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Public Benefit Corporation Information

What is a Public Benefit Corporation (PBC)? 

Public Benefit Corporations, a new legal corporate form, are like traditional for-profit business corporations in most ways except that they choose to make social commitments a part of their business plan. Primarily, a public benefit corporation declares a legally binding social purpose, in addition to its general business purpose, which its directors and officers must consider when making strategic decisions for the business. A public benefits corporation publicly reports its progress toward its social purpose each year by filing an annual benefit report with the Minnesota Secretary of State. 

 

General benefit vs. specific benefit

Minn. Stat. Chapter 304A creates two different types of public benefit corporations: a general business corporation (GBC) and specific benefit corporation (SBC). The corporation must elect one of these two types in Minnesota and use the name of the type of entity in its legal name.

A GBC always has a purpose to pursue a general public benefit1, and may have an additional purpose to pursue a specific public benefit2, while an SBC has a purpose to pursue only a specific public benefit and not any general public benefit. The distinctions between a GBC and an SBC affect the scope of the fiduciary duties of the directors. 

1General benefit: defined as a net material positive impact from the business and operations of a general benefit corporation on society, the environment, and the well-being of present and future generations. (304A.021.3)

2Specific benefit: defined as one or more positive impacts, or reduction of a negative impact, on specified categories of natural persons, entities, communities, or interests, other than shareholders in their capacity as shareholders, as enumerated in the articles of a public benefit corporation. (304A.021.9)

The Public Benefit Corporation Act does not create a new corporate tax status, nor does election to be a PBC confer tax-exempt status or transform a for-profit enterprise into a nonprofit organization. A PBC is taxed as a regular business corporation – either as a C corporation under the Internal Revenue Code or, if it qualifies and makes an election, as a Subchapter S corporation. A nonprofit corporation cannot become a PBC, but it can create a subsidiary PBC. Under Minnesota law enacted in 2016, an LLC is prohibited from converting directly to a Public Benefit Corporation.

From A Guide To STARTING A BUSINESS IN MINNESOTA 43rd Ed. 2025

 

 

What is an annual benefit report?

In order for a PBC to maintain its public benefit status, a public benefit annual report must be filed between January 1st and March 31st. This report is required by Minnesota Statutes, section 304A.301, and is in addition to the normal business corporation annual renewal.

The following information about what must be contained in the PBC annual benefit report comes from Minnesota Statute 304A.301. 

For a specific benefit corporation (SBC), the annual benefit report must contain:

  1. with regard to the period covered by the report, a narrative description of:
    1. the ways in which the corporation pursued and created the specific public benefit stated in its articles;
    2. the extent to which that specific public benefit purpose was pursued and created; and
    3. any circumstances that hindered efforts to pursue or create the specific public benefit; and
  2. a certification that its board of directors has reviewed and approved the report.

 

The annual benefit report of a general benefit corporation (GBC) must:

  1. certify that its board of directors has:
    1. chosen the third-party standard designated pursuant to clause (2), item (i);
    2. determined that the organization that promulgated the third-party standard is independent; and
    3. approved the report;
  2. with regard to the period covered by the report:
    1. identify a third-party standard determined by the board; and
    2. with reference to that third-party standard, describe:
      1. how the corporation has pursued general public benefit;
      2. the extent to which and the ways in which the corporation has created general public benefit; and
      3. any circumstances that hindered efforts to pursue or create general public benefit;
  3. if the report is the first delivered for filing by the general benefit corporation, explain how and why the board chose the third-party standard identified under clause (2), item (i);
  4. if the third-party standard identified under clause (2), item (i), is the same third-party standard identified in the immediately prior report:
    1. state whether the third-party standard is being applied in a manner consistent with the third-party standard's application in the prior reports; and
    2. if the third-party standard is not being so applied in a consistent manner, explain why;
  5. if the third-party standard identified under clause (2), item (i), is not the same as the third-party standard identified in the immediately prior report, explain how and why the board chose a different third-party standard; and
  6. if the general benefit corporation has also stated a specific public benefit purpose in its articles, the information required in subdivision 2, clause (1).

 

 

How to file your annual benefit report

The Office of the Minnesota Secretary of State offers a Minnesota Public Benefit Corporation Annual Benefit Report form. The form is not required, but it does include space for all the required elements. You are encouraged to provide your own report in a narrative form as long as it includes all of the required elements. Before April 1 of each year, a public benefit corporation must file an annual benefit report covering the 12-month period ending on December 31 of the previous year. If a public benefit corporation fails to file by March 31, of any calendar year, the corporation’s status as a public benefit corporation will be revoked by the Office of the Minnesota Secretary of State. The report must be in the possession of the Office of the Secretary of State by March 31.

Also, please remember that the elements for a general benefit report are different and more extensive, especially in the first reporting year, than for a specific benefit report. Please see 304A.301 for all requirements.

The options available to file the annual benefit report are:  

  • online (see step-by-step instructions below)
  • file by mail
  • make an appointment to file in person at the counter 

The fee to file the public annual benefit report is $35.00 by mail, or $55.00 online or at the counter (by appointment only). If the annual benefit report is not filed by April 1st, the public benefit status will be revoked. The public benefit annual reinstatement fee is $500.00 by mail or $520.00 at the counter (by appointment only).  

Finally, the annual benefit report must be received no later than April 1.  Reports postmarked on or before April 1, but received in the Minnesota Secretary of State Office after April 1, will be rejected as late and are not acceptable. Please remember that failure to file the report by the deadline will result in the immediate loss of your status as a public benefit corporation. 

Please visit the Online Business Filings website: sos.mn.gov/findabiz 
If you already have an account but cannot remember your password, from the Sign In page, you can click “Forgot your password?” to receive an email with a link to reset it.

To create an account:

  1. Click on "Create an Account" located in the upper right-hand corner. 
  2. Supply your email address and create a password. 
  3. Accept the Terms and Conditions; then click "Create Online Account".
  4. You will receive an email with a link to complete the process.

To file your Annual Benefit Report:

  1. Under "Business Filings Online", click on "Business Name" or "File Number".
  2. You may search for the business by Name or File Number.
  3. Click on "Details" to the right of the business name in the "Search Results".
  4. Click on "File Amendment/Renewal" in the Record Detail page. 
  5. Under "Amendments-Available for Filing", click on "Annual Benefit Report – "; then follow the prompts.
  6. Complete the required information and upload your Annual Benefit Report. For further instruction on uploading, please visit: How to amend your business filing.
  7. Review the Filing and then click “Submit”. You will receive an Order Number.
  8. Click to “Continue to Make Payment” button.
  9. Once on the US Bank page, you will have the option to set up an e-service account with US Bank. The US Bank e-service account will store your credit card information for future transactions.
    You can bypass the US Bank e-services registration by clicking on "pay without registering". This allows you to process a one-time payment with your credit card.
  10. After you’ve completed the payment, you will receive a confirmation page along with a payment confirmation number. Print out the confirmation page or record the Confirmation Number. You will receive an email from our office when the filing is processed, as well as an email for the payment from US Bank.
  11. When you receive the email from our office that the filing has been processed, you can open the email, and there will be a link that you can click on that will take you to our website, where you can download a copy of the filing. The link is only valid for 90 days.

NOTE: All filings are kept in the Transaction History for 90 days. The Transaction History is accessible by signing into your online account on our website and then clicking on Transaction History. Once you’re on the History page, you can click on the order number on the right and it will give you an option to download the filing.