HB 5710 Summary

• Adds Chapter 9A to Michigan's Business Corporation Act to authorize "benefit corporations" that pursue general and specific public benefits alongside profit-making activities.

• Benefit corporations must state their status in articles of incorporation and pursue material positive impacts on society and environment as measured by independent third-party standards.

• Directors and officers of benefit corporations must consider effects on shareholders, employees, customers, communities, environment, and long-term interests while pursuing public benefit purposes; creates presumption that actions advancing public benefits are in corporation's best interests.

• Allows benefit enforcement proceedings to be brought directly by the corporation or derivatively by shareholders owning 2% of outstanding shares, directors, parent company equity holders (5%+), or others specified in articles or bylaws.

• Changes to benefit corporation status require approval by supermajority vote (two-thirds) of all shareholder classes, and dissenting shareholders may seek payment for shares; law takes effect 90 days after enactment and is conditioned on passage of HB 5711, HB 5712, and HB 5713.