PBC Reporting: What You Need to Know

If you are already a Delaware Public Benefit Corporation (PBC) or thinking about becoming one, you’ll need to understand the reporting obligations that come with this unique corporate form. This article provides an overview of PBC reporting obligations and offers practical guidance for getting started and staying compliant.

Overview of PBC reporting obligations

At least every two years, a Delaware PBC must provide its stockholders with a report (a “benefit report”) on how the company has promoted its public benefit purpose (as stated in the company’s charter) and the best interests of its stakeholders (employees, customers, suppliers, local community, etc.).

Benefit reports must incorporate four key elements:

1. Objectives: Goals set by the board to advance the company’s public benefit purpose and stakeholder interests.
2. Standards: The metrics or frameworks adopted to measure progress toward those objectives.
3. Factual information: Data showing the company’s success in meeting its objectives.
4. Assessment: A candid evaluation of performance against those objectives.

These statutory requirements may seem onerous, but there is significant flexibility in how companies choose to present this information, enabling them to tailor their benefit report to suit both their unique mission and the evolving expectations of their stakeholders.

Getting started

At the time the company becomes a PBC, its board of directors should establish not only its public benefit and stakeholder objectives, but also the standards used to measure progress toward those objectives. The company may later fine-tune these metrics and standards, but they should be defined and tracked at the outset, along with other key performance indicators (KPIs), such as revenue growth. Once these metrics are set, the company should regularly provide the board with quantitative and qualitative progress updates. Establishing this discipline early on facilitates preparation of the benefit report and demonstrates to the board that the company is committed to its public benefit objectives.

In Delaware, there’s no requirement to make the report public, so early-stage private companies tend to take a minimalist approach and deliver them only to stockholders as required by the law. We’ve seen benefit reports range in style from formal stockholder notices and informal letters from the CEO to slide decks delivered as an investor update. So long as the mandated elements are included, the company has wide latitude in how to structure and deliver the benefit report.

This flexibility allows for an easy on-ramp for small and early-stage companies that have limited institutional capacity, enabling them to build a reporting process that fits their stage of growth and resources, while meeting statutory requirements. As companies scale, PBC reporting often becomes more sophisticated. Many mature PBCs incorporate benefit reports into public-facing sustainability or impact reports to share their initiatives more broadly with their stakeholders and the general public. These reports often follow environmental, social and governance (ESG) standards, such as SASB (Sustainable Accounting Standards Board), GRI (Global Reporting Initiative) and/or UN Sustainable Development Goals (SDGs). You can find more detail on these and other ESG frameworks in this Cooley GO article.

Companies should consider how best to communicate their impact, keeping in mind both legal compliance and the opportunity to foster trust with investors and other stockholders. Regardless of the format chosen, any claims made in benefit reports must be accurate and substantiated by data. While there’s no audit or third-party verification requirement, accuracy and transparency are essential to avoiding reputational risk and potential liability for inaccurate or misleading disclosures.

Timing considerations

Since benefit reports must be provided at least every two years, companies should allow enough time to collect and summarize public benefit data and stakeholder impacts. We find it is often helpful to tie impact reporting to other year-end reporting and data collection efforts, which in practice means that companies should plan for a lead time of less than two years initially. For example, a PBC that incorporated on March 1, 2025, must deliver its first benefit report by March 1, 2027. At the time of incorporation, the board would establish the metrics and standards to be used, and the company would track the relevant benefit and stakeholder data through the end of calendar year 2026. In early 2027, the company would synthesize that data and prepare the benefit report for board review and delivery to stockholders by the March 1, 2027, deadline.

Best practices for drafting the benefit report

Define objectives at the outset

As part of the process for incorporating or converting to a PBC, the board and executives should clearly define the objectives and initial standards by which the company will assess its public benefit purpose. Establishing these measures early will standardize the approach to monitoring progress and streamline the creation of the company’s inaugural benefit report.

Institutionalize impact reporting

Board meetings should include regular reporting on public benefit metrics and consistently incorporate discussion of the company’s public benefit and stakeholder impacts. By doing so, the company will be well-positioned to consolidate relevant data for comprehensive and accurate benefit reports and effective stakeholder engagement.

Start simple; evolve over time

Early-stage startups should keep initial benefit reports simple and minimally scoped for compliance. Starting with a lighter approach enables companies with limited resources to meet PBC reporting requirements without overextending themselves. As the company scales, the board and executives can consider aligning its public benefit metrics with established independent ESG standards. By adopting more sophisticated frameworks and processes, PBC reporting becomes an opportunity to build stakeholder confidence and reinforce the company’s public benefit goals.

Ensure quality and accuracy

The benefit report must be an objective and accurate representation of the company’s public benefit goals, stakeholder impacts, opportunities and challenges. When drafting the benefit report, companies should present a balanced perspective by highlighting both successes and challenges encountered in pursuing public benefit objectives. Avoid the temptation to focus solely on positive outcomes or exaggerate impact, as this can undermine trust and credibility and ultimately lead to liability. Misleading or overly optimistic disclosures can create reputational and legal risk, even if the report is only being distributed to stockholders and not made available to the general public.

Why it matters

The benefit report isn’t just a compliance exercise – it’s an opportunity to reinforce the company’s mission, engage with your stakeholders, and evaluate progress and opportunities for greater impact. When thoughtfully prepared, the benefit report serves as a catalyst for meaningful dialogue about the company’s public benefit performance, prompting leadership to reflect on the effectiveness of current strategies and identify areas for growth. By leveraging the insights gained from this process, PBCs can set more ambitious goals, improve stakeholder relationships and embed accountability throughout the organization, paving the way for sustained value creation and greater public benefit.