Why We Love Being a Public Benefit Company
Back when we were forming the idea for Yoga Therapy Link, we were reading A Force for Good: The Dalai Lama's Vision for Our World written by Daniel Goleman. It was there that we first learned about B Corporations and how they are transforming business.
A “B Corp,” as they are often called, is a for-profit corporation certified by the nonprofit organization B Lab as a corporation that meets higher standards of transparency, accountability, and performance. According to B Lab, “B Corps are accelerating a global culture shift to redefine success in business and build a more inclusive and sustainable economy.” Immediately, we knew: this is where our heart is.
We were starting our own small business and we wanted to have the same high standards.
So we began to research what it takes to become a B Corporation. Some well-known B Corporations that you may know are Banyan Botanicals, Patagonia, Athleta, Pukka Herbs, and Ben & Jerry’s. We love these businesses, and we love this movement! The thing was, and still is, that we’re just two Yoga Therapists who want to help other Yoga Therapists connect with as many people and communities as possible. We have big goals and a great work ethic, but we don’t have the resources to set up as a B Corporation.
That’s right, it costs money. Quite a bit. And it should! B Lab sends auditors out to these businesses to make sure that they are upholding the claims they make to be a certified B-Corp. Each company has to pay for the initial registration, and then continue to pay each year for re-certification. And that’s something that we just couldn’t do, not to start.
So we kept looking for ways to form a business that aligned with the same standards and values.
Eventually, we discovered a corporate entity called a public benefit corporation. This is an actual statutory entity type (like S-corp, C-corp, LLC, etc.) that is registered with a state. The public benefit corporation does not go through B Lab certification or pay B Lab fees, but it does allow for-profit businesses to be driven by a social mission. In other words, public benefit corporations, just like B Corporations, commit to operating their business for the good of others, responsibly and sustainably.
Benefit corporations spread quickly starting with Maryland in 2010 and then to over 30 states by 2018. For a purpose-driven social enterprise, the public benefit corporation provides a legal framework that refocuses conventional corporate law from the narrow focus on shareholder benefit to the broader focus on public benefit. By forming a benefit corporation, social enterprises can promote the interests of non-shareholders such as the public, the environment, or a particular group they want to help, while pursuing corporate well-being responsibly and sustainably.
But again, we are just TWO Yoga Therapists. So we didn’t need to form a whole big corporation. Still, we loved this movement and we wanted as yoga therapists to be a part of it. More research ensued. And lo and behold, yet another new legal entity had sprung up—the public benefit LLC.
To break this down, an LLC is a business form that combines aspects of a corporation and a partnership. (Perfect for two Yoga Therapists!😃) And a public benefit LLC ( PB LLC ), like the B Corp and the benefit corporation, is a business form that is intended to produce a public benefit and operate responsibly and sustainably. Like B Corps, members or managers of a PB LLC are required to manage the company in a way that balances the financial health of the business, the best interests of those materially affected by its conduct, and the specific public benefit that the company puts in writing during formation. So everybody’s interests are at heart, making it a win win win, all around!
One of the other great things about PB companies is that the business must provide its members with a biennial statement as to its promotion of the public benefit set forth in its Certificate of Formation.
This ensures the company is constantly revisiting the reason it began in the first place, keeping it true to its vision and to the public.
As soon as we discovered that the PB LLC entity type existed, we knew it was perfect for us. We have a small business with an incredibly small budget and an unimaginably big heart. So when we filed our Certificate of Formation with the state declaring that Yoga Therapy Link is a public benefit LLC, we promised ourselves and you that our mission is
To produce a public benefit through the responsible and sustainable promotion of Yoga Therapy, by connecting communities with Yoga Therapists who serve them and connecting Yoga Therapists to resources they need to promote their services.
And we plan to keep that promise! Every two years, (maybe even more often if we’re feeling extra productive 😉) we will release a statement of ALL the things we’ve done to keep our promise, and more.
So stay tuned, friends! 💜