A Social Benefit Corporation is an organization that is approved by 35 states (counting the District of Columbia) that advocates for positive change. They typically advocate for positive change for society, workers, the community, and the environment. They are ordinarily for-benefit. They as a rule address concerns held by business visionaries that need to develop their business without the stress of losing control of the natural and social missions of their organizations. Some examples of such organizations are Patagonia, Method, and King Arthur Flour.
In 2010, Maryland passed a law that allowed these Social Benefit Corporations to exist. Following this action, thirty other states passed legislation that allowed these corporations to rise. Since then, roughly 5400 total companies aligned themselves as Social Benefit Corporations, according to a 2018 study held by SocEntPolicy. A major reason why many of these companies choose to align themselves with the name of Benefit Corporations is that they fancy the idea of staying for-profit, but still supporting environmental efficiency. For many of them, the order of importance is the sense of community, money second, accountability, and attracting the right people.
A big thing to remember when addressing the ways that these corporations attain their revenue is that many of them are for-profit meaning that they make money by selling products. However, what they do with their revenue is different than some major corporations. In example, Patagonia is a clothing brand, but it gave its $10 million tax cut back to environmental organizations. Patagonia is a for-profit clothing corporation that goes under the name of B-Corporation so that it can give back. Patagonia is one of many examples of for-profit Social Benefit Corporations. However, some Benefit Corporations can fit under the name of nonprofit.
Benefit Corporations all have one major thing in common; they raise money for certain missions and causes. The main cause of a Benefit Corporation is to address social and environmental problems and put some of their revenue into solving those problems. Some of the examples of Benefit Corporations missions are giving back to local communities, creating community creative projects, ensuring public transparency, ensuring environmental performance, and inspiring connections and community among all others.
Most of these corporations sell products for their revenue. Some examples of products being sold by Benefit Corporations are community projects, clothing, baked goods, education, and services to name a few. These corporations range from many different backgrounds and many different industries. These industries can range from retail to manufacturing to food and beverage production. They all sell a certain product and use the revenue that they gain to help the world around them.
