B corporations (or B corps), and benefit corporations, are for-profit companies that have a stake in not only driving up their stakeholders’ price-per-share, but also in trying to bring about solutions to environmental concerns, social issues, their workers’ benefits, and sustainability overall. Which means, these companies strive to make an impact on a global scale, not merely in profitability and sales, but in change for the better.
Although they sound similar and may share common goals, B corporations are not the same as benefit corporations. B corps differ in a substantial way from benefit corporations. They must pass rigorous standards to label themselves as B corps, and if they fall short of their altruistic aims, they can easily be stripped of this exclusive status.
B corporations are regulated by a nonprofit body in Pennsylvania called the B Lab, which oversees that certain criteria are met for both admittance and retention, much like “what LEED certification is to green building or Fair Trade certification is to coffee.”
Benefit corporations are companies which have gotten legal certification by the state (currently, 26 states and the District of Columbia legally recognize this status), but they are not certified by B Lab or any other third-party.
These two types of companies also differ in to whom (and what) they report as well; each B corporation must achieve a minimum score on the B Impact Assessment, which grades performance in environmental and social influence.
Benefit corporations on the other hand, must submit to the state annual records which will be assessed according to social and environmental impact, but unlike B corps, this report must not be turned over to a third-party source.
B corporations, like Ben & Jerry’s and Warby Parker, the hip sunglass online retailer, are now the bleeding-edge vanguard of corporate sustainability. At a time when large corporations are seen in a somewhat less-than-flattering light, B corporation designation shows a brand which is committed to the community and environment as much as it is to its stockholders.
Once listed on B Lab’s B corporation list, companies can even expect to receive assistance with their marketing and PR from the Pennsylvania 501(c)3 nonprofit. As befitting their global worldview and activism, there are more than 1,160 B corporations in 37 countries worldwide.
As has been shown before, a steadfast, top-down pledge of sustainability increases employee retention, creates a more affable brand story, and lures in new-hire prospects.
According to a survey by Net Impact, 80% of 13-25 year olds would rather work for a company that cares about its environmental impact, that is to say, a green company.
If B corps are the natural progression of they way business looks in the 21st century, away from what stockholder-married, anything-goes businesses were in the 20th century, they have shown that there is a traceable, growing trend toward sustainability in the global community (and the global market) today.
We’ve seen the rise of corporate social responsibility (CSR) and corporate sustainability—B corps are the logical offspring of these movements.
‘Transparency’, ‘accountability’, and ‘innovation’ are all buzzwords we’ve heard over and again, yet B corporations have a real chance to effect changes in the way business is approached and thought of. And though they may only comprise a tiny fraction of companies today, united by one common goal, and overseen by one regulatory body, they are at the vanguard of a green revolution that everyone in the marketplace must take note of to continue to stay top-of-mind.
If you would like to learn more about B corporations or corporate sustainability, call Hazardous Waste Experts today at 800-936-2311 to speak with a specialist or click here to email us.
Photo credit: B Corporation Blog