ALBANY — A new law for New York authorizes establishment of benefit corporations with a dual focus on social responsibility and profits.
While officers and directors of existing companies are required to pursue profits on behalf of shareholders, sponsors say the new model envisions other fiduciary responsibilities meant to have a positive material impact on society and the environment.
It is meant in part to address concerns among some entrepreneurs who need to raise growth capital but fear losing the social or environmental missions of their business.
The bill will go into effect in 60 days. It unanimously passed the Senate and Assembly and Gov. Andrew Cuomo has signed it.
Supporters say New York is the seventh state to enact the legislation, following Maryland, Vermont, New Jersey, Virginia, Hawaii and California.