Everyone loves to support a good cause, perhaps by contributing to a mission or a charity. Numerous companies actually include some sort of mission work in their business plan. Consider Goodwill. Their mission is to improve the dignity and quality of life of individuals and families by eliminating barriers to opportunity. By helping people reach their full potential, communities are strengthened. With Goodwill’s help, many people are able to realize their dreams through learning and the power of work.
Upon completion of any purchase at Goodwill, the cashier will tell you, “thank you for supporting the Goodwill mission.” Besides finding clothes or other items for pennies on the dollar, people can enjoy shopping at Goodwill because they know that their money is going to help others find work.
This session, I authored House Bill 1015, which allows businesses to incorporate as a “benefit corporation” under Indiana law. Simply put, benefit corporations are people helping people, and they are for-profit companies that have a stated mission embedded in their Articles of Incorporation which require the company to pursue a general public benefit in addition to pursuing profit.
As the company grows, a benefit corporation cannot be stripped of its mission objectives by new investors or even after going public. While traditional business law sometimes requires directors of a business to focus exclusively on maximizing profits, a benefit corporation is required to consider the impact of its decisions on its overall mission and other stakeholders, including its employees and community, all while pursuing profit.
Benefit corporations are required to produce an annual benefit report, proving that they are meeting their mission objectives. Officers and board members of benefit corporations have the understanding that while their company is still seeking to earn maximum profit, they cannot forsake their stated mission. By working to achieve both social and business goals, benefit corporations aim to do well financially while also doing good for the community.
Public service is grounded in the hope of improving people’s lives. If we can use the power of the private sector – the power of capitalism – rather than government to improve many of society’s problems, we open up new opportunities to accomplish great work for society without the heavy hand of government.
Indiana can create a climate where businesses are able to both thrive and give back to the community. Welcoming benefit corporations to our state is an excellent way to continue building that climate.
Rep. Cox serves a portion of Allen County.