... OpenAI’s dilemma: Commentators have noted the company’s unusual, conflicted, structure. A nonprofit board with a mission to benefit humanity oversees a for-profit arm backed by Microsoft and venture capital firms including Thrive Capital and Khosla Ventures. ...
The entire enterprise’s goal is to build an artificial general intelligence, highly autonomous systems that “outperform humans at most economically valuable work” but “benefits all of humanity.” OpenAI’s commercial arm was created to support that enormously expensive goal, but it is hemmed in by limits on profits that flow to investors, as well as no governance rights for investors. That’s why Microsoft, Thrive and others have little direct leverage on how the company is run. ...
That’s not the only unusual corporate structure in the A.I. industry.Anthropic, begun by a dozen ex-OpenAI employees concerned about their former employer’s race for profits, is set up as a B Corp, or public benefit corporation, that is meant to balance the interests of a wide array of stakeholders.
It also has a so-called long-term benefit trust that includes A.I. ethicists and other experts and is allowed to choose a majority of the company’s directors. ...
See the full story here: https://www.nytimes.com/2023/11/21/business/dealbook/openai-corporate-governance-altman-board.html