How Are B Corporations Changing Business?
Fifty years ago if someone were to suggest that thousands of organisations, big and small, would voluntarily pay to be scrutinised from the inside out on how committed they are to treating people well and helping the planet, they would have been laughed out of the room. But here we are in 2023 and businesses are lining up for such scrutiny, all hoping to obtain a B Corporation certification.
What is a B Corp?
In a corporate climate of greenwashing and empty promises, a B Corp certification offers businesses the chance to prove they are serious about purpose, and it has attracted big names: Coutts Bank, Allbirds and The Body Shop to name a few. The certification is administered by the non-profit B Lab, which has a vision of purposeful business spreading across the world. Getting the certification requires a rigorous assessment of how the company balances purpose and profit, split into stages:
- Initial Assessment: The B Impact Assessment, or BIA, is a free online tool used by over 50,000 businesses to measure an organisation’s impact on its workers, community, environment and customers. It’s also the first step when applying for a B Corp certificate. To maintain certification, the BIA has to be re-submitted and verified every 3 years.
- The Legal Stuff: Businesses then need to use B Labs’ Legal Requirement Tool to evaluate how the company can integrate stakeholder consideration into the governance structure.
- Verification: B Lab will then verify the company’s score to determine whether it has met the 80 point standard needed for certification.
- Sign and pay: Once verified, all that’s left to do is sign the Declaration of Interdependence and pay the annual certification fee, which is related to the annual sales of the company.
In other words, organisations voluntarily pay to be scrutinised from the inside out in order to prove they are committed to people and the planet. It’s a challenging process that can take up to 10 months to complete, and only 1 in 3 companies are likely to achieve certification. Learn more about the certification requirements here.
Who’s part of it?
The B Corp community believes that through a community of like-minded leaders, the movement to use business as a force for good can spread across the globe. From a traditional capitalists perspective B Corp certification may sound unnecessary and potentially damaging, but more and more companies, big and small, are proving that it’s worth it.
Global names like Danone, Patagonia and Ben & Jerry’s have all joined the ranks. There are 1,100 B Corps in the UK – up from under 100 in 2015 – and 6000 globally. As well as the endorsement of certification, B Labs offers these companies access to knowledge-sharing series, working groups and social events.
Speaking at the launch of B Corp UK in 2015, Paul Polman, former CEO of Unilever, positioned himself as a leader within the B Corp community. He stressed that “Unilever actively welcomes the launch of the B Corp movement in the UK,” and that the journey to becoming a B Corp is “difficult, but much easier if we do it together … The challenge for this movement is scale – it must expand geographically.”
Whose idea was it?
In 2006, Jay Coen Gilbert, Bart Houlahan and Andrew Kassoy left their careers in business and private equity in order to start an organisation dedicated to helping for-profit companies become a force for good in the world. B Labs was founded, and it recognised there was a demand for capitalism to change: 72% of the UK public think that capitalism either isn’t working or is harmful, while 76% believe businesses should have a legal responsibility to protect the environment. They came up with the idea for a voluntary certification that was founded on transparency, accountability, sustainability and interdependence. The B Corp Certification was born.
“Society’s most challenging problems cannot be solved by government and non-profits alone.”
B Corp UK
For B Corporations, growth and profits should be the journey – not the destination. The end goal is bigger than that: it’s about being a force for positive change in society. B Corps recognise their own power and work to use that power for good. Getting certified is just the start of the journey: as it says in the B Corps story, the hard work never ends. But it’s also never been more positive, more powerful, and more purposeful.
“We need to prove that businesses can work for the benefit of society.”
B Corp UK: What will be your legacy?
