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    The Rise of Benefit Corporations and Market Benefits

    The Rise of Benefit Corporations and Market Benefits

    Why do we need Benefit Corporations?

    Since the dawn of the new century, the world has been struggling to alleviate the severe consequences of the environmental degradation, the global financial crisis and public discontent. The awareness that the current economy model is not sustainable has led to the inception of a new alternative business model called the Benefit Corporation.

    This new promising alternative is galloping to replace the current profits-über-alles model. The benefit corporation has already been authorized as a type of for profit corporate entity by thirty U.S. states and by Italy that is the first European country that makes this legal status available on its entire territory.

    The purpose of a benefit corporation is to redirect a profit driven operation mode of the business enterprise to a general public benefit operation mode that makes positive impact on both society and environment. A benefit corporation model regards the stakeholders’ interest as the one of paramount importance for its long run success and its aim is to forge the trustful and long lasting relationships with its stakeholders.

    How do Benefit Corporations affect the market?

    The neoliberal financial market model has started to decay after the global financial crisis hit the world in 2008. The race for profit maximization at the expense of environmental and social good has proved to be unsustainable and unbalanced.

    A new type of for-benefit organization-a benefit corporation-can be the new engine of reformed capitalism that will balance environmental, social, and economic performance. The radical change in the way that capital markets work is fundamental tool to address current most pressing issues that can endanger the future of humanity.

    It is more than obvious that the recovery of economy and capital markets cannot occur without a crucial change in organizational structure of for-profits organizations.

    The benefit corporations along with the implementation of CSR in the existing for-profit organizations can aid the evolvement of the current global market and bring the whole world to take the right path towards prosperity.



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