How Change Happens: The Benefit Corporation in the United States and Considerations for Australia

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Abstract

As social enterprise has gained in profile, there has been a proliferation of new hybrid corporate forms that combine the pursuit of both profits and social objectives, and the creator of the popular benefit corporation is currently lobbying to introduce ‘benefit companies’ in Australia. While they are well-intended, this chapter queries whether these new structures are ultimately just a sideshow to distract from the failure to reform expectations surrounding traditional corporations, which are often wrongly presented as inadequate to support socially responsible business practices. Might the spread of hybrids inadvertently serve to ghettoise expectations for socially beneficial and sustainable corporate behaviour? This chapter briefly describes the new structures that have emerged. It then argues that directors’ duties owed to the traditional corporation do not preclude the consideration of other stakeholders and that the arguments in favour of the hybrids skew our understanding of the traditional corporation and obscure the need for socially responsible conduct on the part of traditional corporations. The chapter finally argues against adopting a hybrid form in Australia.
Original languageEnglish
Title of host publicationCreating corporate sustainability
Subtitle of host publicationGender as an agent for change
EditorsBeate Sjafjell, Irene Lynch-Fannon
Place of PublicationCambridge
PublisherCambridge University Press
Chapter9
Pages188-212
Number of pages24
ISBN (Electronic)9781316998472
ISBN (Print)9781108427111
DOIs
Publication statusPublished - May 2018

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    Baumfield, V. S. (2018). How Change Happens: The Benefit Corporation in the United States and Considerations for Australia. In B. Sjafjell, & I. Lynch-Fannon (Eds.), Creating corporate sustainability: Gender as an agent for change (pp. 188-212). Cambridge University Press. https://doi.org/10.1017/9781316998472.011