You may have noticed that our name, Juris, is sometimes followed by the letters PBC, like this: Juris, PBC. That’s our company’s full legal name. You’re probably more used to seeing other letters after a company’s name, like Inc. or LLC. The letters PBC are meant to tell the world that Juris is a different kind of company. Juris is a public benefit corporation. The co-founders of Juris decided to form the company as a public benefit corporation because they care about more than making money. They wanted to put our social impact mission into the DNA of the company, so that all current and future stakeholders in Juris would understand its importance.
Typical companies are required to make as much money as possible.
In America, when you start a company you usually have to decide on a set of rules that will govern how the company is run. You have to decide things like who will make the decisions, who will do what work, and, perhaps most importantly, what the goals of the company will be. Usually you write these rules down and submit them to a state like Delaware, and then Delaware records that you’ve started a company. At that time, you also choose what kind of company you will create from the options that Delaware offers. The different kinds of companies are obligated to follow certain rules, so this decision also affects the rules of your company. In Delaware, you can choose to form a limited liability company, or a a limited partnership, or a limited liability partnership, or something else. But the most prominent kind is a corporation.
A typical corporation holds one goal above all others: maximize shareholder value. That’s a fancy way of saying: make as much money as possible. And lawmakers and judges have approved this setup again and again over time. They’ve said that the most important goal of a company is to make as much money as possible. They’ve even said that failing to make as much money as possible is a violation of the law and/or the company’s rules. Lately, there’s been some resistance to this way of doing things but for the most part it’s the accepted way of doing things.
A PBC is a new kind of company that is not required to make as much money as possible.
In 2012, the leaders of Patagonia, the outdoor clothing and gear corporation, took a hard look at the effects of pursuing money over all else. They specifically looked at the environmental damage caused each year on a massive scale by companies chasing profits over all else. And they decided that they had to take a drastic step. They decided they had to change the rules.
Patagonia was the first major company that chose to become a public benefit corporation. To achieve this, the leaders of the company wrote a new set of rules. These rules stated clearly that the goal of the company was to make money, yes, but also to make a positive social impact on the world. And, critically, these new rules stated that the company’s leaders could prioritize this positive social impact over maximizing shareholder value. Shareholders could no longer compel Patagonia’s leadership to make decisions on the sole basis of making as much money as possible.
Since Patagonia made this bold move, many other companies have followed suit. Companies like Kickstarter, Ben & Jerry’s, and Allbirds have chosen to organize as public benefit corporations, with the dual goals of making money and making positive impacts.
Juris is a public benefit corporation because its co-founders want to change the world.
Our company was born out of the frustration of our Chairman, Saul Kerpelman, who spent 35 years in Baltimore courtrooms representing children who suffered from brain damage after they ate lead paint that never should have been in their homes. Over that time, Saul witnessed a civil justice system that too often fails the vast majority of Americans. He helped thousands of families, but the problem looms large today. 78% of Americans don’t use our country’s civil justice system. They can’t afford justice or don’t know how to get it. The co-founders of Juris founded the company because they wanted to help fix that problem. They wanted to make the world more fair. And they believed that pure pursuit of profit maximization is not the best way to achieve that goal.
You can check out the rules yourself that the co-founders wrote down at the inception of the company. We’ve made them available here: Juris, PBC Articles of Incorporation. Article III, Section B(2) states, “Juris will bring effective, peaceful, fair, and balanced dispute resolution and civil justice to the billions without access due to circumstances economic, political, or otherwise.” That’s our mission.
Juris chose to become a PBC so that it would be legally obligated to abide by certain rules.
Delaware law requires that PBCs articulate their social impact mission in their company rules. We already covered that one above.
Delaware law requires that PBCs issue a statement at least once every two years describing the progress it has made toward achieving its social impact mission. Juris looks forward to issuing its first social impact statement in 2020.
Delaware law also requires that the leadership of PBCs balance maximizing profits with the best interests of those affected by the company’s conduct and the specific public benefits the company articulated in its Articles of Incorporation. The leadership of Juris thinks about this duty every day, and it guides their decision-making at all times. If shareholders feel the leadership is not fulfilling this duty, they can sue Juris in court.
We care about more than just making money. We want to help people. We want to provide access to justice to the millions in America and billions worldwide who can’t get it today. And our decision to incorporate as a PBC means that we have the structural latitude to pursue that mission unencumbered. It means we won’t be forced by greedy stakeholders to start compromising our social mission in favor of our financial one.
So here are some key takeaways to understand.
- Juris is a public benefit corporation because its co-founders want to make the world more fair, and don’t think pure maximization of profits is the way to do that.
- Public benefit corporations are different from typical corporations in that the leaders of PBCs aren’t obligated to maximize profits above all else.
- The leadership of Juris (1) has articulated the social impact mission of Juris in its founding document, (2) will issue biennial statements on its social impact progress, and (3) is legally obligated to balance profit maximization against social impact.