Introduction to the B Corporation Movement
Updated: May 12, 2021
By: Callie Yow
Beginnings of the B Corp Ideal
The B Corporation movement is possible because of the ambition of companies to use their business as a force for good and as a method of turning societal ideals into action.
Consider outspoken brands like Ben and Jerry’s and Patagonia. Since 1978 Ben and Jerry’s has utilized their marketing strategy to advance social responsibility. As a result, Ben and Jerry’s stands out on the shelf and during pivotal social movements. Similarly, Patagonia has engaged in ingenuous business practices and proactive community minded programs to contribute to an equitable and inclusive environment both in the store and in society since 1973.
In 2006, the B Corporation movement was founded to challenge outdated business models prioritizing shareholder value instead of equitable practices for stakeholders. The B Corporation certification recognizes long-term planning and purpose as equally important to profit. This distinction offers a foundation on which businesses can identify, assess, and improve their operations to drive greater positive impact.
What is a B Corp?
On its website, B Corporation describes the movement as follows: “By harnessing the power of business, B Corps use profits and growth as a means to a greater end: positive impact for their employees, communities, and the environment.”
Figure 1: Source: bcorporation.net
Certified B Corporations are companies that have met strict requirements in five focus areas: governance, workers, community, environment, and customers. Companies are evaluated by B Lab and given a score between 0 and 200. To become a certified B Corp, the company must score a minimum of 80 points. The B Corp movement creates a collaborative space for brands to collectively build a community from shared value in the triple bottom line of people, planet, and profit.
Both B Corps and benefit corporations offer more transparent practices, but they are not the same. On one hand, the B Corporation Certification is a third-party certification administered by B Lab based on a company’s performance using the impact assessment tool. On the other hand, benefit corporations are legal structures for a business with legal accountability or interest to pursue positive stakeholder engagement.
The B Impact Assessment
The B Impact Assessment (BIA) is a free tool available to anyone interested in gaging their company’s impact before committing to the certification process. This assessment tool provides a standardized framework for measuring impact on stakeholders, allowing businesses to better understand their social and environmental performance in clear terms.
Pursuing the B Corp certification is a forward-looking step toward improved corporate social responsibility and elevates processes within your business model while highlighting brand purpose. Becoming certified does expose your business in areas where improvement may be needed. This exposure accredits your company as transparent and customer focused. Just make sure you can address and improve upon those blind spots realized through the assessment.
Reasons to Certify and Some Considerations
Certification as a B Corporation differentiates a business from its competitors and provides numerous benefits including: allowing relationship building, attracting like-minded talent searching for socially conscious companies, amplifying the brand voice, and improving overall measurable impact.
Despite the many positives that come from joining this community driven by purpose and integrity, there is associated risk. B Lab requires a rigorous process in which companies must provide proof of their organization’s operations and an annual fee is required to keep the certification active. This cost is calculated based on the company’s annual sales and may exclude smaller companies with a lower budget or fewer employees.
Further, while certification is a great way to improve accountability, it can also be a stressful process that makes it difficult for a business to correctly quantify their impact while answering the questionnaire.. There is not a grayscale, which can be either a positive or a negative depending on your company’s processes.
The B Corp certification is the only holistic review of a company’s performance and may be worth the intensive certification process. Consider how the certification would improve your business, most importantly how you would build upon your current mission statement to achieve your company goals.
The Future of B Corp
The B Corp certification is more than just a credential— it is a movement that challenges businesses to be a force for good through purpose-driven actions that create positive change. Customers can support companies, (such as Seventh Generation, King Arthur Flour, and New Belgium Brewing), that are prioritizing positive social, economic, and environmental impact by using B Corporation’s search function.
Since B Corporation’s founding in 2006, over 3,800 companies across 150 industries have joined this community. It is incredibly encouraging to see brands from all over the world engaging in conversations that place people and planet ahead of profit so we may collectively grow to new models focused in addressing the triple bottom line.
Callie has a strong appreciation for the natural world and combines her passions for writing, relationship building, and environmental justice to advocate for better management of materials in her personal and professional life. She currently manages corporate relations at a nonprofit that plans and operates paint stewardship programs to keep paint out of the waste stream.