After 99% of voting shareholders voiced their support, Veeva systems has elected to become the first publicly traded company (as well as the largest company to date) to convert to a public benefit corporation (PBC). The move, effective February 1, means the firm remains a for-profit entity but will be legally responsible to balance the interests of customers, employees, partners and shareholders.
Additionally, Veeva will expand its certificate of incorporation to include a public benefit purpose, “to help make the industries it serves more productive and create high-quality employment opportunities.”
Paul Shawah, executive vice president of strategy for Veeva Systems, told Outsourcing-Pharma, “Our public benefit purpose aligns with the industry’s mission, so customers can have more confidence to partner with Veeva for decades to come. In doing so, we are helping customers be more productive to bring patients the medicines they need faster.”
In addition, Shawah commented, the move signifies to Veeva staff and potential recruits their dedication.
“Employees also want to know they work for a company that isn’t all about the money and is focused on making a positive impact on society. Becoming a PBC will enable us to retain existing employees and attract world-class talent looking to join a purpose-driven company, and we believe that doing the right thing for customer and employees is ultimately good for business and shareholders,” he said.
Shawah added that while the move to make Veeva Systems a PBC is significant, day-to-day functions will remain much the same.
“Nothing will change from an operations perspective; Veeva has always operated with the long-term view that doing the right thing for our customers, employees, and communities ultimately allows us to deliver the best results for investors,” he remarked. “Becoming a PBC aligns with how we already run the company and our long-standing core values: do the right thing, customer success, and employee success.”
Shawah pointed out that PBC status will change the legal duty of the Veeva Systems board going forward to balance the interests of all stakeholders “for every important company decision and to pursue our public benefit purpose.”
According to Shawah, the PBC process began in earnest in 2014, when the Veeva management team started working on a corporate citizenship statement; during the process, the team learned about the PBC structure.
“The conversation internally has been ongoing for several years, and we started discussing the conversion to a PBC with Veeva’s board 18 months ago,” he told OSP. “We considered how becoming a PBC aligned to our core values, how we operated the company, and how we already made big decisions thinking about the impact to our customers, employees, and partners.”
“As Veeva has grown, we’ve deepened customer relationships, and become increasingly important to the industry,” Shawah continued. “It made sense to make a commitment to remain aligned with the life sciences industry’s mission to advance human health and wellbeing over the long-term.”