If you’ve been around this ethical/sustainable business world for a little while, you would have heard about ‘B Corps’, touted as the new standard in corporate social responsibility.
But what are B Corps, and are they really as impactful as everybody seems to think?
The Community of B Certified Corporations (https://www.bcorporation.net/) sums it up as follows:
B Corporations represent an emerging group of companies that are using the power of business to create a positive impact on the world and generate a shared and durable prosperity for all.
Good…. I guess. But what does it mean?
The more we dig around, the more we’re met with platitudes; “B Corp certification is to sustainable business what Fair Trade certification is to coffee.”
Sure. I get it, you guys are good and doing good things. But how, and why is it important?
Finally, an answer:
Here’s the low-down. A B Corp is the same as any other Corporation, except it is certified to be more cognizant of its broader responsibilities as a member of our society, and orients its business activities with these responsibilities in mind.
Specifically, the process of becoming a Certified B Corp involves a rigorous assessment of the company’s governance, transparency, environmental and social impact. An applying company is given a point score, and will be Certified if it scores higher than 80 – not an easy thing to do across all these areas.
Having said that, some companies blow this score out of the water – everyone loves Patagonia, but even we were surprised when they turned in an impact score of 107!
So it’s hard to argue that for any company, focusing on these four areas is going to be a bad thing overall. The challenge is ingraining these values in your corporate culture to an adequate extent that you score well on all of them. That is no mean feat.
Even more so when you consider that, for a lot of companies, the interests of investors / shareholders also need to be considered. More relevantly, the views of investors have to be countenanced in corporate decision-making. This is never an argument we’d make, but there are those who say the responsibility of a company to its shareholders (that is, to earn maximum profit at all times) is in conflict with the ideals of the B Corporation, which require it to take into account its broader responsibilities to society.
This certainly is a narrow-minded view, which completely fails to countenance the possibility that the interests of shareholders might actually be served by a greater emphasis by management on the triple bottom line. Indeed, as more and more consumers demand more sustainable products and services, it’s becoming increasingly obvious that focusing on meeting this demand can actually add to a company’s profit centre.
Should My Company Move Towards B Corp Certification?
Plainly, the answer is yes. And there are a lot of reasons for this. The obvious ones include that moving towards sustainable business is good for society, as well as the health of your business. But there are more important tangible benefits – when you start focusing in on the four areas isolated in a B Corp assessment – governance, transparency, environmental and social impact – it forces you to focus your energies on those areas that are normally the easiest to ignore. And B Corporations like Etsy have reported other, unforeseen advantages of going through the process, including energising their staff under a common mission of doing better together.
There is currently no Certification scheme that compares with B Corp in its scope, participation or potential to make a real impact. If you are in a position to start the process, you can give your company a preliminary health check via the B Corp impact assessment tool here: http://bimpactassessment.net/. Whether or not you decide you want to complete the process, you will at the very least come out with some ideas for how you can – and must – do better.