Saturday, August 29, 2020
Article on For Whom Are Non-Profit Managers Trustees? The Contractual Revolution in Charity Governance
Jacob Hale Russel recently published an article entitled, For Whom Are Non-Profit Managers Trustees? The Contractual Revolution in Charity Governance, Wills, Trusts, & Estates Law ejournal (2020). Provided below is the abstract to the Article.
This chapter chronicles an unnoticed aspect of the intellectual history of the “contractarian” paradigm, the descriptive claim that firms are best characterized as nexus of contracts. Although the paradigm’s rise in the 1980s in the corporate world is well known, little has been said about its success in rewriting both theory and doctrine in charitable and not-for-profit law. The contract paradigm has reshaped the questions that not-for-profit scholarship attempts to answers, and it is tightly linked to developments in not-for-profit doctrine and practice. Key examples include the growth of donor standing — the notion that not-for-profits have a fiduciary duty to their donors, and that donors may bring suit for breaches — and the growing obsession with “donor intent” throughout the not-for-profit sphere. I contrast contractarianism with an institutionalist “public trust” conception of charities, which was the prevailing intellectual paradigm for most of the 20th century.