Introduction
Thanks to the benefit scheme, it is possible to pursue, in addition to profit or mutual purposes, also purposes of common benefit. This approach represents an evolution of the concept of enterprise that follows today’s needs and that, if correctly used, can have a strong positive impact on the community. Let’s see what we mean talking about benefit corporations.
What does benefit corporation mean?
Benefit corporations are a legal form of company that was introduced in Italy in 2016 and precisely with the Law 208/2015 (Legge di Stabilità).
Italy was the first country to introduce this innovation, inspired by the United States of America, where benefit corporations have been present since 2010.
The purpose of benefit corporations is to allow a profit-making company to pursue even the common benefit.
The profit-making
In the corporate sphere, profit-making is understood as the purpose of pursuing the profits to be divided among the shareholders through the exercise of a common economic activity.
In our legal system the objective profit purpose is relevant, and can be defined as the use of methods that are objectively aimed at maximizing revenues, in the management of the company.
What does common benefit mean?
Common benefit is the pursuit of a positive effect that has an impact on communities, people, territories, environment, cultural or social assets and activities.
The commitment of benefit companies is to pursue the objectives in a sustainable and transparent way by balancing the interests of partners (to achieve profits) with those of the community.
Characteristics of the benefit corporations
The main characteristics of benefit companies are the following:
- purpose of common benefit: as we have seen, in addition to the traditional social object, benefit companies are committed to pursuing one or more positive effects (or reducing negative effects) on the community and environment. This commitment is expressly stated in the statute.
- accountability and transparency: these companies are required to operate in a responsible, sustainable and transparent way towards people, communities, territory and environment, cultural and social heritage, associations and other stakeholders.
- reporting obligation: the benefit corporations must draw up and publish an annual mission statement, a document describing the actions taken to achieve the common benefit objectives and assessing the impact of the activities carried out.
Which kind of companies can be benefits?
According to the relevant legislation, all the companies provided by the Civil Code can benefit. Therefore, they can be benefits:
- The simple society
- The general partnership
- The limited partnership
- The limited partnership for shares
- The joint stock company
- The limited liability company
Can innovative startups be benefit?
It’s very interesting to understand if innovative startups can be also benefit corporations.
Nothing specific is said by the law in this regard, but there seems to be no doubt about the compatibility between innovative startups and benefit purposes.
As we have seen, the law governing innovative startups requires the form of capital companies or cooperatives. So a benefit company can be registered in the Register of Companies as an innovative startup if it meets the requirements of the law for the latter.
The benefit model, in fact, does not affect the legal form chosen for the company, requiring only some specifications to be made for example in the corporate object.
The corporate object
It is important that the goal of pursuing the common benefit clearly emerges from the social object, which, again, is of particular importance.
It is also useful to remember that, in the event that you decide to make your already established company become a benefit company, you must resort to an amendment of the articles of association, and therefore will be required the necessary formalities indicated by law.
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