Minnesota Enacts Public Benefit Corporation Legislation
Legislation bringing public benefit corporations to Minnesota has been signed into law. 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.
Learn more about the legislation by reading our comprehensive analysis.
To discuss this new law, contact your usual Stinson Leonard Street contact.