California Companies Kick Off 2012 As Benefit Corporations
This week marked the first time California companies could register as a benefit corporation. A dozen CEOs lined up at the California Secretary of State’s Office to become a benefit corporation.
California is the seventh state in the nation to give companies the ability to register as a benefit corporation. Ventura based Patagonia was one of the first companies in California to sign up. Other newly registered B Corps include: DopeHut, Dharma Merchant Services, Give Something Back Office Supplies, Green Retirement Plans, Opticos Designs, Rimon Law, Scientific Certification Systems, Solar Works, Sun Light & Power, Terrassure Sustainable Land & Resource Development, and Thinkshift Communications.
What Is A Benefit Corporation?
Unlike a Corporation or LLC, benefit corporations must consider how business decisions will impact the environment, employees and community in addition to their bottom line. The law reflects a new legal ability for companies to adopt policies that have a material impact on society and the environment, not just shareholders. Under the B Corp legislation, California companies can focus on civic return on investment not just stock portfolios. In other words benefit corporations require companies to have a social consciousness.
Companies who file as a benefit corporation are required to report yearly to the Secretary of State on the work they did for public good. In return, registered benefit corporations will receive tax incentives. Benefit corporations represent a positive step in shifting corporate mentality from profit to people and the planet.