Publications from the N-EXTLAW Team

See all publications, working papers and blogs produced by the N-EXTLAW Team below.

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Experimental Regulation for Social Innovations

Marlie Janssens

N-EXTLAW Working Paper Series, no. 1 (2/2022)

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Abstract: The current economic model is damaging the social and environmental resources it relies on. This extractive model is structured by a legal system which overly focuses on economic growth instead of social and sustainable purposes. Where a legal system is based on competition and controlling organizations driven by short-term profits, organizations which tend to pursue positive contributions in the long-term experience obstructions. This paper takes social innovations as a starting point and explores how unnecessary regulatory burdens can be removed for this type of social innovation through experimental regulation.
Currently, various experimental regulations already exist in Dutch law, but often with the purpose of stimulating technological innovation.  In this paper, the focus lies on developing legal experiments that stimulate social innovation. As such, existing experimental regulations that support technological innovation are taken as a starting point, with the aim of broadening their scope to include social innovation. First, in section 2, two types of regulatory experiments and their functions will be discussed. This section will demonstrate the idea of experimental regulation for fostering technological innovation and provide a brief overview of the advantages and disadvantages of experimental regulation. In this context, it is relevant to take a closer look at the methodology of experimental legal regimes. Section 3 then argues to broaden experimental regulation to social innovations and shows how this relates to existing experimental regulation, with its advantages and disadvantages. The section also consists of other suggestions for stimulating social innovations.
Taking the Green Transition Seriously: A Proposal for a ‘Transition Reserve’ 
Enabling Transition of Large Emitters in the Netherlands 

Prof. dr. Marija Bartl and mr. drs. Nena van der Horst

N-EXTLAW Working Paper Series, no. 1 (1/2022)

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Abstract: Large emitters, more so than any other company, are exposed to the risk of transition. If they do not transition, they will end up with unsustainable business models and stranded assets in the not-so-distant future, eventually going bankrupt as a result. One would hope that large emitters would take this risk seriously and invest into their own transition - but this is not necessarily the case. The incentives inherent in the contemporary model of financial markets and corporate governance,  alongside the possibility of public ‘bail out’, motivate companies to distribute their funds to shareholders or managers instead of investing into the green transition. In this short note, we propose to introduce two new legal obligations for large emitters, both aimed at ensuring that these companies do their part in the transition. First, we argue that large emitters should be required to keep enough money on their accounts to actually be able to pay for the costs of the transition. In order to achieve that, we propose to introduce a legal requirement to establish a new mandatory reserve: a transition reserve.  Second, we argue that the best way to establish the height of such reserves, as well as outline necessary steps toward such transition, is to formalize transition investment plans. We make some suggestions as to how to formalize these transition investment plans in law, building on the current developments at national and EU level around such plans.
‘Levelling the Playing Field: Making the BVm Viable’

Zafar Shaikhli 

Read the full blog here.

In this blog, Zafar discusses the uneven playing field between social and commercial enterprises due to the difficulties social enterprises face when attracting financing. Examining the Dutch BVm proposal and its lack of incentives, Zafar looks at other attempts to stimulate social enterprise financing within the UK, Italy and the Netherlands and proposes to modify the BVm proposal by banning the possibility of converting a BVm to a BV and instating hard requirements regarding profit distribution.
From an Extractive to a Non-Extractive Economy: Disentangling the Building Blocks of Non- Extractive Economic Practices 

Kinanya Pijl (University of Amsterdam) 

University of Oslo Faculty of Law Research Paper No. 2022-39 International and Comparative Corporate Law Journal, Volume 15, 2022, Issue 2, p. 13-34 

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Abstract: The paradigm of contemporary business is extractive: oriented towards extracting ever more unpaid energy, resources, money, personal data, labour, health and well-being from people and from places. Extractivism reduces life into objects for the use of others as a source of profit, giving them no integrity or value of their own, turning living complex ecosystems into “natural resources”. Collectively, these dynamics expel people from economies and societies. The climate crisis, equity crisis and crisis of the natural world challenge the validity of the supposed “proper way of running an economy” that underlies the extractive capitalism in which – one way or another – we are all collectively trapped. But what should extractive capitalism be replaced with? We use the concept of non-extractiveness to capture the essence of a just economy, consisting of economic practices that are distributive and (re)generative by design – rather than depleting – of the very resources they depend on. A multitude of entrepreneurs around the world, such as Buurtzorg and Triodos Bank, are already experimenting with economic practices and organizational designs that serve to positively contribute to social, environmental and cultural change. In effect, they are experimenting with practical ways to reimagine extractive capitalism so that it works for all the members of society and our planet. This paper builds on the premise that these organisations may hold the key to deep societal transformation towards a non-extractive economy. This paper articulates the various ways in which organisations can be designed for non-extractiveness, focusing on the organisation’s purpose, revenue model, legal structure, internal distribution of benefits, internal distribution of decision-making power, culture, and environmental and societal impacts. A deep understanding of the various ways these organisations can be non-extractive can inspire lawyers to ensure that law is designed in such a way as to facilitate people and planet thriving in balance.

Keywords: regenerative business models; sustainable economy; corporate purpose; corporate governance; measuring impact 
Reimagining Extractive Capitalism: Learning from Italy’s Banca di Credito Cooperativo

Laetitia Bornscheuer & Kinanya Pijl

Read the full blog here (on the Transformative Private Law Blog)

In this blog, Laetitia and Kinanya take Italy’s Banca di Credito Cooperativo (location Valdarno Fiorentino) as an example of a non-extractive economic practice and discuss the various ways it demonstrates how we can reimagine capitalism and transition towards a non-extractive economy. Through an exploration of the importance of the mutuality principle, community-centricity and pursuit of social inclusion within Banca di Credito Cooperativo, Laetitia and Kinanya discuss how BCC operates as a socially and environmentally sustainable bank and how this may serve more widely as inspiration for rethinking both the purpose and meaning of banking within society.
Discussing the Benefits and Challenges of Working with Participatory Action Research (PAR): Reflections from N-EXTLAW’s PAR Workshop

Amy Lazell & Laetitia Bornscheuer

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In July 2021, N-EXTLAW hosted an online workshop on Participatory Action Research, ‘Understanding, applying and experiencing Participatory Action Research (PAR): A cross-disciplinary conversation’. This blog post reflects upon the presentations given in this workshop and the key comments and discussions which arose out of them. It will first provide a brief overview of PAR and why this methodology has been adopted within the N-EXTLAW project, followed by an outline of the workshop’s goals and participants. Each of the two panels will then be considered individually, with a final comment on the overall reflections and N-EXTLAW’s future plans for collaboration.