Arizona Laws 10-2432. Standard of conduct for officers
A. Each officer of a benefit corporation shall consider the interests and factors described in section 10-2431, subsection A, in the manner provided in that subsection, if both of the following apply:
Terms Used In Arizona Laws 10-2432
- Articles of incorporation: means the original or restated articles of incorporation or articles of merger and all amendments to the articles of incorporation or merger and includes amended and restated articles of incorporation and articles of amendment and merger. See Arizona Laws 10-140
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Benefit corporation: means a corporation that both:
(a) Has elected to become subject to this chapter. See Arizona Laws 10-2402
- Bylaws: means the code of rules adopted for the regulation or management of the affairs of the corporation irrespective of the name by which those rules are designated. See Arizona Laws 10-140
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
- General public benefit: means a material positive impact on society and the environment, taken as a whole, assessed against a third-party standard, from the business and operations of a benefit corporation. See Arizona Laws 10-2402
- Person: includes an individual and entity. See Arizona Laws 10-140
- Specific public benefit: includes :
(a) Providing low-income or underserved individuals or communities with beneficial products or services. See Arizona Laws 10-2402
1. The officer has discretion to act with respect to a matter.
2. It reasonably appears to the officer that the matter may have a material effect on the general public benefit or specific public benefit identified in the articles of incorporation of the benefit corporation.
B. The consideration of interests and factors in the manner described in subsection A of this section does not constitute a violation of section 10-842.
C. Except as otherwise provided in this section, the standards of conduct and presumptions prescribed in chapter 8 of this title apply to officers of benefit corporations.
D. Except as provided in the articles of incorporation or bylaws, an officer is not personally liable for monetary damages for failure of the benefit corporation to pursue or create general public benefit or a specific public benefit.
E. An officer does not have a duty to a person that is a beneficiary of the general public benefit purpose or the specific public benefit purpose of a benefit corporation arising from the status of the person as a beneficiary.
F. An officer who makes a business judgment in good faith fulfills the duty under this section if all of the following apply:
1. The officer is not interested in the subject of the business judgment.
2. The officer is informed with respect to the subject of the business judgment to the extent the officer reasonably believes to be appropriate under the circumstances.
3. The officer rationally believes that the business judgment is in the best interests of the benefit corporation.