On July 1, 2011, Virginia began allowing the creation of benefit corporations. This benefit corporation classification allows companies to focus their efforts toward non-financial benefits, such as community and societal considerations and the corporation’s impact on the environment. Within the past three years, approximately 20 states have passed benefit corporation legislation. Maryland was the first state to approve the benefit corporation classification. Eight other states, including West Virginia and North Carolina, are considering benefit corporation legislation.
Virginia’s approval of this so-called “B-Corp” status allows company officers, directors and board members the opportunity to impact more than just shareholders’ bottom lines and to have a wider impact on society. Shareholders are also empowered to further the B-Corporation’s cause by bringing proceedings against the company’s leadership for failing to further the company’s focus on the identified benefit. Registered Virginia corporations even have the option to convert to a B-Corporation from a traditional corporation. Virginia is making efforts to highlight this new business classification to draw companies to the Commonwealth.