We've all heard tales of corporate greed and misuse of power, but what if we could change that and create a better kind of corporation?
By passing Benefit Corporation legislation, we can. Benefit Corporation legislation would make it easier for businesses to focus on more than just making a profit.
Recently, California Assembly Member Jared Huffman introduced a bill (AB 361) that would create a new form of corporation in California known as a Benefit Corporation. It has passed the Assembly and is now being considered in the Senate.
Current corporate law makes it hard for businesses to consider employee, community, and environmental welfare when making decisions, but new legislation would allow corporations to take all of those aspects into consideration. Benefit Corp laws would also require more transparency, helping the public to more easily see through green-washed advertisements.
We need companies that we can trust to do what's best for everyone, not just their shareholders.
Similar legislation has already passed in four states and is being considered in many others. Tell the California State Senate and Governor Brown to pass AB 361 and keep California at the forefront of sustainable business.
I SUPPORT Benefit Corporation legislation (AB 361-Huffman) and seek your support of the same.
Benefit Corporation legislation creates a new type of corporation that generates benefit for society, in addition to profit for shareholders.
As a citizen and consumer, I want companies to have the legal protection to pursue a higher corporate purpose than simply maximizing shareholder value. These companies should do more than pick a single charity or environmental task to improve their image. Rather, I support those that create high quality jobs and improve life in our communities. Benefit Corporation legislation gives the public the tools needed to distinguish good companies from just good marketing.
Benefit Corporation Legislation also provides additional accountability to shareholders by redefining the fiduciary duty of directors. Directors of Benefit Corporations must consider the impact of their decisions on the long term interests of society, even when considering a sale of the business.
Finally, to ensure increased transparency to shareholders and the public, Benefit Corporations are required to assess their overall social and environmental performance against a third party standard. By doing so, everyone is made aware of the Benefit Corporation's effectiveness relative to independent, credible and transparent standards. This allows for informed decisions about which companies to support.
Benefit Corporation legislation already passed into law in Maryland, Vermont, Virginia and New Jersey, and has been introduced in New York, Pennsylvania, Michigan, North Carolina, and Hawaii. The legislation is progressing rapidly in these states, with strong bi-partisan support, because it's entirely voluntary and has no budget impact.
Please join me to support Benefit Corporation legislation.