Can Social Enterprise help to achieve Family Restoration?

FamilyRestoration is honored to welcome guest blogger Professor J. Haskell Murray (Regent University School of Law, hmurray@regent.edu; Scholarship | Faculty Profile | Twitter) for this guest post highlighting the Regent Law Review upcoming symposium this weekend:

On October 6, 2012, Regent University Law Review will host a symposium entitled "Emerging Issues in Social Enterprise."  The symposium features highly respected corporate and tax law professors, some of the most published professors in the social enterprise space, attorneys with corporate and social enterprise experience, the Chief Executive Officer of one of Virginia's leading social enterprises, and a Regent University School of Law graduate who is a social enterprise attorney, a social entrepreneur, and a Lecturer on Law at Harvard Law School.  More information about the symposium participants can be found here.  Can social enterprise help to achieve family restoration?  When a company focuses on the common good the social benefits to families can be significant.

The definitions for "social enterprise" vary widely.  Most agree that social enterprises are hybrid entities that fit somewhere in-between nonprofit and for-profit organizations. The Social Enterprise Alliance lists the distinguishing characteristics of "social enterprise" as follows:

  • "It directly addresses an intractable social need and serves the common good, either through its products and services or through the number of disadvantaged people it employs.
  • Its commercial activity is a strong revenue driver, whether a significant earned income stream within a nonprofit’s mixed revenue portfolio, or a for profit enterprise.
  • The common good is its primary purpose, literally “baked into” the organization’s DNA, and trumping all others."

The two most popular forms of social enterprise are L3Cs and benefit corporations.  L3C statutes have been passed by nine states (IL, LA, ME, MI, NC, RI, UT, VT, WY).  Benefit corporation statutes have been passed by 11 states (CA, HI, IL, MA, MD, LA, NJ, NY, SC, VT, and VA).  The Illinois and Massachusetts benefit statutes do not go effective until January 1, 2013.  These social enterprise forms are recent developments.  The first L3C statute was passed by Vermont in 2008 and the first benefit corporation statute was passed by Maryland in 2010.  In addition to, or instead of, the social enterprise entity forms, such as L3Cs and benefit corporations, businesses can chose to become a certified B corporation, which is akin to a LEED or a "fair trade" certification for the entire company.  I explain the differences between certified B corporations and benefit corporations here.

For those who are interested in further reading, symposium participant Professor Cass Brewer(Georgia State) has an article on L3Cs, and symposium participant Professor Dana Brakman Reiser (Brooklyn) has an article on benefit corporations.  In addition, I have co-authored an article on L3Cs published in the University of Miami Law Review and a draft of an article on benefit corporations that is scheduled to be published in the American University Business Law Review as part of its social enterprise symposium issue.  I also created a research chart to compare the various benefit corporation statutes.  

Many social entrepreneurs are already attempting to make a positive impact on society thorough these new forms, and I am sure that some of this blog’s readers could think of creative ways to use social enterprise to help achieve family restoration.  We hope to see some of this blog’s local readers at our symposium this Saturday and, if you plan on attending, please register here


  1. I really like the idea that corporations are beginning to focus on the "common good" of society rather than solely on maximizing shareholder wealth. Family restoration is becoming more and more important as our society continues to evolve. Benefit corporations and Low-Profit Limited Liability Companies may be able to offer services and ideas that will aid in the "family restoration movement". I am happy to see that Virginia, the state I will be practicing in , has passed Benefit Corporation statutes in an effort to promote businesses that foster charitable and socially beneficial objectives. As a hopeful future member of the Virginia State Bar, I am glad to see that Virginia has taken the initiative to promote the idea of family restoration by allowing companies to use either its products and/or services to create an environment that is primarily focused on helping disadvantaged people and that directly supports a common social need.

  2. I do believe that social enterprises can have a positive effect on family restoration. I think that it is great when any enterprise can adopt a business model which puts family values first. However, I do not believe that a business entity has to be a social enterprise to have a profound impact on society or family restoration. Non-social enterprise can still have a profound effect on the community. Any business entity can, and I think it should, donate money to charitable organizations which support families. Such an act would give charitable organizations a much needed source of funding and it will show the public that the business does care about its customer's families. Thus, securing the continued patronage of its current customer base. Maybe even attracting new customers. Additionally, businesses can provide their employees with one or two "community service" paid days off. With this policy in place, employees may take a paid day off from work to volunteer their time to any approved community service organization. While these are only two ideas that non-social enterprises can do there are many more. I believe that it is in society's and the shareholder's best interest when,corporations or other business entities, makes families their focus.