Business Bellwether Delaware Approves Benefit Corporations

Delaware is the latest state to authorize the creation of “benefit corporations” legally authorized to pursue social goals as well as profitability, a potentially major step in the movement for mission-conscious business, according to The Wall Street Journal and Forbes.

A benefit-corporation bill approved earlier this year by the state legislature was signed into law Wednesday by Gov. Jack Markell. Delaware is the 19th state to take that step, but as the home of more than 1 million companies, including half of the country’s publicly traded firms, it is widely viewed as setting the bar for corporate law.

The new status allows company directors, and in some states executives, to consider a firm’s social mission as well as shareholders’ financial interests in making business decisions. Delaware’s law takes effect Aug. 1.