When Making Money and Making a Sustainable and Societal Difference Collide: Will Benefit Corporations Succeed or Fail?
22 Pages Posted: 11 Oct 2013
Date Written: October 9, 2013
A quiet, but important, corporate revolution is afoot in the United States. Many of us, laypersons and corporate scholars alike, have not even noticed. A new type of corporate entity has been created-the benefit corporation.
This article explores benefit corporations as a tool entrepreneurs can use to make money, foster environmental sustainability, and create societal improvement. Part I briefly examines who has been advocating for the creation and passage of benefit corporation legislation in the United States. Part II analyzes the statutory requirements to form a benefit corporation. Specifically, Part II discusses the issues of purpose, accountability, transparency, rights of action, and enforcement of those rights in connection with the creation and operation of a benefit corporation. Part III highlights the states that have passed benefit corporation statutes and highlights those considering similar legislation. Part IV examines the pre-existing use of benefit entities, in unincorporated form, through exploration of the benefit certification process. Finally, Part V offers a future prognosis and debates whether benefit corporations will succeed or fail.
Keywords: benefit corporations, sustainability, societial impact, corporations, legislation, accountability, transparency
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