Written By: Khary Dvorak-Ewell, Senior Associate
How can a business be the best in the world and be the best for the world? Can we use the power of business to address the world’s most pressing challenges?
Our friends at B Lab are answering these questions—and transforming our economy. In an effort to encourage and reward socially-responsible companies, B Lab created a certification program for entrepreneurs who use their businesses as a force for good. The organization also championed legislation that offers Benefit Corporations recognized corporate legal status.
In June, Green For All was happy to host Andy Fyfe, Community Developer with B Lab, and Neha Kumar, Analytics Associate with GIIRS (Global Impact Investing Rating System), in a webinar. In case you missed the presentation, we’re including a brief overview below. You can also download the slides to the full presentation.
About B Lab
B Lab is a non-profit organization forging a path for a new type of business dedicated to leaving the world a better place. B Lab developed the B Corp Certification and Benefit Corporation status to address two critical issues for sustainable businesses:
- Current corporate law makes it difficult for businesses to take employee, community, and environmental interests into consideration when making decisions.
- The lack of transparent standards makes it difficult to tell the difference between a 'good company' and just good marketing.
About GIIRS (Global Impact Investing Rating System)
GIIRS is an online rating and analytics tool for impact investing. It provides businesses and funders with an independent third-party rating of an organization’s impact on its community and the environment. GIIRS is designed as a “comparable, transparent and easy to use” rating for businesses to gauge their impact in six key areas: governance, workers, community, environment, community products, and environmental products. For more information visit the GIIRS website.
B Corp Certification
The B Corp label is similar to Fair Trade labeling—companies must pass an independent assessment in order to be certified. Over 560 leading corporations have already joined the community of Certified B Corps businesses. Companies like Numi Organic Tea use the B Corp label to distinguish themselves in the market as businesses that are environmentally and socially responsible.
The B Corp label helps the bottom line: Certified businesses have seen benefits in increased cost savings (some have seen much as a 10:1 return on investment on their certification fees), investor interest, brand differentiation, media exposure, and the ability to maintain a purpose-driven mission. For more information on the assessment and certification process, you can read the B Corp certification overview and step-by-step instructions.
Benefit Corporations Legislation
Through the diligent efforts of B Lab, the certification has expanded into a recognized legal corporate status for Benefit Corporations that commit to doing business in a socially responsible and environmentally friendly way. For a list of states that recognize Benefit Corporations, click here.
Businesses certified as B Corps and those registered as Benefit Corporations have legal structures that expand standard corporate accountability; this enables leaders to make decisions that are good for society, not just their shareholders. Benefit Corporations commit to uphold the following values as a central part of the way they do business:
- Purpose: They have a corporate purpose to create a material positive impact on society and the environment.
- Accountability: They expand fiduciary duty to require consideration of the interests of workers, community and the environment.
- Transparency: They publicly report annually on overall social and environmental performance against a comprehensive, credible, independent, and transparent third party standard.
Businesses can continue to seek B Corp certification—or they can take it to the next level by registering as Benefit Corporations. Some cities like San Francisco are even working on legislation that would give registered Benefit Corporations additional points in a graded system the city uses for bidding contracts—rewarding them for committing to doing business in a socially-responsible way.
B Lab’s innovations are not only enhancing the way business is done—they’re also creating a new economic sector in which profit, people, and planet are all counted as measures of success. For more information on B Lab, visit www.bcorporation.net, and to learn about other Green For All business webinars visit our newly redesigned website at www.gfa.fchq.ca.