Fourth time's a charm.
Well, maybe. State Rep. Zachary Cook, R-Ruidoso, says he's been asked repeatedly how many times prior to this year's Legislature he introduced the bill that would allow New Mexico businesses to designate themselves as benefit corporations. He thinks this year was the fourth time. At any rate, it was the one that counted.
The bill, House Bill 118, made it through multiple House and Senate committees, and passed the Senate floor on Feb. 18 on a 26-16 vote. It now heads to the governor's desk. Previously, a governor's spokesman said Gov. Michelle Lujan Grisham supported the concept of benefit corporations, but he did not respond to an inquiry yesterday as to whether Lujan Grisham will sign this particular bill. However, its supporters seem optimistic, given that the governor had sent a message allowing it to be heard during the limited 30-day session.
As for its passage: "I think it will mean that we will see new businesses incorporated here in New Mexico to take advantage of the status," Cook said. "And I hope to see, of course, more investment in our state from outside businesses and investors as well as job growth and innovation."
As SFR reported previously, the bill expands the state's Business Corporation Act so that businesses and corporations can voluntarily identify as benefit corporations, ones that takes the public good—stakeholders' concerns—into account along with making a profit for its shareholders. Among other requirements, businesses would adhere to third-party standards for benefit corporations and would produce public reports about said benefits. The benefit corporation movement has been steadily growing. More than 35 other states allow businesses to incorporate as such.
Santa Fe Green Chamber of Commerce Executive Director Glenn Schiffbauer, who has been working with Cook on the bill since it was first introduced, says its passage "feels like a weight off my shoulders. We've come so close a couple of times and not quite made it…it feels really good." Schiffbauer also thinks the move will spur business: "I think there have been a lot of companies in the pipeline that have been waiting for this. I heard from several representatives in Albuquerque who have heard their constituents wanting to incorporate as benefit corporation. I think it's going to help retain some of the smaller startup companies, especially the ones that are being started by millennials. I think that demographic really understands how business can help a lot with environmental and social things."
Another advocate, Santa Fe Innovates founder Jon Mertz also heralded the news, writing by email to SFR that: "With one in three startups incorporating a social good mission into their enterprise, New Mexico will be well-positioned to attract entrepreneurs with this goal. Benefit corporation as an option provides the framework and transparency for startups to be accountable for profit and purpose."
Santa Fe Innovates is holding a public panel on benefit corporations at 5:30 pm, Tuesday, Feb. 25 at The Alley in DeVargas Center.