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2 - Corporate Purpose

Published online by Cambridge University Press:  12 March 2023

Ernest Lim
Affiliation:
National University of Singapore
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Summary

This chapter argues that the existing corporate laws of the four Asian jurisdictions and the laws regulating social enterprises in the US and UK that deal with purpose are generally ineffective in preventing the subordination of social benefit to profit; the laws are inadequate to ensure that social benefit is prioritized. Thus, I argue that in my proposed legal form, under the first criterion, there should be a requirement to the following effect that “on the whole, the pursuit and delivery of social benefit is prioritised over profit-making except where doing so will have a material and adverse effect on the financial viability of the social enterprise.” To make this argument, I first distinguish between corporate interest, corporate object, and corporate interest. I then examine the company laws of the four common law Asian jurisdictions, followed by the US benefit corporation and social purpose corporation as well as the UK community interest company. Subsequently, I propose a corporate purpose to which social enterprises should adhere and I show how this purpose can be privately and publicly enforced.

Type
Chapter
Information
Social Enterprises in Asia
A New Legal Form
, pp. 46 - 78
Publisher: Cambridge University Press
Print publication year: 2023

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  • Corporate Purpose
  • Ernest Lim, National University of Singapore
  • Book: Social Enterprises in Asia
  • Online publication: 12 March 2023
  • Chapter DOI: https://doi.org/10.1017/9781108937313.006
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  • Corporate Purpose
  • Ernest Lim, National University of Singapore
  • Book: Social Enterprises in Asia
  • Online publication: 12 March 2023
  • Chapter DOI: https://doi.org/10.1017/9781108937313.006
Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

  • Corporate Purpose
  • Ernest Lim, National University of Singapore
  • Book: Social Enterprises in Asia
  • Online publication: 12 March 2023
  • Chapter DOI: https://doi.org/10.1017/9781108937313.006
Available formats
×