Very Significantly Different ! - The Public Benefit Corporation and the Benefit Corporation.

TWEET THIS USING THIS SHORT http://goo.gl/aFQQ4q

This is an interesting new development coming out of New Hampshire. When I first saw these words

"Governor Hassan Ceremonially Signs NH Benefit Corporation Act at Badger Balm"-

I thought Uh Oh New Hampshire is now going the way of Maine- but upon further reading I found this was not the case. This is a bill about Benefit Company certification. I think I mostly like it. Over the years of operating as a private enterprise, which has donated to umpteen hundred non-profit causes, I was often offended by non-profits as well - especially when I found them operating in the free market while conducting practices that go against the conventional standards of the free market - and when asked why would  answer such as "because we serve the public good" always with the undertone of "if you are not non-profit then you do not serve the public good" and I know this is not the case. There are plenty of private enterprises, preferring to be part of the free enterprise system , that also have philosophies that serve purposes beyond the sheer profit motive, and yet that is how many portray any enterprise choosing to operate in the private sector and function under free enterprise rules of engagement.

Although government bureaucracies make me wary- this bill stipulates that being granted such a certificate does not mean operating under a special set of rules- It just gives recognition to private businesses that choose to do public good. Who ever came up with the idea that in order to do so, one has to operate under non-profit terms of engagement. That makes no sense!

I like that public benefit is not just deemed by the state legislature as it is in Maine such as when we find written in various charters of state corporations that "

Any benefits accruing to private individuals or associations, as a result of the activities of the authority, are deemed by the Legislature to be incidental to the public purposes to be achieved by the implementation of this chapter.

found in the charter for the  FAME Corporation

New Hampshire's Senate Bill 215 

These are some sections that caught my attention because I find them to be based on sound principals serving the interests of the general public, which is what a state is supposed to do:

III. The existence of a provision of this chapter shall not itself create an implication that a contrary or different rule of law is applicable to a business corporation that is not a benefit corporation. This chapter shall not affect a statute or rule of law that is applicable to a business corporation that is not a benefit corporation.

“General public benefit” means a material positive effect on society and the environment, taken as a whole, assessed against a third-party standard, from the business and operations of a benefit corporation.

XI. “Third-party standard” means a recognized standard for defining, reporting, and assessing corporate social and environmental performance that is:(a) Comprehensive because it assesses the effect of the business and its operations upon the interests listed in RSA 293-C:7, I(a).(b) Developed by an entity that is not controlled by the benefit corporation.(c) Credible because it is developed by an entity that both:(1) Has access to necessary expertise to assess overall corporate social and environmental performance; and(2) Uses a balanced approach to develop the standard, including a reasonable public comment period.(d) Transparent because the following information is publicly available:(1) About the standard:(A) The criteria considered when measuring the overall social and environmental performance of a business.(B) The relative weightings, if any, of those criteria.(2) About the development and revision of the standard:(A) The identity of the directors, officers, material owners, and the governing body of the entity that developed and controls revisions to the standard.(B) The process by which revisions to the standard and changes to the membership of the governing body are made.(C) An accounting of the revenue and sources of financial support for the entity, with sufficient detail to disclose any relationships that could reasonably be considered to present a potential conflict of interest.293-C:3 Incorporation of Benefit Corporation. A benefit corporation shall be incorporated in accordance with RSA 293-A:2.01 through RSA 293-A:2.07, but its articles of incorporation shall also state that it is a benefit corporation.293-C:4 Election of Benefit Corporation Status.

IX. “Specific public benefit” includes:

(a) Providing low-income or underserved individuals or communities with beneficial products or services;(b) Promoting economic opportunity for individuals or communities beyond the creation of jobs in the normal course of business;(c) Protecting or restoring the environment;(d) Improving human health;(e) Promoting the arts, sciences, or advancement of knowledge;(f) Increasing the flow of capital to entities with a purpose to benefit society or the environment; and(g) Conferring any other particular benefit on society or the environment.

Section 293-C:8 The law regulating the Benefit Director

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Very Significantly Different ! - The Public Benefit Corporation and the Benefit Corporation.