Now this is interesting: Legislation has been introduced in Vermont to create a new kind of corporation. Different from a non-profit, it would provide social good for the community, while returning gains to investors. In a Burlington FreePress article describing this legislation, Seventh Generation co-founder Jeffrey Hollender is quoted as syaing that the bill “provides Vermont with a very unique and important leadership opportunity.”
The FreePress reports that the legislation calls for new and existing for-profit corporations to elect status as a for-benefit corporation with the purpose, among other things, of creating public benefit. The bill, called the Vermont Benefit Corporation Act, defines “public benefit” as “a material positive impact on society and the environment, as measured by a third-party standard, through activities that promote some combination of specific public benefits.”
Will Patten, executive director of Vermont Businesses for Social Responsibility, backs the measure, saying “It’s a no-cost, positive piece of legislation that might have an impact on Vermont’s economy.” Green Mountain Roasters is reportedly a prime candidate to become a benefit corporation, upon approval by two-thirds of shareholders, should the legislation become law. Click here for the complete article.
This kind of hybrid corporation makes good sense in this era of economic and organizational turmoil and change — one that calls for out-of-the-box thinking about ways to combine economic success and service to the common good. Increasingly, economists and others are observing that our institutions and their leadership vision are locked into 20th Century thinking and realities; and that new kinds of thinking and structures are needed to address the complex, interconnected issues facing societies and people today. Harvard’s Umair Haque, among others, has been addressing these issues in his writings.
