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Full-Text Articles in Law
The Limits Of Charity Fiduciary Law, Evelyn Brody
The Limits Of Charity Fiduciary Law, Evelyn Brody
Evelyn Brody
Trustees of charitable trusts and directors of nonprofit corporations operate under legal regimes designed for their for-profit cousins. In the absence of private beneficiaries or shareholders to look after their own interests, however, charity fiduciaries frequently escape accountability for their self-dealing and neglect or mismanagement. Few charities have members endowed with voting rights, and state attorneys general have limited resources to devote to monitoring the nonprofit sector. Similarly, at the federal level, the Internal Revenue Service is a tax collector, not a policing agency (although its new powers to tax excess benefits will undoubtedly draw it further into charity operations). …
Charitable Endowments And The Democratization Of Dynasty, Evelyn Brody
Charitable Endowments And The Democratization Of Dynasty, Evelyn Brody
Evelyn Brody
Charitable endowments and other passive investments exceed $425 billion. Why do many donors require that the principal of their contribution must be held in perpetuity, and that only the income may be used for charitable purposes? Why do most charity managers voluntarily accumulate operating surpluses, and reinvest a portion of real endowment income? This Article suggests that rather than looking at how charities use their endowment income, we should focus on what happens to the endowment principal. It appears that the taste for perpetual charitable endowments persists as the happy co-incidence of donors' desire for immortality for themselves and their …
Agents Without Principals: The Economic Convergence Of The Nonprofit And For-Profit Organizational Forms, Evelyn Brody
Agents Without Principals: The Economic Convergence Of The Nonprofit And For-Profit Organizational Forms, Evelyn Brody
Evelyn Brody
Are nonprofit organizations 'different' from firms with owners? The accepted economic account holds that nonprofits are more trustworthy than business firms because nonprofits cannot distribute profits to owners. However, all firms, nonprofit or proprietary, have converged into similar patterns of behavior. Firms, whether nonprofit or proprietary (or even public), are subject to many of the same economic forces, such as resource dependency, institutional isomorphism, and organizational slack. Even in the absence of shareholders somebody still has to run the enterprise: to decide what objectives to pursue, and how; to manage its financial and human resources; and to span the boundaries …
Institutional Dissonance In The Nonprofit Sector, Evelyn Brody
Institutional Dissonance In The Nonprofit Sector, Evelyn Brody
Evelyn Brody
Our political and economic system contains three seemingly distinct sectors: public, proprietary, and nonprofit. This division masks serious issues of who should provide welfare services, schooling and health care; who should build infrastructure; who should control private wealth. The nonprofit law takes a laissez faire approach to permissible nonprofit activities, leading many to lament the increasing 'commercialization' of the nonprofit sector. However, an examination of historical as well as current activities engaged in by firms in all three sectors reveals that the basis terms of the social debate are eternal, while institutions dominant at different times and in different places …