New corporate structures allow a company to encompass environmental and social responsibility within the core of its business. These legal structures are designed to consider stakeholders in addition to shareholders.
The L3C stands for “Low-profit Limited Liability Company”. It functions as a Limited Liability Company but allows for social enterprise. Though this entity is not allowed to solicit charitable contributions, it can solicit investments from foundations or private funders allowing more flexibility to grow.
The B-Corporation (or Benefit Corporation) is designed to create social and environmental change by embedding values within the corporate structure. A traditional C-corporation can become a B-corporation by meeting social and environmental standards and changing the by-laws to incorporate the interests of employees, community and the environment.
These corporate structures are designed to promote sustainability within organizations.