South Carolina Articles of Incorporation Benefit Corporation (SCA OBC) is a type of business structure specifically designed to provide companies with the legal ability to pursue social and environmental objectives alongside their traditional financial goals. SCA OBC is a form of corporate entity that requires the company to adopt a special statement of purpose, which includes creating a positive impact on society and the environment. Additionally, the corporation must consider the interests of stakeholders such as employees, suppliers, customers, community, and the environment when making decisions. There are two types of SCA OBC: 1) General Benefit Corporation and 2) Public Benefit Corporation. The General Benefit Corporation is a for-profit entity and the Public Benefit Corporation is a not-for-profit entity. The benefits of both types of SCA OBC include protection for directors and officers from personal liability for corporate decisions related to social and environmental objectives, increased flexibility in decision-making, and access to potential sources of capital.
South Carolina Articles of Incorporation Benefit Corporation
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FAQ
What Are South Carolina Articles of Incorporation? Preparing and filing your articles of incorporation is the first step in starting your business corporation. Approval of this document secures your corporate name and creates the legal entity of the corporation.
A Benefit Corporation is a corporate form designed for for-profit entities that want to consider society and the environment in addition to profit in their decision making process. Benefit corporations are different from traditional corporations in regards to their purpose, accountability and transparency.
Benefit Corporations afford legal protection to companies that prioritize social and environmental values over shareholder returns. In other words, Benefit Corporation status allows directors and officers to balance financial and nonfinancial interests when making business decisions.
To register as a benefit corporation, you must file the Articles of Incorporation with the Secretary of State, along with the prescribed filing fees. As of now, you can form a benefit corporation in 27 states. However, more states are likely to enact the statute for benefit corporations in the coming years.
Accountability and transparency. Due to factors such as its public benefit purpose and legislated reporting requirements, a PBC provides the socially conscious investor or consumer with an enhanced level of accountability and transparency, which often adds to its overall appeal.
benefit corporation has the same structure as a traditional forprofit corporation. Each has a board of directors, officers, and shareholders who own shares in the company. The officers and directors run the business, yet the shareholders can hold them accountable for the decisions they make.
Disadvantages of Benefit Corporations Not available in every state: Not every state recognizes benefit corporations.Not available for every business: Not every type of business can register as a benefit corporation.Less profit: In some cases, promoting the public good means less profit for your shareholders.
Unlike a traditional corporation, a Benefit Corporation is a for-profit corporate entity type that is not solely profit-driven. A Benefit Corporation must have a beneficial social or environmental purpose and meet increased levels of accountability and transparency.