Benefit corporations are like the goody-two-shoes in a school where everyone else misbehaves. While they voluntarily disclose all kinds of information about their operations, other corporations hide as much as they can.
The worst corporate offenders enable cross-border money laundering and tax evasion. But many legitimate privately owned businesses would also prefer not to publish information they are required to submit to governments about their owners or their finances. And since business owners have a lot of political influence, it’s often hard to get to those public records. But one plucky little website has taken on the task.
Open Corporates was created by two open-data activists in the United Kingdom and funded by several foundations, including the World Bank Institute. The site’s goals are huge and simple: to get the URL of every company in the world, and to import and match government data relating to those specific companies. The site delivers that information in an easy-to-search format, and it also ranks countries and states according to how much information they publish.
Open Corporates is a project of Chris Taggart and Rob McKinnon, entrepreneurs and open-data activists, and their company, Chrinon Ltd. “Few parts of the corporate world are limited to a single country,” they write, “so the world needs a way of bringing the information together in a single place that’s accessible to anyone, not just those who subscribe to proprietary datasets.” The entire database is available for download to anyone who asks in a variety of open formats, and is shared through the Open Database License.
In mid-January 2016, the site had information on 85 million companies in 105 jurisdictions, and they were working with the open data community to add more each week. The database maintained by Dun and Bradstreet contains over 240 million company records from 200 countries, but it’s available only to subscribers and it isn’t cheap.
A dozen countries score 10 on the 100-point Open Company Data Index, including world-famous offshore tax havens like Bermuda, Barbados, and Jersey. Denmark and the United Kingdom are the highest scorers (both at 90); corporations registered in those countries must publish the names of directors and financial statements in free, searchable databases. The United States scores just 30 out of 100, which puts it in the same league as Albania and Myanmar.
It is true that most US corporations that sell stock are required to submit lots of information to the Securities and Exchange Commission (SEC), and those documents are searchable on the SEC’s EDGAR database. Yet fewer than 1 percent of American companies are traded on the major exchanges. There are also about 28 million privately owned firms in the US, according to Sageworks, which analyzes aggregate information collected from accountants and banks.
All corporations in the US have to register with a state government. The registrations usually name the corporation’s owner or agent, and most of them offer other kinds of information. But Open Corporates lists only two American states (Alaska and Arizona) that publish the names of shareholders of private companies online. Only four (Alaska, Florida, Vermont, and Wyoming) publish the names of directors, and no state publishes financial reports.
B Corps are required to pass rigorous, voluntary audits to certify that their social and environmental practices meet high standards, and to make those audits available to the public. There are more than 1,400 of them in 42 countries, which means we have just 240 million more to go. Open Corporates has started the job.