What’s all the fuss about B Corps? What are they? Why do they matter, and why is there a great future in B Corps?

B Lab, the nonprofit that provides the certification to businesses, describes B Corps like this:

B Corp is to business what Fair Trade certification is to coffee or USDA Organic certification is to milk. B Corps are certified by the nonprofit B Lab to meet rigorous standards of social and environmental performance, accountability, and transparency. Today, there is a growing community of more than 1,000 Certified B Corps from 33 countries and over 60 industries working together toward 1 unifying goal: to redefine success in business.

dojo4 just went through the certification process and we are now proud to be a bona fide B Corp. Having worked on a farm in a former life, I thought of it very much like getting an organic certification. As a farmer you may already shun the use of pesticides and practice other environmentally sustainable farming methods, but an organic certification lets people know that you are sticking to a set of standards and gives you guidelines for ensuring the purity of the land you work and the food you produce.

B Corporations are triple bottom line businesses that set specific standards for social and environmental performance. Tweet This Quote

As a tech and design company, we rejected being purely profit-driven and set out to do business with the recognition that we are all interdependent. By getting B Corp certified, we let people know that we are backing up this understanding of interdependence with a standard of practice and are giving ourselves the support of guidelines to stick to.

The assessment is a real doozy (our application was 50+ pages long and took us a year to achieve), but the application process itself got us on our game, and we are already seeing the benefits of being certified. There are a lot of reasons to become certified, but here are at least 5 benefits that you can expect:

1. It’s great marketing.

Becoming a B Corp is a brilliant way of proclaiming who you are, what’s meaningful for your company, and what you stand for. Tweet This Quote

It’s a brilliant way of proclaiming who you are, what’s meaningful for your company, and what you stand for. You are letting people know that you care about human and environmental health and integrity. Like-minded clients, partners, prospective employees, and customers are looking for you. This helps them find you.

2. It puts you in good company.

Becoming a B Corp lets you join the ranks for other companies doing great things. This isn’t just good marketing—B Corps also respect and share with each other, which is good for business and good for the ecology of a socially responsible economy.

3. It makes you be even better.

In order to become a B Corp, your organization has to get score of at least 80 out of 200 on the stringent Impact Assessment. Even the highest scorers tend to achieve a rating in the lower 100s (we scored 88.5), which means that even the best of us can aspire to do better. A B Corp certification provides a set of standards to make you better at what you are already setting out to do.

B Corp certification provides a set of standards to make you better at what you are already setting out to do. Tweet This Quote

4. It supports and includes you in a thriving movement.

Just one word(s): B Corps. Triple bottom line businesses that set specific standards for social and environmental performance are where it’s at.

5. It lets you, rather than your shareholders, decide what’s best.

By becoming a B corp, your company declares its dedication to valuing the interests of stakeholders as much as (or more than) the interests of its shareholders. In this way, being a B Corp provides a company with some protection against pressure from investors. It makes it clear to your shareholders from the get go that your bottom line will always include people, planet and profit.

No time like the present to give your company the benefits of becoming a B Corp—don’t let the way of the future pass you by.

About the author

Corey Kohn

Corey Kohn

Corey is the COO of dojo4, a creative software design, development and media team in Boulder, Colorado.

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18 Comments

  • We hear this term everywhere it seems, so i am happy to get dojo4’s perspectives on what a B Corps certification means for her business. I was particularly intrigued by points 3 and 5 in the article, namely that the certification process sets standards so high that clear pathways for improvement are continually contemplated. Also that your business has a clear commitment to focusing on the triple bottom line and putting stakeholders needs in fron of shareholders’ needs. Let’s hope this continues to grow!

  • Thanks for the interest and support, Jerry!

    The obvious and nuanced benefits of the B Corp certification and community membership are unfolding daily for us. Being welcomed into the community will certainly contribute to powerful long-term relationships. And even though it’s only been half a year since certifying, re-certification is required every two years, so we’re already and constantly thinking of ways to lift our standard and innovate on improvements. For us that’s meant things like working with B Labs to start thinking about making the assessment more comprehensive for tech companies like ours- we’re working with the organization and other similar B Corps to add assessment categories like open source contribution and measuring cloud-based / server energy usage. My sense is that as long as this is a useful certification, that any company would benefit by taking the assessment and aim at becoming certified.

  • Thanks for the article. I can see how being a Certified B Corp could be beneficial in many ways. In my opinion, gaining trust from the consumer is one of the greatest positive impact. At the same time, it also keeps you on your toes. The passing score of 80/200 suggests that we still have a lot of room for improvement.

    I was wondering though…Has any controversy been raised for B Corporations Certification? I read a bit into that and didn’t really find anything striking, which mean it’s a good thing. My concern is that with any certification, comes judgment. For example, Starbucks is once condemned to set its own rules for Fair Trade Coffee and LEEDS certification is known to favor or makes ties with certain suppliers.

  • Having gone through the arduous task of forming a 501c3 non-profit I feel the pain of becoming a B Corp. That said I think there are many benefits to the process as stated above-if nothing else the credibility and marketing benefits it gives a business to the public.

