A benefit corporation is a class of corporation that voluntarily meets higher standards of corporate purpose, accountability and transparency. The nonprofit B Lab certifies some benefit corporations; a corporation certified by B Lab is called a “B Corp.”
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The major characteristics of the benefit corporation form are: 1) a requirement that a benefit corporation must have a corporate purpose to create a material positive impact on society and the environment; 2) an expansion of the duties of directors to require consideration of non-financial stakeholders as well as the financial interests of shareholders; and 3) an obligation to report on its overall social and environmental performance using a comprehensive, credible, independent and transparent third-party standard. The enacting state’s benefit corporation statutes are placed within existing state corporation codes so that the enacting state’s existing corporation code applies to benefit corporations in every respect except those explicit provisions unique in the benefit corporation form.