Fortune 500 Companies Granted Permission to "Do Good"
DOVER, Del. - Businesses that want to do more than just make money for shareholders now have legal permission to do so in Delaware, which is home to more than one million companies, and to two-thirds of all Fortune 500 companies. "Benefit corporation" legislation was just signed by Delaware Governor Jack Markell.
According to Deb Nelson, executive director of the Social Venture Network, the law protects companies that focus on serving their employees, their communities and the environment, while also turning a profit.
"In the past, many business owners have feared, with reason, that they could get sued by their shareholders if they didn't make choices that only focused on benefiting their shareholders," Nelson said.
"Benefit corporation" laws are on the books in 18 states, including New York.
Mike Hannigan, president of Give Something Back Office Supplies, said Delaware joining the list of "B-Corp" states is a turning point in changing the capitalistic business model.
"What we're all doing comes out of a sense that things aren't working properly," Hannigan declared. "Despite the work of the nonprofit sector, despite the role of government, despite the commitment of businesses, still so many people are left behind in this wealthy country we live in."
Half of all U.S. public companies are headquartered or registered in Delaware, even though thousands operate in other states.