| Title | 10. Social Enterprises and the Role of Profit in Company Law |
|---|---|
| Contributor | Nena van der Horst (author) |
| Marleen van Uchelen(author) | |
| DOI | https://doi.org/10.11647/obp.0448.10 |
| Landing page | https://www.openbookpublishers.com/books/10.11647/obp.0448/chapters/10.11647/obp.0448.10 |
| License | https://creativecommons.org/licenses/by/4.0/ |
| Copyright | Nena van der Horst; Marleen van Uchelen; |
| Publisher | Open Book Publishers |
| Published on | 2025-06-05 |
| Long abstract | All over the world, social enterprises are actively contributing to solve societal problems. To ensure that these enterprises prioritise their ‘social purpose’ over other goals, these enterprises can make use of a variety of legal forms and legal structures. The chapter sets out that transparency requirements, rules on supervision, and enforcement mechanisms all play an important role in securing the social purpose of the social enterprise. Then, the chapter focuses on profit distributions and the possibilities to limit these as a very important mechanism for securing a social purpose. The chapter outlines the legal rules for profit distribution that apply to social enterprises in Europe with a focus on the Netherlands. Furthermore, it demonstrates that social enterprises have space within these legal rules to design their own limitations on profit distributions. This may be helpful in securing their social purpose, not only because it leaves more reserves available for reinvestments in the social purpose, but also because it may be of influence to certain incentives in the enterprise such as involvement of employees and beneficiaries. Finally, the chapter points out that it is important for social enterprises to have access to sufficient financial resources, in particular to attract capital investors. An important question is how this can be combined with limiting profit distributions. All these topics will undoubtedly be central in company law discussions in Europe in the coming years. In the conclusion, some points for reflection are posed that may contribute to these discussions. |
| Page range | pp. 193–206 |
| Print length | 14 pages |
| Language | English (Original) |
Nena van der Horst, LL.M., works as a PhD Candidate at the Amsterdam Law School
and ACT, on Prof. Marija Bartl’s ERC-funded project ‘Law as a Vehicle for Social Change:
Mainstreaming Non-Extractive Economic Practices’. In this project she is writing a
PhD thesis on the relation between profit distributions to shareholders and corporate
purpose. Nena has a background in private law and economics. She obtained both
her master’s degree in Dutch law (cum laude) and her master’s degree in economics
at the Radboud University in Nijmegen (The Netherlands). She also teaches various
company law courses. See https://www.uva.nl/en/profile/h/o/n.vanderhorst/n.vander-
horst.html
Dr. Marleen van Uchelen is Associate Professor at the Amsterdam Law School and
ACT. She specialises in company law and the laws on various legal entities, including
social enterprises, foundations, and associations. Marleen obtained her doctorate in
2018; her doctoral thesis is called ‘The Role and Position of the Supervisory Board
of the Dutch Foundation’. Besides teaching, she works in the notarial practice and
advises on governance and governance structures, especially in the semi-public sector
(amongst others health care institutions) and the non-profit sector (amongst others
cultural institutions). Marleen regularly publishes in various academic journals and
contributes to book publications. See https://www.uva.nl/profiel/s/c/m.j.schipper/
m.j.van-uchelen.html