Why do B Corps matter? Research has shown that companies that align purpose with profit outperform their peers over time while also reaping the benefits of better customer loyalty, higher employee retention, productivity, and increased interest from investors. Recent events have sparked an increase in energy and awareness around the need for a more fair, inclusive, and sustainable capitalism. This has led to the growth of the “stakeholder-driven” business model, which has fueled the emergence of a new organizational form: the Certified B Corporation or “B Corp”
What are B Corps
Certified B Corporations, also known as B Corps, are businesses that meet the highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose. B Corps use the power of business to build a more inclusive and sustainable economy.
The global B Corp community of companies work toward reduced inequality, lower levels of poverty, a healthier environment, stronger communities, and the creation of more high-quality jobs with dignity and purpose. 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.
There are close to 4,000 Certified B Corp across the globe, and in the San Diego region alone, there are approximately 25, and that number is growing. You find B Corps in over 70 countries across 150 industries. B Corps come in all shapes and sizes: from one-person micro-businesses to multinational public companies.
B Corps are Better Businesses
B Corps have one goal in mind, and that is to redefine success in business. Here are some examples of why B Corps are better businesses.
- B Corps are 27% more likely to pay all their employees a living wage
- B Corps are 47% more likely to pay the majority of employee health insurance premiums
- B Corps outperform other businesses by 10% in providing high-quality jobs
- B Corps, on average, attract 2 times more applicants than non-B corps
- B Corps outperform other businesses by 16% on addressing climate change
- B Corps are 100% more likely to donate more than 1% of their revenue to nonprofits
- B Corps are 87% more likely to manage greenhouse gas emissions reductions
- B Corps are 3 times more likely to use 100% renewable energy
Why Become a B Corp
There has been a dramatic shift in society’s expectations of business’s role in addressing today’s economic, social and environmental challenges. Now more than ever, people want to work for, buy from, partner with, and invest in businesses they believe in. B Corps offers several unique opportunities for companies to put purpose alongside profits as they grow and solidify their mission.
According to B Lab, the nonprofit behind the certification, here are the top reasons why becoming a B Corp may be suitable for your business:
- Attract Talent: More and more of the workforce makes decisions about where to work based on the positive impact their work creates and how well an employer treats their team. There’s no better way to attract and engage mission-aligned talent than to verify your values with B Corp Certification.
- Lead a Movement: B Corps set the gold standard for good business and inspire a race to the top, creating performance standards and legal structures used by thousands of other companies worldwide.
- Build Relationships: When your company certifies as a B Corporation, you join a community of business leaders who share your belief that business can solve social and environmental problems. Connect online, meet in person at events, or build client and vendor relationships within a robust community of practice.
- Improve Impact: Maintaining B Corp Certification through the B Impact Assessment is a powerful mechanism to help your company set goals for improvement, create more positive social and environmental impact, and track performance over time.
- Amplify Voice: The third-party validation that comes with B Corp Certification helps your company stand out and stand by your mission. The B Corp seal on a product, website, sales materials, or business card instantly communicates that a company is a verified leader when it comes to positive impact and empowers individuals to confidently vote with their dollars.
- Mission Protection: Make sure your company is built on a solid legal foundation for the long term. The B Corp legal framework helps you protect your mission through capital raises and leadership changes and gives you more flexibility when evaluating potential sale and liquidity options.
The bottom line: It’s just good business.
How to Become a B Corp
If you want to become a B Corp, here’s how to make it happen:
- Assess Your Impact: Complete the B Impact Assessment, a free, confidential platform designed to help measure and manage your company’s positive impact on your workers, community, customers, and environment.
- Meet the Legal Requirements: Meet the legal requirements to consider your decisions’ impact on all your company’s stakeholders.
- Submit Assessment for Verification: Undergo a multi-step verification process to determine if you meet the 80-point bar for certification.
- Make it Official: Sign the B Corp Declaration of Interdependence, sign your B Corp Agreement, and pay your annual certification fees.
Be Like a “B”
Not ready to become a B Corp? You don’t have to become a B Corp to operate like one. Whether you’re a creative or professional services firm, a retail business, or a solopreneur working from home, your business can make a positive social and environmental impact. There are countless ways your business can integrate social responsibility—and here are ten practical ones to get you started:
- Encourage your employees to volunteer for a local charity. This can include organizing a “day of service” as a way to build teamwork.
- Offer pro bono services, or donate products in-kind, to help a nonprofit improve its impact.
- Measure your current energy and water consumption and set reduction targets. Recruit an “environmental champion” among your staff to help engage your team in finding ways to reduce your carbon footprint.
- Offer subsidies or other incentives to encourage employees to carpool or use public transportation.
- Involve your employees in decisions that impact their work environment. Empower them to make positive changes that result in greater efficiency and effectiveness.
- Provide training and mentoring opportunities that include personal and professional development.
- Offer a written consumer warranty or client protection policy on your product or service.
- Establish customer service standards and practices and set targets for improving customer satisfaction.
- Establish a Supplier Purchasing Policy that gives preferences to local suppliers, women-owned and minority-owned businesses.
- Establish a supplier Code of Conduct to ensure that your suppliers operate ethically and responsibly.
What to learn more about your own company’s social and environmental impact? Start measuring and managing your social and environmental impact using this free, confidential tool: http://bimpactassessment.net
To learn more about how San Diego B Corps are making an impact locally and globally, visit B Local San Diego. There you will find a list of San Diego certified B Corps as well as free resources for your business, including upcoming webinars and events.