Recent Developments and Future Directions
Edited by Myles McGregor-Lowndes and Kerry O’Halloran
Chapter 6: Holding the Line: Regulatory Challenges in Ireland and England when Business and Charity Collide
Oonagh B. Breen1 INTRODUCTION The debate on the legitimacy of charity involvement in business activities is not new. Regardless of legal jurisdiction, similar perennial concerns regarding the mingling of the nonprofit and for-profit spheres predominate. There are advocates on both sides of the charity–business divide who argue for a complete separation of the two spheres from one another. Those concerned with the purity of charitable mission argue that forays by charities into the world of commercial activity constitute an unwarranted distraction from the focus on achievement of charitable purpose.2 Given the risk involved with any profit-maximising venture, unregulated charitable trading has the ability to threaten the security of a charity’s assets. On the business side of the line, the ability of charities to compete with for-profit entities also raises the ire of private firms. The argument is made that charities engaged in trade enjoy an unfair advantage over their for-profit counterparts because of the corporate and other tax exemptions afforded to charities. Thus, it is said that charitable forays into the business sector, if not prohibited or at least regulated, unfairly distort competition in the market place. The state, too, has an iron in this particular fire since the loss of any revenue caused by such trading, particularly when it is at the expense of tax-paying private enterprises, results in a net loss to the treasury. And yet, there are many examples of increasing collaboration between for-profit and nonprofit entities and incursions by both into the other’s territory. No...
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