A bill has been signed into law that brings public benefit corporations to Minnesota. The public benefit corporation is a relatively recent legal innovation that occupies a hybrid position between a traditional corporation and a non-profit corporation. A public benefit corporation requires directors to consider the impacts of corporate action on either all stakeholders in general or on a specific group of stakeholders, in addition to merely considering the impact on shareholders. At the same time, a public benefit corporation operates for profit and can confer pecuniary gain upon its shareholders (something not possible in a non-profit corporation). While these effects can be achieved through contractual modifications under current law, the proposed legislation provides a formal and standard model for such enterprises and allows them to be easily distinguished by consumers and commercial partners from traditional for-profit corporations.
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