Benefit corporation legislation for New Mexico
I want to incorporate my company as a 501(c)(3) public benefit corporation, and it is not possible in New Mexico. What 34 other states have enacted, New Mexico has not.
In 2013, the New Mexico Senate passed benefit corporation legislation 33-6, and the New Mexico House passed it 62-3. However, then-Gov. Susana Martinez pocket-vetoed the legislation with no explanation. In other states, benefit corporation legislation passed through a bipartisan effort. Such legislation has been signed by both Republican and Democrat governors.
Why benefit corporations? B Corps are required to do more than maximize shareholder value. All stakeholders matter, and it includes publishing an annual report on the business impact on social and environmental elements. Benefit corporations build greater purpose into companies from the start, and decisions are made from a broader perspective than shareholders only. Simply stated, if you believe business can be a force for good, then legally becoming a benefit corporation embeds these beliefs and operationalizes them.
Some confuse benefit corporations with certified B corporations. Although different, they are related. A benefit corporation is the legal structure, and the certified B corporation assesses how well companies are doing in serving all stakeholders and a social purpose. When you search the certified B corporation directory, the following New Mexican companies have been B corporation certified: Meow Wolf, Taos Ski Valley, SecondMuse, SunPower by Positive Solar Energy and UpSpring. Being B corporation certified is a worthy step. With the added legal structure of benefit corporations, New Mexico can instill these good practices deeper within startups and existing businesses.
Capitalism is changing. CEOs and business leaders are getting more involved in key social and environmental issues, stepping in when the federal government ignores climate change challenges and when some state governments go too far on certain social issues. More conversations are happening about how capitalism needs to change to be more accountable while thinking and acting more holistically for the longer term. Benefit corporations are more than a legal structure. Benefit corporations are leaders of a movement to use business as a force for good.
New Mexico was the 47th state admitted to our union. We should not be the 47th state to enact benefit corporation legislation. In 2019, the state Legislature should pass the benefit corporation bill again, and this time, Gov. Michelle Lujan Grisham will sign it into law, as indicated to me by her campaign team. The business outlook is growing within New Mexico. Now is the time to act and provide an option for businesses seeking to do good for all stakeholders.
Jon Mertz is CEO of Activate World, a think tank focused on business leader activism. He lives in Santa Fe.