Doing Good While Doing Well — Delaware Is the 19th State to Adopt Public Benefit Corporation Law

A new Delaware law authorizing the creation of public benefit corporations (“PBCs”) in Delaware becomes effective on August 1, 2013. PBCs are a new type of socially conscious for profit corporation intended to operate in a responsible and sustainable manner. While PBCs operate on a for profit basis and pay income taxes, they are unique in that they are managed in a manner that balances the pecuniary interests of its stockholders with persons, entities or communities that are materially affected by the corporation’s conduct. Delaware is the 19th state to adopt such legislation.

Businesses that elect public benefit corporation status in Delaware will receive the stability, efficiency and predictability of Delaware law, as well as a way to differentiate their business and transparently report on their social and environmental performance.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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