Getting from A to B: all about B Corporations

You may have noticed a prominent ‘B’ in a circle within a seal stating ‘Certified B Corporation’ – on a tub of Ben & Jerry’s ice cream, or a Divine chocolate bar, or a tag hanging from a Patagonia jacket. Even Coutts, the private bank, hit the news recently when its certification came through; the Guardian (itself a B Corp) declared, ‘“The Queen’s bank” Coutts joins the ranks of ethical brands.

What is a B Corp?

The ‘B’ in B Corp stands for ‘benefit’ and ‘corp’ stands for ‘corporation’…so please do pronounce the ‘p’! The roots of B Corps go back to 2006, when the nonprofit B Lab was founded in the U.S.

Certified B Corps are a new kind of business that balances purpose and profit. They are legally required to consider the impact of their decisions on their workers, customers, suppliers, community, and the environment. This is a community of leaders, driving a global movement of people using businesses as a force for good.

bcorporation.uk

Today there are more than 4,000 B Corps in 77 countries. Since the first UK companies were certified as B Corps in 2015, growth has been explosive and today there are 430 B Corps in the UK, representing 48 industries, 22,000 employees, and a combined revenue of £4.3 billion.

How does a company become a B Corp?

Becoming a Certified B Corp is a rigorous process. The B Impact Assessment, covering the pillars of governance, workers, environment, customers and community, needs to be filled in. Example questions include:

  • ‘What information does the company make publicly available and transparent?’ (Governance)
  • ‘What percentage of employees has been internally promoted within the last 12 months?’ (Workers)
  • ‘What percentage of [business] energy use is produced from renewable sources?’ (Environment)
  • ‘Do any of your company’s products/services address a social or economic problem for your customers and/or their beneficiaries?’ (Customers)
  • ‘How does your company take part in civic engagement?’ (Community)

Some of the questions change according to answers provided on previous questions. Most questions are worth a certain number of points, or fractions of points, with a maximum overall score of 200. The threshold to apply for certification is 80 — and it’s not easy to get there! One requirement is to change the company’s Articles of Association to reflect a triple bottom line ethos, showing that stakeholders include not only shareholders and their profits, but people and planet as well.

Governance metrics like revenue and net income have no associated points, as is true for a disclosure questionnaire covering areas like alcohol, mining, gambling, fossil fuels, tobacco, and firearms.

The score of Certified B Corps is publicly visible on the directory. Only for-profit companies can become B Corps, though any organisation can use the open-source B Impact Assessment tool, which provides a great deal of value in itself.

B Lab has more recently introduced the SDG Action Manager so organisations can take action, track progress, and transform the world in alignment with the United Nations Sustainable Development Goals.

With the rise of B Corps’ profile and popularity, the queue to be certified has gotten longer, with up to eight months’ wait for the initial evaluation, and then up to nine further months for the next stages of evaluation, verification queue and verification. So best to get started early!

There’s a submission fee of £250 + VAT and an annual certification fee which depends on company revenue.

B Corps need to recertify every three years, with a focus on continual improvement and requirements becoming more stringent. It’s certainly not a tickbox exercise. (Here’s an interview with a US-based B Corp going through recertification.)

What are the benefits of becoming a Certified B Corp?

With the transparency of the directory, Certified B Corporations can demonstrate exactly how perform on the rigorous B Impact Assessment. Though the actions each company needs to take to gain the minimum 80 points will vary, all improvements will benefit the areas covered within the framework: governance, workers, environments, community and customers.

The process itself offers an opportunity for engagement with stakeholders ranging from employees and management to suppliers, customers, nonprofits, industry associations, local and national governments, civic society, and local (or indeed global) communities.

The B Corp logo is gaining wider and wider business and consumer recognition. Certified companies can access its thriving networking forum called B Hive, and there are possibilities of partnerships, networking and even discounts from fellow B Corps.

Can I do this all on my own?

Yes, you can. But will you? On our team is a B Leader, someone trained by B Lab to help companies complete the B Impact Assessment and create a roadmap to meet all the standards required. Becoming a B Corp has been on our to-do list for years, but it took handing the reins to a B Leader to actually get the submission in. And now we’re very happily waiting in the up-to-eight-month queue. This October, I’ll train to be a B Leader and we look forward to helping more companies on the B Corp journey.

If you’re interested in support to have your company become a Certified B Corp, do get in touch!

With research and writing contributed by Katia Smith.

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