2013 Presentations (Communicative Events)

Hybrid Enterprises and the Application of State Charitable Regulatory Principles as a Guide Toward an Effective Regulatory Framework

Grant, Elizabeth M.

In recent years, the convergence of several forces have contributed to the rapid adoption of legislation in many states enacting new organizational forms intended to encourage the development of social enterprises. These forms are sometimes referred to as “hybrids,” meaning they share characteristics of both for-profit businesses and charities. The first such legislative effort was the low-profit limited liability company (L3C). The L3C legislative effort has been overtaken recently by the benefit corporation concept. Other variations are also emerging. Nonprofits have been the traditional vehicle through which people pursue charitable or social advancements and for-profits have been the vehicle through which people pursue financial gain. The goal of the hybrid movement is to create a new organizational form that facilitates the pursuit of both goals at the same time.