Ben & Jerry’s started out as a company with two bottom lines: profit and people. They were fair to employees, easy on the environment, and kind to its cows. But when it got sold to Unilever (described as “a giant multinational clearly focused on the financial bottom line”) in 2000, it wasn’t because the founders dodged their original social mission, but rather it was because they had a legal responsibility to consider takeover bids, and that particular responsibility forced the sale.
Being a public company the board of directors had the responsibility of acting in the interest of the shareholders, and when that offer was put on the table they got bought out.
The Ben & Jerry’s case is what continually haunts social entrepreneurs today. Taking on the corporate form of organization would mean that one day, they may become the second Ben & Jerry’s. That is why for the past decade, social entrepreneurs have been calling for new legal forms of organization. The L3C, benefit corporations, and flexible purpose operations have been enacted in several states in the US, and generally allow companies to pursue profit and social missions together. There continues to be significant efforts in lobbying states to enact them.
If these new forms of organization were present at the time Ben & Jerry’s got bought out, perhaps their outcome would have been different. But as the company now demonstrates through their initiatives to foster social entrepreneurs, maybe the only important thing is to do good, regardless of structure.
To read The Truth About Ben and Jerry’s by Antony Page and Robert A. Katz, visit http://www.ssireview.org/pdf/Fall_2012_The_Truth_About_Ben_and_Jerrys.pdf
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