Creating Compliant Board Processes
Each benefit corporation statute requires boards to consider their public benefit purpose in their decision-making process. Most of the statutes also require boards to consider their stakeholders in each board decision. Balancing the public benefit purposes of the corporation with its profit interest, and the interests of the relevant stakeholders, is critical not only to achieving board compliance, but also to achieving optimal profit-impact synergy.
There are several ways in which boards should address compliance, and seek to maximize return on impact:
- Creating Purpose Structure: B Corporation entities are often mandated to have a public benefit purpose. Creating an appropriate definition of such purpose, and building a purpose structure that reflects the owners’ intentions, is key to mitigating litigation risk and ensuring board process will be attuned to serving these ends.
- Identifying Key Stakeholders: Many B Corporation entities are required to consider certain stakeholders. Because stakeholders can also be sources of shared value, Boards should be particularly intentional about identifying, prioritizing, and engaging stakeholders. B Revolution helps clients integrate stakeholder consideration into board process.
- Developing Compliant Monitoring Processes: All corporations have a duty to monitor operations. Under the landmark Delaware case of Stone v. Ritter, this means that Boards have a duty to implement adequate reporting systems and controls to prevent harm to the corporation’s interests, and have a duty to monitor the results of those reporting systems, and oversee that the controls are being implemented. B Revolution helps Boards integrate third-party standard and reporting requirements into board decision-making processes to ensure certification and legal compliance is achieved.
Using Board Process to Mitigate Risk and Maximize Impact
B Revolution counsels Boards of Directors and Executive teams on integrating a profit-impact strategy into board-level decision-making, and achieving ongoing compliance with the relevant benefit corporation statute. In so doing we help Boards address the following concerns:
- How to forecast and predictively manage trade-offs
- Honing the corporation’s public benefit purpose definition
- Translating public benefit purpose into concrete, actionable, board-level strategies
- Identifying, prioritizing, and weighting stakeholder groups based on strategic interests
- Developing and Administering Board Advisory Committees
- Identifying and Training the Public Benefit Director and/or Officer in compliance concerns
- Structuring a compliant Board decision-making process
- Making appropriate record of public benefit considerations
- Using impact tracking and management protocol to guide Board decision-making
- Many other compliance and B Corporation Board concerns