Journal of Business Ethics

, Volume 110, Issue 1, pp 133–150 | Cite as

Assessing the Accountability of the Benefit Corporation: Will This New Gray Sector Organization Enhance Corporate Social Responsibility?

Article

Abstract

In recent years the benefit corporation has emerged as a new organizational form dedicated to legitimizing the pursuit of corporate social responsibility (CSR). Eschewing traditional governmental authority, the benefit corporation derives its moral legitimacy from the values of its owners and the oversight of a third party evaluator. This research identifies the benefit corporation as a new type of gray sector organization (GSO) and applies extant theory on GSOs to analyze its design. In particular, it shows how the theory of GSO accountability can be used to assess the potential of benefit corporations for enhancing CSR. This research first examines the statutes that have established benefit corporations in five states in the US, along with bills in other states, to show how legislation defines their specific public benefits and holds them accountable for delivering these benefits. It then compares the accountability of the benefit corporation with that of other corporate-centric GSOs, e.g., GSOs that closely resemble traditional corporations. It concludes with significant design-based concerns about the utility of the benefit corporation as an effective organization for implementing CSR.

Keywords

Accountability B-corporation Benefit corporation Government-sponsored enterprise Gray sector organization 

Abbreviations

CSR

Corporate social responsibility

GSE

Government-sponsored enterprise

GSO

Gray sector organization

Quango

Quasi-autonomous nongovernmental organization

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Copyright information

© Springer Science+Business Media B.V. 2012

Authors and Affiliations

  1. 1.College of Business Administration, Northeastern UniversityBostonUSA

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