Openai is reorganized and retreated under the promotion

The newly proposed structure can control nonprofits, although Monday’s blog post doesn’t give a detailed look at what exactly would look like. The company stipulates that its current for-profit subsidiary will become a public welfare company (PBC), the way its competitors Human and XAI. PBC is legally allowed to prioritize shareholders and social interests.

"Nonprofits will control and become the major shareholder of PBC, providing nonprofits with better resources to support many benefits," OpenAI's blog post said. "Our mission remains the same and PBC will perform the same mission."

Delaware Attorney General Kathy Jennings said in a statement to Wired that she was encouraged by Openai for considering her concerns and allowed nonprofits to retain control. "Now that the company has a new plan, I intend to ensure it complies with Delaware law by ensuring it complies with OpenAI's charitable purposes and retaining appropriate controls for the for-profit entity," Jennings said.

California Attorney General Rob Bonta's office did not immediately respond to a request for comment.

Robert Weissman, co-president of public citizens who advocate for large corporations, said the startup's plans remain unsatisfactory. He claims there seems to be no new restrictions to ensure compliance with OpenAI's nonprofit mission, which is to benefit all humans with powerful AI tools. "This took us out of our position, a nonprofit that allegedly controls for-profit, but has no obvious restrictions on for-profit," Weissman told Wired.

Openai's plan calls on its new nonprofit organization to hold stakes in public welfare companies. A recent financing has valued Openai at $300 billion, so these stocks can be very profitable because nonprofits sell or borrow. California philanthropists have called on nonprofits to obtain "fair value" stocks, which could lead to it being the most funded foundation ever. They also want nonprofits to be independent of the company so that corporate interests do not undermine charitable donations. On Monday, activists applied to Bonta to call on Bonta to closely review whether Openai's plan would achieve the separation.

"Openai is not a regular company, never," Altman wrote in an email to employees included in the company announcement.