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What if companies were governed as republics?

"A lady asked Dr. Franklin well Doctor what have we got a republic or a monarchy — A republic replied the Doctor if you can keep it."
- James McHenry's journal entry dated September 18, 1787. The lady in reference was Elizabeth Powel.

The following charter was drafted between the hours of May 24th and 26th, 2025.

This is experimental and, as of this writing, does not fully align with my views on corporate governance. However, it has value, which is why I am sharing it publicly for scrutiny.

I am not a lawyer. The charter shared on this blog-post is for general informational purposes only and does not create an attorney-client relationship or any other professional duty. While I strive to provide accurate and up-to-date information, this content should not be interpreted as professional legal advice. For legal concerns, always consult with a qualified attorney.

Multiple LLM models were used in formalizing this piece of document; all interpretations and errors are mine.

Charter of the <Company-Name> Republic

Adopted under the laws of the State of Delaware as a Public Benefit Corporation (PBC)

Preamble

We, the Members, Founders, and Investors of <Company-Name> (the "Company"), establish this Charter to foster an enduring community of technologists who create valuable products, share prosperity fairly, and safeguard our founding mission of open innovation.

Article I — Legal Form & Public Benefit

  1. Entity Type. The Company is a Delaware Public Benefit Corporation (PBC) and shall remain so unless amended under Article VIII.
  2. Public Benefit Purpose. The Company shall pursue the creation and open dissemination of technology that improves public welfare while providing sustainable livelihoods for its participants.
  3. Supremacy. In any conflict between this Charter and ordinary bylaws or policies, this Charter prevails, except where prohibited by mandatory law.

Article II — Classes of Participants

Class Designation Voting Power Economic Rights
Members Hold Class M Shares (one share per person). Includes all employees and Founders. 1 vote per Member on matters defined herein. Salary, annual Profit-Share Pool, and patronage dividends.
Founders Sub-set of Members holding Class F Shares. Same as Class M plus Limited Veto under Art. V-6. Same economic rights as Members.
Investors Hold Class I Preferred Shares. No vote on day-to-day governance; possess Protective Provisions (Art. VII). Cumulative 6 % non-participating preferred dividend plus pro-rata share of Investor Allocation Pool.

Article III — Governance Bodies

  1. Senate (Board of Directors).
    1. Composed of nine (9) seats, fixed. Seats 1-3 form Cycle A, 4-6 Cycle B, 7-9 Cycle C.
    2. Each cycle stands for election annually, producing staggered three-year terms.
    3. Senate resolutions require a simple majority unless specified otherwise.
  2. Consuls (Co-Chief Executives).
    1. Two Consuls elected directly by Members for two-year terms; may not serve consecutive terms.
    2. Serve as public representatives and presiding officers of the Senate; possess no unilateral spending authority.
  3. Continuity Committee.
    1. Three senior technologists selected by random lot from eligible Members; term length two years, staggered.
    2. Charged with preserving institutional memory and mediating disputes.
  4. Town Hall. Weekly meeting open to all participants; minutes publicly archived.

Article IV — Elections & Recalls

  1. Eligibility. Any Member with >= 6 months tenure may stand for Senate or Consul.
  2. Method. Single Transferable Vote (STV) administered via third-party cryptographic ballot; supervised by Continuity Committee.
  3. Recall & Dissolution. A petition signed by >= 40 % of Members triggers a recall vote; >= 66 % of all Members must approve to dissolve the Senate and call snap elections.

