OpenAI Backs Down on Restructuring Amid Pushback

“The nonprofit will control and also be a large shareholder of the PBC, giving the nonprofit better resources to support many benefits,” OpenAI’s blog post said. “Our mission remains the same, and the PBC will have the same mission.”

Delaware attorney general Kathy Jennings said in a statement to WIRED that she is encouraged by OpenAI taking into account her concerns and allowing the nonprofit to retain its control. “Now that the company has a new plan, I intend to review it for compliance with Delaware law by ensuring that it accords with OpenAI’s charitable purpose and that the nonprofit entity retains appropriate control over the for-profit entity,” Jennings said.

Elissa Perez, a spokesperson for the California attorney general’s office, said in a statement that her office is also is reviewing the new plan.

Robert Weissman, co-president of Public Citizen, which advocates against big corporations and has long criticized OpenAI’s structure, says the startup’s plans continue to be unsatisfactory. There do not appear to be any new limitations to ensure the for-profit adheres to OpenAI’s nonprofit mission of benefiting all of humanity with powerful AI tools, he claims. “This leaves us where we are, which is with a nonprofit purportedly controlling a for-profit but exercising no visible restraint on the for-profit,” Weissman tells WIRED.

OpenAI’s plans call for its new nonprofit to hold shares in the public benefit corporation. A recent funding round put OpenAI’s valuation at $300 billion, so those shares could be extremely lucrative as the nonprofit sells or borrows against them. California philanthropic activists have called for the nonprofit to get a “fair value” of shares, which could lead it to become the most well funded foundation ever created. They also want the nonprofit to be independent from the company, so that business interests do not corrupt philanthropic giving. On Monday, activists renewed their call for Bonta to closely review whether OpenAI’s plans will achieve that separation.

OpenAI spokesperson Steve Sharpe said the nonprofit will have the right to appoint and remove board members from the public-benefit corporation. “Moving to a [public-benefit corporation] will remove the capped-profit structure,” he added. “The PBC will have a conventional capital structure that lets employees, investors, and the nonprofit hold equity directly.”

“OpenAI is not a normal company and never will be,” Altman wrote in an email to employees that was included in the company announcement.

Update 5/5/25 7:35 ET: This story has been updated to include additional comment from OpenAI and the California attorney general’s office.