Photonews Logo Photonews logo
  • Home
  • Pakistan
    • Punjab
    • Sindh
    • Khyber Pakhtunkhwa
    • Azad Jammu Kashmir
    • Balochistan
    • Gilgit – Baltistan
  • World
  • Business
  • Entertainment
  • Videos
    IShowSpeed Daniel La Belle race
    Videos

    IShowSpeed Beats Daniel La Belle in 40-Meter Race, Hits 41M Subscribers

    June 24, 2025 2 Min Read
    Cardi B new single Outside
    Videos

    Cardi B’s ‘Outside’ Single Sparks Buzz Over Offset and Stefon Diggs

    June 20, 2025 2 Min Read
    Squid Game Season 3
    Videos

    Squid Game Season 3: Final Trailer Unveils Epic Plot

    June 14, 2025 2 Min Read
  • Sports
  • Technology
  • Offbeat
  • Blog
  • Contact
Reading: OpenAI to Transition to Public Benefit Corporation to Fund AI Innovation
PhotoNews Pakistan PhotoNews Pakistan
Font ResizerAa
Search
  • Home
  • Pakistan
    • Punjab
    • Sindh
    • Khyber Pakhtunkhwa
    • Balochistan
    • Azad Jammu Kashmir
    • Gilgit – Baltistan
  • World
  • Business
  • Entertainment
  • Videos
  • Sports
  • Technology
  • Offbeat
  • Blog
  • Contact
Have an existing account? Sign In
Follow US
© 2022 Photonews. All Rights Reserved.
OpenAI social media network
PhotoNews Pakistan > Tech > OpenAI to Transition to Public Benefit Corporation to Fund AI Innovation
Tech

OpenAI to Transition to Public Benefit Corporation to Fund AI Innovation

Web Desk
By Web Desk Published December 28, 2024 3 Min Read
Share
Sam Altman OpenAI CEO . Photo Credits: The Brand Hopper
SHARE

On Friday, OpenAI revealed its intention to convert its for-profit division into a Delaware Public Benefit Corporation (PBC) to attract investment and remain competitive in the costly AI competition with firms such as Google.

The PBC structure is designed to attract investors while staying true to OpenAI’s mission of supporting a related charity. Rivals like Anthropic have already adopted the PBC model to balance societal interests with shareholder value.

What is a Public Benefit Corporation (PBC)?

In contrast to traditional corporations, PBCs must legally seek public benefits, including social and environmental objectives, in addition to profit. Delaware has permitted the creation of PBCs since 2013, and research from the University of Texas indicates that as of December 2023, there are 19 publicly traded PBCs.

OpenAI’s New Organizational Framework

In a blog post, OpenAI described its current structure as:

“A for-profit, controlled by a non-profit, with a capped profit share for investors and employees.”

Under the new setup:

  • The non-profit will own shares in the for-profit, similar to external investors.
  • The for-profit will fund the charitable mission of the non-profit.
  • The PBC will manage OpenAI’s operations and business.
  • The non-profit will oversee charitable initiatives in healthcare, education, and science.

PBC vs. Other Corporate Structures

  • Non-Profits: Have no shareholders and reinvest profits into their mission. They often receive tax exemptions.
  • PBCs: Do not receive tax incentives and must balance profit with their public mission.

Limitations of PBCs

Corporate law professor Ann Lipton highlighted that PBCs are legally obligated to balance profit and mission. However, enforcement of public benefits largely depends on shareholder oversight.

“The only reason to choose a benefit form is to declare a public mission, but there’s little enforcement behind it,” Lipton said.

Additionally, publicly traded PBCs may face higher takeover risks if. Bidders argue that their public mission conflicts with profit maximization.

  • Anthropic and xAI: AI companies competing with OpenAI.
  • Allbirds: Sustainable footwear and apparel brand.
  • Kickstarter: Global crowdfunding platform for creative projects.
  • Patagonia: Outdoor retailer contributing over $230 million to environmental causes.
  • Warby Parker: Eyewear brand with a “Buy a Pair, Give a Pair” policy for those in need.
TAGGED:Featured
Share This Article
Facebook Twitter Pinterest Whatsapp Whatsapp LinkedIn Email Copy Link Print
Leave a comment

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Advertisement

HBL Saving Made Easy
HBL Saving Made Easy

Recent Posts

Microsoft employee layoffs

Microsoft Announces 9,000 Layoffs, Impacting Less Than 4% of Workforce

Sean Diddy Combs guilty on 2 prostitution counts, not guilty on trafficking in 2025 trial

Sean ‘Diddy’ Combs Verdict: Guilty on Two Counts, Not Guilty on Three

Paris Heatwave

Europe Heatwave Claims 4 lives Sparks Deadly Wildfires

Post Archives

More Popular from Photonews

Entertainment

Orlando Bloom Sparks Buzz with Kim Kardashian Greeting at Venice Wedding

2 Min Read
Inter Milan FIFA Club World Cup
Sports

Inter Milan Secures FIFA Club World Cup Knockout Spot

3 Min Read
JCP Chief Justices 2025
Pakistan

JCP Approves Permanent Chief Justices for Four Pakistan High Courts

2 Min Read
Tech

iPhone 17 Pro Max Set to Launch in September 2025 with Major Upgrades

Apple is poised to unveil the iPhone 17 Pro Max, its most advanced smartphone yet, at…

June 27, 2025
Pakistan

Pakistan Hit by Third Earthquake in 24 Hours: Magnitude 3.8 Reported

Pakistan experienced its third earthquake in 24 hours on June 29, 2025, with a 3.8-magnitude quake…

June 29, 2025
Pakistan

Pakistan Monsoon 2025: Karachi Braces for More Rains Amid Flood Alerts

The Pakistan Monsoon 2025 has brought relief from intense heat to Karachi but also tragedy, with…

June 29, 2025
Entertainment

Diljit Dosanjh Addresses Sardaar Ji 3 Ban in India Over Hania Aamir Casting

Punjabi singer-actor Diljit Dosanjh addressed the controversy surrounding his film Sardaar Ji 3, which will not…

June 26, 2025
PhotoNews Pakistan

Always Stay Up to Date

Subscribe to our newsletter to get our newest articles instantly!

Categories

  • World
  • Pakistan
  • Punjab
  • Sindh
  • Khyber Pakhtunkhwa
  • Balochistan
  • Azad Jammu Kashmir

 

  • Top News
  • Business
  • Entertainment
  • Sports
  • Videos
  • Tech
  • Offbeat
  • Blog

© 2024 Phototnews
All Rights Reserved.

Welcome Back!

Sign in to your account

Lost your password?