Article V — Powers & Checks

  1. Legislative Power. Senate sets strategy, budget, and policy.
  2. Executive Power. Consuls implement Senate directives and manage day-to-day operations.
  3. Hiring & Firing.
    1. Normal case: requires simple Senate majority.
    2. Founder Veto (see § V-6). Any Founder may veto a personnel decision within 48 hours of a Senate vote.
    3. Override. A 75 % super-majority of all Members may override a Founder veto within 10 days.
  4. Budget Formula. Out of each year's Distributable Surplus (as defined in Article VI-1), unless amended per Art. VI-3, the Senate shall allocate as follows:
    1. 40 % to Reserve Fund (12-month runway target).
    2. 40 % to R&D Fund.
    3. 10 % to Investor Allocation Pool (pro-rata among Class I after preferred dividend satisfaction).
    4. 10 % to Member Profit-Share Pool (equal per capita among Members).
  5. Salary Policy. Senate may adopt up to three salary bands (Junior, Senior, Principal) with a maximum 2x spread between lowest and highest band. Adjustments must apply universally per band.
  6. Founders' Special Power Sunset. The Founder Veto in § V-3 lapses automatically upon either (i) the 10th anniversary of incorporation or (ii) attainment of 300 Members, whichever occurs first.
  7. Recruiter Corps (RER).
    1. The Senate may appoint up to five (5) Retired Engineer-Recruiters ("RERs") at any time. Each appointment is for a one-year term and may be renewed indefinitely.
    2. RERs are contractors, not Members; they hold no equity or voting rights under this Charter.
    3. Each RER shall execute the Company's confidentiality and code-of-conduct agreements and must disclose all potential conflicts of interest to the Senate. The Senate may remove an RER for cause by simple majority vote.
    4. Finder's Fee. For each candidate ultimately hired through an RER referral, the Company may pay the referring RER a one-time finder's fee in accordance with the schedule approved annually by the Senate. Such fees shall be paid from the R&D Fund.
  8. Hiring Workflow.
    1. Origination. A candidate may enter the hiring pipeline via (i) an RER referral or (ii) a Member referral.
    2. Technical Panel. A panel of three (3) to four (4) Members — excluding any referring Member — shall conduct a single-session practical interview.
    3. Offer Prerequisites. An employment offer may be extended only if:
      1. The panel records a unanimous "Hire" recommendation; and
      2. At least five (5) of nine (9) Senators explicitly register electronic consent within forty-eight (48) hours of notification; a non-response shall be treated as a dissenting vote; and
      3. No Founder veto is exercised within forty-eight (48) hours after Senate consent (see § V-3 & § V-6).

Article VI — Finance & Distributions

  1. Preferred Dividend. Class I shares accrue a cumulative, non-compounding 6 % annual dividend on invested capital, payable only from Distributable Surplus.
  2. Profit-Share Pool. After satisfaction of Preferred Dividend, remaining Distributable Surplus is allocated per Art. V-4.
  3. Amendment of Budget Formula. Requires (i) two-thirds of seated Senate and (ii) majority of Class M votes and (iii) majority of Class I votes, voting as separate classes.
  4. Capital Raises. Issuance of additional Class I shares requires Senate approval and majority of existing Class I votes.

Article VII — Investor Protective Provisions

Without the approval of a majority of the outstanding Class I shares voting separately, the Company shall not:

  1. Materially change or waive the Preferred Dividend terms.
  2. Amend Articles II, VI, or VII.
  3. Authorize any liquidation, merger, or sale of substantially all assets.
  4. Authorize new securities senior to or pari passu with Class I.

Article VIII — Amendments to Charter

  1. Amendments require (a) two-thirds Senate approval, (b) two-thirds of Class M, and (c) two-thirds of Class I.
  2. Articles I (Legal Form), II, V-3 (Founder Veto/Override) and VII may not be amended before Founder Veto Sunset without unanimous Class M and Class I consent.

Article IX — Dissolution

Voluntary dissolution requires (i) Senate super-majority (>= 75 %), (ii) 75 % of Class M, and (iii) majority of Class I. Net proceeds distributed first to satisfy unpaid Preferred Dividends and return of Investor capital, then distribute any remaining assets 70 % to the Member Profit-Share Pool and 30 % to the Investor Allocation Pool, as those pools are defined in Article V-4.

Article X — Effective Date & Transitional Provisions

  1. This Charter becomes effective upon filing of the PBC Certificate with the Delaware Secretary of State.
  2. Initial Senate shall consist of Founders and two randomly selected Members for staggered terms (Cycle A year 1, Cycle B year 2, Cycle C year 3).
  3. Initial Consuls are the Founders for the first two-year term.

Executed on ______________, YYYY
Founders: ________________________
Members' Representative: ________________________
Lead Investor: ________________________


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