# Public benefit corporation (PBC)

> A for-profit corporation with a public benefit in its charter and a board bound to balance it — taxed like any corporation.

Source: https://lopifi.com/learn/business-entity-types-explained/public-benefit-corporation
Part of: Lopifi — US GAAP books on autopilot, checked by a CPA (https://lopifi.com)

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**What is a public benefit corporation?** A for-profit corporation with a public benefit in its charter and a board bound to balance it — taxed like any corporation.

A [public benefit corporation](https://lopifi.com/md/glossary/public-benefit-corporation) is a for-profit corporation whose charter names a public benefit, and whose board must balance the stockholders' financial interests against that benefit and the interests of the people its conduct affects. It reports to stockholders on the benefit at least every two years.

> “A “public benefit corporation” is a for-profit corporation organized under and subject to the requirements of this chapter that is intended to produce a public benefit or public benefits and to operate in a responsible and sustainable manner.”

— [8 Del. C. §362(a)](https://delcode.delaware.gov/title8/c001/sc15/index.html), Public benefit corporations, and the biennial statement §366(b) requires

For tax it is a corporation like any other: a C corporation filing Form 1120 unless it elects S status. The mission changes the board's duties, not the return. Nor is it a certified "B Corp", which is a private certification any entity type can seek.

**Public benefit corporation**
- Pro: The mission is a legal duty, not a slogan.
- Pro: Raises money and grants options like any corporation.
- Con: A benefit statement to stockholders at least every two years.
- Con: The board's balancing duty applies to every decision, a sale included.
- Best for: A venture-backed company that wants its mission in its charter.

**Ordinary C corporation**
- Pro: The default every investor document assumes.
- Con: The mission lives in policy, not the charter.
- Best for: Most startups.

A PBC against an ordinary C corporation.

## Where this page's rules come from

- [8 Del. C. §362(a)](https://delcode.delaware.gov/title8/c001/sc15/index.html) — Public benefit corporations, and the biennial statement §366(b) requires (state)
- [Wikipedia, “Benefit corporation”](https://en.wikipedia.org/wiki/Benefit_corporation) — Benefit corporation (reference)

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