By formally stating mission as part of the corporate purpose in the company’s charter, the company sets a clear standard for all stakeholders and communicates its impact commitment to existing and future stakeholders. The agreed upon language may constrain directors’ and management’s decision making authority, influence how directors’ and management’s fiduciary duties are interpreted and also potentially limit the permissible activities and operations of the company. Accordingly, any charter language needs to be drafted with extreme care after consultation with knowledgeable legal counsel.
If the parties know that they want to incorporate mission into the company’s charter, they will also want to consider alternative corporate forms such as the Benefit Corporation and the Social Purpose Corporation.
Including mission in the statement of corporate purpose
The Company’s [identify charter document] shall set forth [the Company’s purpose of [goal definition] OR [the Company’s standards of corporate citizenship as described in Exhibit X].