The Benefit Corporation

5 Responses to The Benefit Corporation

1. Robb Allen says:

   July 8, 2010 at 1:33 pm

   Social responsibility?

   Please. If people value a company because it plants trees and requires its employees to use mass transit and drink from recycled paper cups, then they will do so by purchasing their goods and services.

   A company does well when people purchase their product. A company does poorly when they do not. You cannot change that by saying a company does good when they consider the impact on the environment. If that happens to entice people to pay for their stuff, then that’s great and more power to them. But in and of itself, it’s a useless gesture.
2. Robb Allen says:

   July 8, 2010 at 2:05 pm

   Let me try stating this again – If a company wishes to be legally held to a specific set of goals – make a profit, reduce energy consumption, recycle 80% of office supplies – then I’m 100% behind them.

   Volunteering to enter into an agreement, regardless of if I think the foundation of said agreement is a sound idea, is completely fine with me.

   If a company wishes to denote that it answers to more than just the bottom line, as long as they can find suckers with more money than brains investors, then more power to them and I wholeheartedly support the push.

   However, mark my words – just like the vast majority of ‘green’ anything, they’ll be told that ‘yes, we’ve cut our trash down by 30% but it cost you X% of your EPS’ and the CEO will simply pocket the cash. When you promise someone that they’re going to make less money, they’re going to make less money.
3. Mad Rocket Scientist says:

   July 9, 2010 at 5:36 am

   But at least they are upfront about it. If a corporation is really just a group of people gathered together for a common goal, then why should the only stated goal be to make piles & piles of money?

   I can see how this option would be attractive. Say you start a company refurbishing old guns, and, as a private owner, you have a passion for making sure there are adequate shooting ranges in any given area (and to prevent Sarah Brady from closing them down). So you spend some money from the corporate profits to build new ranges.

   Now, you want have a growing population of customers who want you to refurb their H&Ks, so you need to raise capital to be able to afford having all those pricey spare parts on hand. You decide the become a benefit corp, and one of the benefit corps stated goals is to spend 15% of annual profits on building new ranges (because let’s face it, ranges are a public benefit).

   As a guy who enjoys shooting, and is frustrated that there is only one shooting range close to my house, I would be inclined to give you my business because I know that even in lean times, you will be using 15% of your profits to build ranges, and not letting that goal slide in order to satisfy shareholders.
4. Robb Allen says:

   July 9, 2010 at 3:20 pm

   I agree, like I said as long as the investors are on board with it, then I have no objections outside of the term ‘social responsibility’.
5. Mad Rocket Scientist says:

   July 9, 2010 at 8:11 pm

   Fine, replace social responsibility with public benefit.

   Sheesh, picky picky 😉

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