Delaware Public Benefit Corporations:

• Enjoy advantages applicable to Delaware corporations generally;
• Protect boards of directors and management of corporations pursuing one or more enumerated publicly beneficial purposes;
• Provide boards of directors and management ability to adjust weighting of social and profit maximization focus to account for changing circumstances;
• Have mandatory reporting requirements that will provide some measure of accountability and certainty for mission to investors and strategic partners;
• Highlight and brand an organization as having a publicly beneficial purpose in addition to the maximization of profits;
• Provide shareholders with say in determining mission of entity;
• May provide access to information to third parties, consumers, strategic partners, investors and others whose interests are aligned with the corporation’s charitable or public purposes;
• Are substantially similar to the Social Purpose Corporation in California; 

 BUT:

• The same disadvantages applicable to corporations generally also apply to Public Benefit Corporations;
• Must comply with potentially time-consuming and costly additional annual reporting requirements related to public benefit or benefits;
• Public Benefit Corporations are a new form of corporation and potential impact on capital raising is still unclear;
• It may be difficult for a corporation with numerous shareholders to transition to/from status as Public Benefit Corporations because of approval requirements and dissenters’ rights;
• Public Benefit Corporations acting as an acquirer of a non-Public Benefit Corporation in a merger or acquisition must obtain two-thirds approval of the outstanding stock of the corporation entitled to vote thereon;
• Public Benefit Corporations acting as a target company in a merger or acquisition with a non-Public Benefit Corporation acquirer must obtain the approval of two-thirds of the outstanding stock of the corporation entitled to vote thereon;
• Effect of Public Benefit Corporation's status is unclear on valuation in public markets and reporting requirements of a Public Benefit Corporation are not entirely reconciled with those required by the U.S. Securities and Exchange Commission for a public reporting company;
• Public Benefit Corporation is confused with the “Benefit Corporations” in other states despite significant differences;
• A “public benefit corporation” in other states (like California) is a type of non profit corporate entity leading to further confusion.

Download guidance about setting up a Delaware Public Benefit Corporation