The Hubs made a wonderful contribution to The Do-Gooder Mama today. You see, he reads The Wall Street Journal, well, maybe not religiously, or maybe even at all, but he did come across this article that he thought would “speak to me,” and it did. The article, titled, “With New Law, Profits Take a Back Seat” arrived in my inbox at an opportune moment, just as I am preparing to launch a series on Do-Gooder Companies.
Written by Angus Loten, the article is fairly short and easy to read, even for the business and finance illiterate like me. But, since most of you will not click on the link to check it out, I will attempt to provide you with The Reader’s Digest version of the article. Loten reports on a new class of corporations called Benefit Corporations. When a company incorporates as a Benefit Corporation, their governing board may consider social and environmental objectives above profits when making business decisions. This new structure is designed to protect boards from investor lawsuits. Under the law, Benefit Corporations must lay out social and environment goals in their bylaws and publish an annual “benefit report” to determine how well they are meeting those goals.
The article is objective and presents arguments for and against this type of incorporation. Since I have absolutely no credentials to be judging the validity of these arguments, I am going to let the professionals who actually understand the world of finance focus on whether or not this is good for investors. Feel free to thank me for refraining from diving into this discussion in the comments section.
What I am comfortable discussing, is my opinion as a consumer. I am all for the collision of business and social causes and applaud companies who are willing to stand up and say that making a profit and doing good are not mutually exclusive principles. There are plenty of companies that are profitable despite the fact that they choose to hold themselves to higher standards on working conditions for their employees or donate goods or profits in support of a social cause. I do not begrudge these companies for their hefty profits – in fact, I celebrate them. If a company can make a profit, which is, after all, one of the ultimate goals of any company, Benefit Corporation or not, and address a social need, then they have my support. If the Benefit Corporation legislation leads to more companies forming with a focus on both profit and doing good, or if it provides protections for companies already doing so, then I think that is awesome. If it leads to greater reporting on the social and environmental accomplishments of said companies, even better.
So, in sum, I am a consumer and a Do-Gooder. Can I say that all of the money I spend is directed towards companies who share my desire to do good? You bet I CAN’T. Truth is, I try to support Do-Gooder Companies, but I am supremely ill-prepared for this task. I am going to attempt to educate myself on companies that genuinely seek to address a social need while providing a product or service that is in demand. What are your favorite Do-Gooder Companies? Share them in the comments section or on my Facebook Page.