The social enterprise movement, which began in earnest in the early 1980’s, has evolved and expanded significantly in recent years. Whether defined as applying business- and market-based approaches to solving social problems, or pursuing earned revenue strategies to achieve a double- or triple- (financial, social, and sustainable) bottom line, innovators and entrepreneurs from both the business and nonprofit sectors are blurring the traditional lines between them, creating nonprofit, for-profit, and hybrid vehicles to house and grow their social enterprises, and challenging their legal advisors to use or change the existing legal framework to meet their needs. Meanwhile, many grant makers have become increasingly focused on identifying and funding social innovators and social entrepreneurs.
Areas of Focus
- Identifying and implementing the most effective legal structures to suit the business plan for a new or expanding social enterprise, taking into account tax-exemption, unrelated business taxable income, asset protection, and other key legal issues.
- The impact of new social enterprise activities on the tax and legal status of an established tax-exempt organization, whether those activities are conducted directly or through a subsidiary or other affiliate.
- When and how best to use or combine a range of available and emerging entity forms, including for-profit and nonprofit corporations, LLCs, L3Cs, flexible purpose corporations, corporations formed to take advantage of state constituency statutes, and benefit corporations.
- Legal issues affecting social enterprises which operate internationally.
- The legal distinctions for tax-exempt investors among socially responsible investing, mission-related investments, and program-related investments in social enterprises.
- Legal issues that affect institutions that invest in or otherwise facilitate the growth of social enterprises, whether through grantmaking, equity ownership, or loans.
Related Blog Posts (13)
Related Publications (1)
-
June 2009
Effective Social Enterprise-A Menu of Legal Structures
What is the definitive legal form for a new social enterprise — a nonprofit corporation that is tax exempt as an organization described in IRC section 501(c)(3).Author
Practice Areas:
Past Events
-
In-Person November 8, 2024
American Bar Association's LLC Institute 2024 with Stetson Law School - Session: "A Versatile Vehicle for 21st Century Philanthropy"
Philanthropy in the 2020s is a far cry from the days of Carnegie and Rockefeller. Impact-oriented philanthropic funders and charitable organizations are increasingly creative in their approach to achieving charitable objectives. To that end, vehicles commonly associated with for-profit business, such as limited liability companies, are frequently used to achieve these objectives. This panel will discuss an overview of several practical ways LLCs can enhance philanthropic enterprises, as well as academic reflections regarding this trend.
Presenters:
- Prof. Joan MacLeod Heminway, The University of Tennessee College of Law
- Prof. Eric Amarante, The University of Tennessee College of Law
- Sharon C. Lincoln, Casner & Edwards
- Andrew Schulz, Adler & Colvin
11:25 a.m. to 12:55 p.m. ET
Tampa, Florida
1.5 hours of CLE credit
Presenter
-
In-Person Conference May 5, 2023
American Bar Association, Section of Taxation, 2023 May Meeting, E.O. Committee - Session: “New Kid on the Block: Purpose Trusts"
2:45 p.m. – 4:00 p.m. ET at the University of DC & Catholic University, Level M1 | Exempt Organizations PM Session 9
Patagonia has been in the news for using a purpose trust and a 501(c)(4) to accomplish the founder’s
philanthropic goals. What exactly is a purpose trust? How does this structure work, and what are its advantages and disadvantages? Is this trending? What are the implications for using private foundations?Moderator: Robert Wexler, Adler & Colvin
Panelist: Susan Gary, University of OregonChair: Rosemary E. Fei, Adler & Colvin
Presenter(s)
-
In-Person Conference January 19, 2023
The University of Texas School of Law’s 40th Annual Nonprofit Organizations Institute Conference - Session: "A View of the Sector"
Explore the latest in policy and regulation from the US Government in an effort to answer the question: What just happened? You’ll be the first to know about topics like donor-advised fund regulations, end-of-year legislation, and what is Congress likely to do next? What about those expiring incentives for charitable giving, will they be renewed? Meanwhile, the Supreme Court continues to unwind the regulatory powers of the executive branch.
8:30 a.m. – 9:30 a.m. CT
Co-Presenter: Alex Reid, Baker & Hostetler LLP
Presenter
-
Webinar April 29, 2021
Oklahoma Center for Nonprofits - Nonprofit Law and Finance Conference — Generating Profit in your Nonprofit: An Introduction to Social Enterprise
Co-speaker: Jinna Kwak, Adler & Colvin
Presenter
-
Panel May 14, 2018
Mission Investors Exchange 2018 National Conference: Mission Forward! “Introduction to Impact Investing: A 101 for Beginners”
Co-panelist: Eric Stephenson, Cordes Foundation
Co-panelist: Rehana Nathoo, Case Foundation
Chicago, IL
Presenter
