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§ 8895. Standard of conduct for members

Purdon's Pennsylvania Statutes and Consolidated StatutesTitle 15 Pa.C.S.A. Corporations and Unincorporated AssociationsEffective: January 3, 2023

Purdon's Pennsylvania Statutes and Consolidated Statutes
Title 15 Pa.C.S.A. Corporations and Unincorporated Associations (Refs & Annos)
Part III. Partnerships and Limited Liability Companies (Refs & Annos)
Chapter 88. Limited Liability Companies (Refs & Annos)
Subchapter I. Benefit Companies (Refs & Annos)
Effective: January 3, 2023
15 Pa.C.S.A. § 8895
§ 8895. Standard of conduct for members
Currentness
(a) Consideration of interests.--The members of a member-managed limited liability company that is a benefit company, when discharging their duties under this title or under the operating agreement:
(1) shall consider the effects of any action upon:
(i) the members of the benefit company;
(ii) the employees and work force of the benefit company and its subsidiaries and suppliers;
(iii) the interests of customers as beneficiaries of the general or specific public benefit purposes of the benefit company;
(iv) community and societal considerations, including those of any community in which offices or facilities of the benefit company or its subsidiaries or suppliers are located;
(v) the local and global environment;
(vi) the short-term and long-term interests of the benefit company, including benefits that may accrue to the benefit company from its long-term plans and the possibility that these interests may be best served by the continued independence of the benefit company; and
(vii) the ability of the benefit company to accomplish its general public benefit purpose and any specific public benefit purpose; and
(2) may consider any other pertinent factors or the interests of any other group that they deem appropriate; but
(3) shall not be required to give priority to any matter referred to in paragraph (1) or (2) over any other such matter or to regard any such matter as dominant or controlling unless the benefit company has stated in its certificate of organization its intention to give priority to certain interests related to its accomplishment of its general public benefit purpose or of a specific public benefit purpose identified in the certificate.
(b) Coordination with other provisions of law.--The consideration of matters in the manner required under subsection (a) shall not constitute a violation of section 8849.1 (relating to standards of conduct for members).
(c) Exoneration from personal liability.--Regardless of whether the operating agreement of a member-managed benefit company includes a provision eliminating or limiting the personal liability of a member:
(1) A member shall not be personally liable for monetary damages for any action taken as a member of the benefit company in the course of performing the duties specified in subsection (a) unless the action constitutes self-dealing, willful misconduct or recklessness.
(2) A member shall not be personally liable for monetary damages for failure of the benefit company to pursue or create general public benefit or a specific public benefit.
(d) Limitation on standing.--A member of a member-managed limited liability company that is a benefit company 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 the benefit company arising from the status of the person as a beneficiary.
(e) Ownership of interest.--A member's ownership, directly or indirectly, of an interest in a benefit company does not alone create a conflict of interest on the part of the member with respect to the member's performance of the duties of a member under subsection (a), except to the extent the ownership would create a conflict of interest if the limited liability company were not a benefit company.

Credits

2016, Nov. 21, P.L. 1328, No. 170, § 29, effective in 90 days [Feb. 21, 2017]. Amended 2022, Nov. 3, P.L. 1791, No. 122, § 107, effective in 60 days [Jan. 3, 2023].
15 Pa.C.S.A. § 8895, PA ST 15 Pa.C.S.A. § 8895
Current through Act 11 of the 2024 Regular Session. Some statute sections may be more current, see credits for details.
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