Pennsylvania § 3323 Standard of conduct for officers

Pennsylvania Statutes

§ 3323 — Standard of conduct for officers

Pennsylvania·Title 15 CORPORATIONS AND UNINCORPORATED ASSOCIATIONS·Part PART II·Ch. 33 BENEFIT CORPORATIONS·Subch. ACCOUNTABILITY

(a)General rule.--Each officer of a benefit corporation shall consider the interests and factors described in section 3321(a) (relating to standard of conduct for directors) in the manner provided in that subsection when:

(1)the officer has discretion to act with respect to a matter; and

(2)it reasonably appears to the officer that the matter may have a material effect on the creation by the benefit corporation of general public benefit or a specific public benefit identified in the articles of the benefit corporation.

(b)Coordination with other provisions of law.--The consideration of interests and factors in the manner described in subsection (a) shall not constitute a violation of section 1734 (relating to officer's standard of care and justifiable reliance).

(c)Exoneration fro

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(a) General rule.--Each officer of a benefit corporation shall consider the interests and factors described in section 3321(a) (relating to standard of conduct for directors) in the manner provided in that subsection when:

(1) the officer has discretion to act with respect to a matter; and

(2) it reasonably appears to the officer that the matter may have a material effect on the creation by the benefit corporation of general public benefit or a specific public benefit identified in the articles of the benefit corporation.

(b) Coordination with other provisions of law.--The consideration of interests and factors in the manner described in subsection (a) shall not constitute a violation of section 1734 (relating to officer's standard of care and justifiable reliance).

(c) Exoneration from personal liability.--

(1) An officer shall not be personally liable, as such, for monetary damages for any action taken as an officer in the course of performing the duties specified in subsection (a) unless the action constitutes self-dealing, willful misconduct or a knowing violation of law.

(2) An officer shall not be personally liable for monetary damages for failure of the benefit corporation to pursue or create general public benefit or a specific public benefit.

(d) Limitation on standing.--An officer does not have a duty to a person that is a beneficiary of the general public benefit purpose or a specific public benefit purpose of a benefit corporation arising from the status of the person as a beneficiary.

(e) Ownership of shares.--An officer's ownership of, or other interest in, the shares of a benefit corporation does not alone create a conflict of interest on the part of the officer with respect to the officer's performance of the duties of an officer under subsection (a), except to the extent the ownership or interest would create a conflict of interest if the corporation were not a benefit corporation.

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Legislative History

(Nov. 21, 2016, P.L.1328, No.170, eff. 90 days; Nov. 3, 2022, P.L.1791, No.122, eff. 60 days) 2022 Amendment.Act 122 amended subsec. (b) and added subsec. (e). 2016 Amendment.Act 170 amended subsec. (c). Cross References.Section 3323 is referred to in section 3322 of this title.