  • I really like the way of narrowing down to 5 core benefits in order to being able to articulate maybe in more effective manner it to those who are just at the beginning or never heard of it. In your comments I can also see one of the main benefits. Going through the official path of certification makes you more aware and helps you with designing operations and everything else even better. I would imagine it truly helps you to see what is included in making that triple bottom line.
    Regarding the benefit #5 I would maybe argue that whoever is investing in B corp recognizes and accepts that they have interest in the success of company through the triple bottom line and thus you can´t separate them only into the category of shareholders whom care only about direct monetary benefit to their shares. This way, I think by traditional definition (which is completely outdated) there are no shareholders whom would be only interested in appreciation of stock with profit that is not tied to any other value than monetary.

  • I really like the explanation of what B corps are, what they do and why it matters. I would like to have a structure that emphasizes the social and environmental impact the company works towards, but for a startup it would be very time consuming. My plan is to start as a LLC because it is the more cost efficient, flexible, and it allows me to launch my company quicker. I do feel the B corporation provides benefits that are valuable, but I see more of a benefit for the B corporation after the company has passed its breakeven point and is making revenue. I will market the mission, vision, and social and environmental benefits the company helps, but will not start as a b corporation.

  • Thank you for asking this question Kat. I have been wondering the same thing myself. For instance, having owned a farm where we tried to do organic certification, we decided that the process was too cost prohibitive for us as a small farm and decided to ramp up consumer education on our sustainability practices instead. Additionally, I do not trust certification alone. An animal that is “cage free” may still have been raised in horrendous, cramped conditions but with a tiny door where they could in theory go outside. I do not yet know enough about B Corp certification to know if any similar issues exist, but I imagine that they probably do because some flexibility must be built in to these certification processes to allow businesses to function (for example, to be certified as organic you do not need to use organic seed because it is more expensive and difficult to purchase large quantities). I agree with this list that Corey Kohn developed (thank you!) and am excited to learn more about what B corp certification entails. I still hope that consumers will be diligent though and research the companies they buy from.

  • Really enjoyed this article. Have studied a few B-corps and the rigorous processes required to certify, monitor, and report. It’s nice to see many of the benefits clearly articulated in these five points. The second point mentions “sharing” so that all B-corps benefit from the collective experience. Patagonia – a certified B-corp – shares proprietary technologies with competitors to maximize the reach of any environmentally-friendly production improvements. Their founder, Yvon Chouinard, has coached Walmart in their sustainability efforts to maximize their reach.

    The fifth point is very interesting because it’s written exclusively from the founders perspective. What’s so powerful about the B-corp model is that the founder and shareholders create a compact. It’s true that the business declares its “benefit purpose” and that shareholders can either support or reject that purpose with their dollars. Equally important is the investor, who holds the company and its executives accountable to the stated benefits purpose. If a company moves too far from their benefits purpose, the board and shareholders have a responsibility-akin to their fiduciary role-to course correct.

  • This was a great read! Point number 3 really makes sense to me. Id like obtain an application simply as a regulatory measure or as a goal setting assignment. I would used the application as a growth tool, becoming B certified has leads to such great outcomes that even if I know I don’t meet the standards yet, it would be fantastic to know exactly what we are working for. How would one go about getting an application to use as a point of reference?

  • I think one of the most important things that B Corporation (the nonprofit behind B Corp) has done is to lobby for states to offer a legally binding incorporation option similar to the B Corp certification, but that allows businesses to actually incorporate as a benefit corporation. The first state to do so was Maryland in 2010, and since then, 27 states and DC now offer that option. This article overviews the differences between the two entities, and raises some good points about why it is important to know the difference.

    http://ctinnovations.com/resource/70/BCorpsvsBenefitCorps

    Unfortunately, only Connecticut offers a “legacy preservation” option in its incorporation articles; in all other cases — legally incorporated benefit corporations and B Corp certification entities — when ownership changes hands, the new owner can drop the certification or change the legal structure to rid itself of social and environmental responsibility. The White Dog Cafe in Philadelphia is a case in point. When the original owner sold, despite the fact that the new owners promised to maintain the mission-driven aspects of the business, they dropped the B Corp certification soon after the sale.

    If I could wave a magic wand and make one, single change to the American business and political landscape, it would be that all businesses have to adhere to the principles of B Corp.

  • The assessment is pretty intensive but someone with a week or so of dedicated time could get it done- plus there’s a lot of help available from B Labs. Once you submit the certification, it’s usually no more than a week or two until you get the certification, as long as the assessment passes. That being said, the organizational will has to be there and be focused to make it happen – we tried once without those things in place, and so it wasn’t until a year later that we were actually able to hunker down and finish it up. It does take significant founder/owner level engagement to answer some of the questions and make some of the changes they require (such as to HR policy and bylaws).

  • Hi Maria- Anyone can take the assessment at anytime and as many times as you like: http://bimpactassessment.net/. The quick snapshot assessment allows you to see what kind of questions are asked and the categories being measured, without having to delve into the full assessment right away. Whether or not you decide to try to certify, the assessment is, as you say, a great growth tool.

  • Hi Corey, I am currently doing a dissertation involving benefit corporations. Until I started I didn’t know much regarding B corps to be honest it was only recently I knew what they were. I found your page very insightful. Thank you.

    Is there any possibility I could email you with a couple of questions regarding B corps? I would be great to get a view from someone who has went through the process.

    Thanks
    Hannah