Actually Work?
Abstract: Social enterprise is becoming an increasingly popular and profitable venture in the United States and around the world today. In the United States, the benefit corporation model leads this movement, offering incorporating companies a positive image, a platform to build consumer trust, and the flexibility to pursue social good. However, though the benefit corporation form comes with the aforementioned branding advantages, states’ benefit corporation laws as they currently exist generally lack adequate oversight mechanisms. Consequently, third parties like B Lab play an important role as the primary enforcement entities ensuring that benefit corporations adhere to their stated purposes. The U.S. benefit corporation could gain from a close analysis of the U.K. community interest corporation, as the latter model places greater emphasis on impacts to local community and operates under strict government oversight. Simultaneously, U.K. community interest corporations could enhance their efficacy by incorporating benefit corporations’ emphasis on global branding. By gaining from the other’s strengths, U.S. benefit corporations and U.K. community interest corporations could gain considerable influence, not only as profitable and community-centered businesses but also as global leaders in today’s growing social enterprise movement.
Benefit Corporations in the United States and Community Interest Companies in the United Kingdom: Does Social Enterprise Actually Work?,
Nw. J. Int'l L. & Bus.