Accountant, attorney, and B Corp movement supporter Senen Garcia, Esq. got his entrepreneurial start at an early age. The sole owner of two businesses before completing his bachelor’s degree in Business Administration with a concentration in Entrepreneurship and International Business, Garcia opened his accounting and tax practice before receiving his undergraduate degree. While running said business, he completed his Graduate and Juris Doctorate degrees and now operates SG Law Group in Florida which assists clients with their corporate, real estate, estate planning an property insurance claim needs.
Today he’s giving us a look at how he got interested in the B Corp movement, what he believes Benefit Corporations need in order to succeed and why the real benefit behind the B Corps has a lot to do with marketing.
1. What sparked your interest in the Benefit Corporation movement?
I read an article about it fairly recently and started doing some more research to find out more about it. I’m an attorney, but am actually also an accountant – and have been longer than I’ve been an attorney. From an accountant’s perspective one of the big things that helps my clients is to always look at not only what is best legally, but also what’s best from a tax perspective. When I started learning more about the benefit corporation and I saw what it was about, I decided I wanted to communicate this new information to people.
2. What are your thoughts on how the Benefit Corporation is evolving?
It’s still slow going, which is not surprising. The same thing happened with the LLC, where there was a big push last decade but it took a long time for it to get into the mainstream. What allowed the LLC to take off were the opinions that came from legal community, and then tax perspective from the IRS. But a B Corporation is kind of like a piggy back onto a regular corporation structure, so there are fewer differences to consider than there were with the LLC.
3. What are some of the benefits you see in choosing a Benefit Corporation over a traditional for-profit?
Legally and from a tax perspective they’re really the same. The only real difference is this added requirement of social responsibility, and in reality, a lot of companies are doing that without the B Corporation designation.
The real benefit is that it’s more like a marketing tool. With the millennial generation, it’s becoming more prevalent because you have millennials who want to see a social aspect in businesses and a positive contribution to community. So if you’re a business in an industry where you’re going after milliennials, mostly or exclusively, this is something you want to take advantage of. I think it really boils down to who your market is.
4. What do you think the future looks like for the Benefit Corporation movement?
It’s definitely still in the development stage. Many states are passing legislation, but not even half of the states recognize benefit corporations. My state, Florida, failed to enact the legislation. I wouldn’t say Florida passed on it for good, but they recently rejected it so if it comes up again it probably won’t be for another four or five years or so. I think Florida’s mindset is “show me how it will work,” and then they’ll revisit it.
What the movement needs is consolidation of the social and environmental standard and requirements, and uniformity with respect to how the benefit corporation will function. I think uniformity will help solidify the movement. It’s difficult to have multiple states that have multiple rules regarding how a benefit corporation must be in compliance. That makes it cumbersome.
5. What is some advice you would give to entrepreneurs who are considering starting their own Benefit Corporation?
First I would say determine what state you’re looking to do business in, and make sure it at least recognizes the Benefit Corporation. Then see what the requirements are since every state that recognizes them varies slightly. Most importantly, make sure that your market will be receptive to this. Make sure if you’re going to do this, that incorporating as a benefit corporation is a benefit to the company in the short run and the long run. You can set up a company as a C-Corp or S-Corp and elect to be a B Corp later on. That won’t hurt you legally.
For a free consultation with SG Law Group, or to reach out to Senen call 1-855-277-0724.
Are you a B-Corporation that would like to be featured on our blog? Or an expert in B-Corps? Email Heather at htaylor@mycorporation.com for more information!