Public-Benefit Corporation

David Korten proposed to replace the Private-Benefit Corporation with a new structure that is for public benefit.

Description

1. David Korten:

"The private-benefit corporation is an institution granted a legally protected right--some would claim obligation--to pursue a narrow private interest without regard to broader social and environmental consequences. If it were a real person, it would fit the clinical profile of a sociopath.

The basic design of the Private-Benefit Corporation was created in 1600 when the British crown chartered the British East India Company as what is best described as a legalized criminal syndicate to colonize the resources and economies of distant lands to benefit wealthy investors far removed from the social and environmental consequences. That design has ever since proven highly effective in advancing the private interests of the world's wealthiest people at enormous cost to the rest.

The private-benefit corporation uses its economic power to privatize (internalize) gains and socialize (externalize) cost. The resulting concentration of wealth creates an illusion that wealth is being created, when the actual consequence is a net destruction of real wealth It is an institutional form best suited to achieving outcomes exactly the opposite of those we humans must now pursue.

The only legitimate reason for a government to issue a corporate charter giving a group of private investors a legally protected right to aggregate and concentrate virtually unlimited economic power under unified management is to serve a well-defined public purpose under strict rules of public accountability. This defines a public-benefit corporation, which can be chartered as either for-profit or not-for-profit. The private-benefit corporation is an institutional anomaly, a creation of monarchy that properly shares monarchy's historic fate." (http://www.alternet.org/environment/68892/?page=entire)

2. From the Wikipedia:

"A public-benefit corporation is a public corporation chartered by a state designed to perform some public benefit.A public authority is a type of public-benefit corporation that takes on a more bureaucratic role, such as the maintenance of public infrastructure, that often has broad powers to regulate or maintain public property.

Authorities borrow from both municipal corporation law (that is, the laws responsible for the creation of cities, towns, and other forms of local government) and private corporations law. Other public-benefit corporations resemble private non-profit organizations, and take on roles that private corporations might otherwise perform. These corporations often operate in heavily regulated industries, such as broadcasting and transportation.

Corporations such as these are often found in common law jurisdictions such as the Commonwealth countries and the United States." (http://en.wikipedia.org/wiki/Public-benefit_corporation)

Example

From the Wikipedia:

"The first reference to public-benefit corporations in United Kingdom law is in the Health and Social Care (Community Health and Standards) Act 2003, which established NHS Foundation Trusts as public-benefit corporations. Schedule 1 of the Act sets out the requirements for a public-benefit corporation which include a membership made up of individuals living in a specific area, employees of the corporation and service users, and a board of governors some of whom are elected by the members based on "constituencies" such as staff, users or public.

Public-benefit corporations are distinguishable from public authorities in that the latter do not have a membership.

Examples of other bodies which have a similar role to, whilst not being formally called, public-benefit corporations include the BBC, which is incorporated by royal charter. Many universities have charters going back centuries, and so are also chartered corporations." ((http://en.wikipedia.org/wiki/Public-benefit_corporation))