Social Enterprise Law: Trust, Public Benefit and Capital Markets

ISBN : 9780190249786

Dana Brakman Reiser
208 Pages
156 x 235 mm
Pub date
Oct 2017
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  • Controversial thesis: law can make corporations better citizens and make it easier for start-ups to raise capital by preventing insiders from selling out a social mission for increased profit
  • Timely analysis: explores potential impact of new crowdfunding rules and increasingly popular hybrid legal forms such as the benefit corporation on the ability of start-ups to raise capital
  • Provocative solutions: several chapters show how corporate governance, contract and even tax law can be harnessed to balance public good against private greed

Social enterprises represent a new kind of venture, dedicated to pursuing profits for owners and benefits for society. Social Enterprise Law provides tools that will allow them to raise the capital they need to flourish. 
Social Enterprise Law weaves innovation in contract and corporate governance into powerful protections against insiders sacrificing goals such as environmental sustainability in the pursuit of short-term profits. Creating a stable balance between financial returns and public benefits will allow social entrepreneurs to team up with impact investors that share their vision of a double bottom line. Brakman Reiser and Dean show how novel legal technologies can allow social enterprises to access capital markets, including unconventional sources such as crowdfunding. With its straightforward insights into complex areas of the law, the book shows how a social mission can even be shielded from the turbulence of an acquisition or bankruptcy. It also shows why, as the metrics available to measure the impact of social missions on individuals and communities become more sophisticated, such legal innovations will continue to become more robust. 
By providing a comprehensive survey of the U.S. laws and a bold vision for how legal institutions across the globe could be reformed, this book offers new insights and approaches to help social enterprises raise the capital they need to flourish. It offers a rich guide for students, entrepreneurs, investors, and practitioners.


Introduction: Social Enterprise Law 2.0
Chapter 1: The Social Enterprise Trust Deficit
Chapter 2: Prioritizing Mission with a Mission-Protected Hybrid (MPH)
Chapter 3: Evaluating the Current Menu of Legal Forms for Social Enterprise
Chapter 4: From Form to Finance
Chapter 5: The Holy Grail of Retail Investment
Chapter 6: The Promise of Metrics
Chapter 7: Social Enterprise Exits

About the author: 

Dana Brakman Reiser, Professor, Brooklyn Law School, and Steven A. Dean, Professor, NYU Law
Professor Brakman Reiser has been teaching and writing about social enterprise and nonprofit law as a member of the Brooklyn Law School faculty since 2001. She was an Associate Reporter for the American Law Institute's Principles of the Law of Nonprofit Organizations and is a graduate of Harvard Law School.
Professor Dean teaches Tax Law at NYU Law, prior to which he taught tax at Brooklyn Law School, where he also served as Vice Dean. He joined the faculty at Brooklyn Law School after practicing transactional law at two global law firms. He is a co-author of forthcoming book Federal Taxation of Corporations and Corporate Transactions and is a graduate of Yale Law School.

"This well-written and thoughtful work covers fundraising by mission-based companies from birth to death. In doing so, it highlights the unique problems that these enterprises raise, but also suggests that lawyers can play an important role in solving these problems. Given that the solutions to many urgent social and environmental issues may require significant capital, I hope that business lawyers take notice of this book, and use it to spur their thinking." - Rick Alexander, B Lab

"This book reveals how the law can help business people give priority to social mission, pursue profit, and get more of both because the public will love them." - Terry Mollner, founder of Calvert Social Funds and architect of Ben & Jerry's mission-protecting sale to Unilever

"Brakman Reiser and Dean argue convincingly that the law can be an effective tool for mobilizing capital for social enterprises by building trust between investors and social entrepreneurs. Their proposed innovations of mission-related hybrid organizations, flexible low yield debt instruments and a new tax regime for dual mission enterprises, define the frontier for building a more robust social enterprise sector. The book is clearly and forcefully written and path breaking." - Dennis R. Young, Professor Emeritus, Georgia State University

"With the growing importance of making social enterprises effective in fulfilling their mandate, Brakman Reiser and Dean to a marvelous job in making a very complex and important subject accessible. They both take stock and look forward, thus providing a resource for professionals of social enterprise, impact investors, legal experts, and also the increasing number of scholars doing research on social enterprise and/or hybrid organizations." - Johanna Mair, Professor of Organization, Strategy and Leadership, Hertie School of Governance

"Professors Brakman Reiser and Dean have done a great service to the social enterprise community by exploring how the law can create the conditions that will protect the dual social and commercial goals of social enterprises and help facilitate their access to capital. Social Enterprise Law provides a very insightful and compelling overview of opportunities and challenges for legal instruments to ensure trust between social entrepreneurs and investors, which will interest practitioners, policy makers and researchers alike." - Julie Battilana, Professor of Business Administration, Harvard Business School, and Gleitsman Professor of Social Innovation, Harvard Kennedy School

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