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About the Legal Strategy Group

Due to the hybrid nature of their activity, Fourth Sector organizations in the US are encountering limitations imposed by existing legal and tax structures at both the federal and state levels. This often requires them to compromise their objectives, complicate their organizational structures, and invent and implement circuitous processes that distract their focus and deplete resources. Moreover, the attorneys who advise them are typically specialized in corporate or non-profit law and often lack a clear understanding of all the existing legal authorities that affect Fourth Sector activity.

To begin addressing these issues, a group of prominent attorneys, legal scholars, social entrepreneurs, funders and investors were convened at the Aspen Institute in September, 2006 in a meeting entitled “Exploring New Legal Forms and Tax Structures for Nonprofit/For-Profit Hybrid Organizations” (click here for report). Following this successful meeting, a follow-up gathering was held at the Social Enterprise Alliance conference in April 2007. These two convenings served to focus attention on and elevate discourse about the regulatory environment surrounding Fourth Sector activity and played a key role in the launch of several initiatives. More recently, a third legal strategy meeting was convened with at NYU Law School in July, 2008. This meeting, entitled “Establishing New Legal Forms For Fourth Sector Organizations,” brought together attorneys, legal scholars and social entrepreneurs to explore the limits on Fourth Sector organizations under existing law and to examine possible characteristics of new hybrid forms (report forthcoming; click here for agenda).

The discussions in these three meetings conveyed broad agreement around several key priorities that need to be addressed in order to create a more enabling legal environment for Fourth Sector organizations:

  1. To capture and disseminate best practices within existing laws to help social entrepreneurs and their attorneys better navigate the hybrid legal landscape.
  2. To explore modifications to existing laws to better accommodate hybrid activity.
  3. To explore the need for new types of legal structures and IRS classification(s) that are tailored to the particular needs of hybrid enterprises.
  4. To develop capacity to support collaboration, knowledge sharing and networking among the Fourth Sector legal community.

The Fourth Sector Legal Strategy Group has been formed in order to address these needs, and in response to the growing importance of the public policy dimensions of Fourth Sector activity.

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Legal Strategy Group (LSG)

Featured Profile

Rob Wexler

Robert Wexler is a Principal with the San Francisco law firm of Adler & Colvin, a firm that specializes in the representation of nonprofit organizations and their donors, with an emphasis on tax and corporate matters. His practice focuses on private foundation grant making, program related investments, representing social enterprises, and unrelated business income tax issues, in addition to the full range of other issues affecting public charities and private foundations. He received his undergraduate degree, magna cum laude, Phi Beta Kappa, from Brown University in 1982. He received his law degree from Columbia University in 1985. Mr. Wexler is a Lecturer in Law at Stanford Law School, where he teaches the Law of Nonprofit Organizations. He has also taught courses at the University of San Francisco and in the LLM program at Golden Gate University. He is an Advisory Board member of NYU’s National Center for Law and Philanthropy. He has served as a board member and officer on nonprofit boards, and he has been actively involved in the Volunteer Legal Services Program of the Bar Association of San Francisco. Mr. Wexler is a contributing author to CEB’s text Advising California Nonprofit Corporations. His most recently published articles include: “Social Enterprise – a Legal Context” Exempt Organizations Tax Review (December, 2006), “Two Key Revenue Rulings Provide a Road Map for Private Foundation Terminations,” Journal of Taxation (2003). Mr. Wexler is a member of the American Bar Association, and an active participant of the Tax Section’s Exempt Organization Committee, where he currently serves as Co-Chair, Sub-Committee on Unrelated Business Income Activities.

email: wexler@adlercolvin.com