The 20th-century view of shareholder primacy is flawed. By focusing first on creating wins for all stakeholders—customers, employees, suppliers, and society—companies build a sustainable, beloved enterprise that paradoxically delivers superior returns to shareholders in the long run.

The OpenAI vs. Musk lawsuit suggests a crucial step was missed: when a company fundamentally changes its mission (e.g., nonprofit to for-profit), leadership must proactively offer original funders a revised stake. Executing a "make right" equity deal can prevent the kind of high-stakes litigation OpenAI now faces.

AI firm AMP is structured as a Public Benefit Corporation (PBC) to legally justify its strategy of providing compute at-cost to portfolio companies. A traditional C-Corp structure would expose it to shareholder lawsuits for 'destroying value' by not maximizing profit on its core asset. The PBC charter protects this non-traditional, ecosystem-building model.

The PBC designation is often 'bullshit jazz hands' used for branding, not accountability. To make it meaningful, corporations should be required to meet specific criteria, like paying a minimum tax or capping CEO-to-worker pay ratios.

OpenAI’s complex conversion from a nonprofit to a for-profit benefit corporation, modeled after Mozilla's legal structure, was a strategic necessity. This allows it to operate like a for-profit entity, unlocking massive investments from partners like SoftBank, while navigating the complex tax and governance rules governing its nonprofit origins.

Horowitz argues that forgoing a board is a massive legal risk for CEOs. A board's primary function is to provide a legal shield. Running material decisions, like equity grants, past the board protects the CEO from personal liability and lawsuits from shareholders. Without this process, founders are dangerously exposed.

Unlike publicly traded competitors, Servier's non-profit foundation ownership insulates it from short-term investor pressures. This freedom enables a long-term strategic focus, allowing the company to pursue high-risk, scientifically complex areas like rare oncology that public companies often cannot justify to shareholders.

OpenAI's non-profit parent retains a 26% stake (worth $130B) in its for-profit arm. This novel structure allows the organization to leverage commercial success to generate massive, long-term funding for its original, non-commercial mission, creating a powerful, self-sustaining philanthropic engine.

Both companies leverage their independent ownership to make long-term, values-driven decisions that might be challenged by public market investors. This structure provides the freedom to prioritize purpose over immediate profit, such as restraining growth or making bold political statements.