It’s generally not a technical limitation. Higher-end compact cameras often use similar underlying technology and do offer manual control, so the lack of M mode on basic compacts is mainly a design and market decision.

Entry-level compact cameras are aimed at people who want a small, inexpensive, simple camera that works automatically with minimal learning. Adding manual controls can make the camera harder to use, and in some cases may require extra interface elements or design compromises that increase cost, size, or complexity.

There’s also product segmentation: users who want manual shutter/aperture/ISO control are often steered toward higher-end compacts or interchangeable-lens cameras, so manufacturers may reserve those features for more advanced models.

Based on the answers provided, there’s no indication that overexposure itself would normally cause “serious damage” to the sensor in ordinary photographic use. The omission of manual controls is presented as a marketing/usability choice rather than a sensor-protection issue.