Thursday, October 20, 2011

The new "Flexible Purpose Corporation" in California

A new interesting development in California, a new corporate structure hybrid has been born: the flexible-purpose corporation, which makes it easier for companies to include social and environmental goals in their business plans alongside the pursuit of profits as reported in the Wall Street Journal Law Blog. As of Jan. 1, 2012, these companies can draft articles of incorporation in such a way that puts a desired social mission alongside financial growth. In particular, questions exist on how these social goals might be measured, but I could see this spawning any number of new approaches and businesses. The key is a regime with empirical information and transparency.


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