You may have heard of a new social impact business designation coming to British Columbia. Well, it’s now becoming a reality.
On June 24th, BC Registries & Online Services hosted an online info session to announce the coming of a new type of corporate designation, scheduled for June 30th.
This will be the beginning of what they call a Benefit Company. These will be a corporation, not unlike what you would typically expect in BC, but with several other provisions and reporting to promote its focus on a public benefit.
The info session combined the announcement of this amendment to the BC Business Corporations Act, while also providing a demo of the new online platform that individuals may use to incorporate a Benefit Company. The new platform made it look incredibly easy, but as they suggested, professional legal guidance is always recommended if you’re unsure about any aspect.
If you missed the session, here’s a quick recap of what you need to know.
Highlights from the Session:
- A Benefit Company is an incorporated organization in British Columbia that has a benefit statement in its notice of articles, including commitment to one or more public benefits.
- The purpose of this designation is to provide evidence to the public of your company’s focus on public benefit. An additional benefit may come from legal protection when making business decisions that favour your public benefit over shareholder gain.
- Benefit Companies are required to report, annually and publicly, their progress and measurement toward their public benefit.
- Benefit Companies are also required to provide assessment against a third-party standard that indicate measurement of progress toward their public benefit. (B Lab’s B Corporation), Ceres, or Global Reporting Initiatives were examples given.)
- Filing costs are around $350, while converting a standard corporation to a Benefit Company will cost you around $100.
Who Will Become a Benefit Company?
It will be interesting to see how many businesses jump on this opportunity and how many will pass on the extra paperwork. One of the benefits is to help inform the public of your focus, though the fact that it requires you to already pursue something like a B Corp certificate, it brings us to question whether this will be worthwhile. This is because a B Corp status is already providing companies with a public label and recognition that is more widely recognized.
Regardless of the outcome, hats off to our provincial government to continue encouraging this type of positive business behaviour. If there were monetary incentives or other significant business cases to becoming a Benefit Company, this change might be able to encourage standard corporations to make a shift. However, the way it stands, it’s more likely that businesses that are already purpose-driven will be the ones pursuing this.
More Info About Benefit Companies
For more information about Benefit Companies, visit https://www2.gov.bc.ca/gov/content/employment-business/business/bc-companies/benefit-company
Feature Image by Lee Robinson