California has become the latest state to legalize “benefit corporations,” which build social purpose into their businesses and allow companies to put social goals ahead of profits, writes The New York Times.

A dozen states and two Indian tribes have authorized benefit corporations, and New York and Massachusetts are weighing similar legislation. These businesses are allowed to tap into foundation funding as well as conventional capital sources.

R. Todd Johnson, a lawyer active in a national effort to promote hybrid firms, said many company directors “want to do the right thing” but are “so busy looking at how not to get sued for failing to maximize profits that they don’t think more aspirationally about creating a great company that helps the planet and people and also makes money.”

But the new structures concern many charity executives, who fear the hybrids will compete for philanthropic support, and regulators and corporate lawyers, who say they will create conflicts of interest and relax standards of fiduciary responsibility.