What is a Benefit Corporation?

Benefit corporations are a new legal tool to create a solid foundation for long term mission alignment and value creation. It protects mission through capital raises and leadership changes, creates more flexibility when evaluating potential sale and liquidity options, and prepares businesses to lead a mission-driven life post-IPO.

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Why is Benefit Corp Right for Me?

The benefit corporation legal structure supports your mission while you grow your company.

Protect Your Mission

Reduce Liability

Increase Accountability

Attract Talent

Access Capital

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Common Misconceptions

Misconception: Benefit corporations must become Certified B Corps
Misconception: Benefit corporations aren’t profitable
Misconception: Benefit corporations are only small companies or start ups
Misconception: The reporting requirements for benefit corporations are onerous.
Misconception: Benefit corporations and Certified B Corps are the same thing
Misconception: Benefit corporations are non-profits or hybrid entities.

How to Become a Benefit Corporation

New companies can incorporate as a benefit corporation in any state where legislation has been passed. Existing companies can elect to become a benefit corporation by amending their governing documents.

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Reporting Requirements

Benefit Corporation Reporting Requirements

1

A narrative description of pursued general public benefit

2

Assessment of the overall social and environmental performance

3

Name of the benefit director and the benefit officer, if any

4

Name of each person that owns 5% or more of the company's outstanding shares

All benefit corporations are required to create a public benefit report each year. When creating a benefit report, benefit corporations must consult state requirements and choose a third party standard. Learn more about those requirements, along with B Lab’s best practices and examples of published benefit reports.

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Note that in Delaware it does not need to be released to the public or to use a third party standard as an assessment tool, however it is considered best practice to do both.

Are you a start-up?

If you’re starting a new business and have decided the corporate form is right for you, or you’re thinking about raising capital, registering as a benefit corporation at start-up can help you achieve your long-term goals as a mission driven business.

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