What is the Difference Between a B Corporation and a Benefit Corporation?
B Revolution founder Dirk Sampselle, JD, MBA, is an expert in B Corporations. Here, he explains the difference between a certified B Corporation and a Benefit Corporation legal entity. Dirk discusses that a third-party entity called B Lab certifies companies as B Corporations based on an impact assessment, whereas Benefit Corporations are a legal entity, with enabling legislation passed in over 20 jurisdictions. While B Corporations do represent a legal structure, it is important to understand how and legal entity interact.
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Unrivaled B Corporation Expertise
B Revolution prides itself on being the world’s leading B Corporation compliance firm, founded by the drafting author of B Lab’s White Paper and nationally recognized expert in the B Corporation certification and legal structure. Our longstanding expertise and experience in helping companies achieve certification means that our clients achieve certification more quickly, at less expense, and with better results than companies who attempt certification on their own. Indeed, because the B Corporation certification process is robust, of the companies that undertake the performance assessment on their own, only approximately 5% achieve certification. (Read more about why here)
Unrivaled Expertise in the Benefit Corporation Legal Entity
In 2010, B Revolution Founder Dirk Sampselle drafted the legislative memorandum used to advocate for the entity’s adoption, which has occurred now in nearly half of the United States. The central thesis for what has become one of the fastest-spreading legislative movements in the history of corporate governance and entity structure has been that, for the past several decades, entrepreneurs and investors have been constrained by the “profit maximization norm,” which requires ventures to focus narrowly on profit creation rather than value creation. The benefit corporation legal entity frees entrepreneurs to make values-based decisions, benefitting stakeholders alongside shareholders in what has been dubbed the “shared value” approach to competitive strategy.
Creating your B Corp Legal Entity, Purpose Structure, and Capital Structure
B Revolution assists clients with selecting the appropriate legal entity, creating the appropriate purpose structure, and negotiating key terms with investors and among shareholders. Where appropriate we also assist with complex structures, such as non-profit/for-profit Joint Ventures, exempt entity formations for charities and foundations, and parent-subsidiary and licensing relationships. B Revolution assists clients throughout the lifecycle of the business, assisting with employment, IP, capitalization, securities, contract, and other critical issues throughout venture development.
New Entity Formation costs vary by jurisdiction, but typically range between $1500-3500 for a comprehensive package that typically includes some or all of:
- Choice of Jurisdiction Analysis
- Choice of Entity Analysis
- B Corporation-Compliant Entity Formation and Filing
- Public Benefit Purpose Definition Exercises
- Authoring of Purpose Provisions and Creation of Purpose Structure
- Counsel on Board Meeting Process
- Compliance Training
- Selection of Indemnification Provisions
- Shareholder Agreement
- Share Subscription Agreements
- Share Certificates
For new venture formations, visit our B Corp Legal Formation Services page.
For existing business transitioning entity solutions, visit our B Corp Legal Transition Services page.