B Corp Certification is a strategic move for businesses determined to positively impact society, employees, the community, and the environment. This blog post will provide an overview of B Corp Certification, its importance, and how to achieve it.
What is a B Corp?
B Corp, short for Benefit Corporation, is a certification issued by the non-profit B Lab to companies that meet rigorous social and environmental performance standards, accountability, and transparency. Certified B Corporations are new business that balances purpose and profit, ensuring they work towards benefiting all their stakeholders, not just shareholders.
Why is B Corp Certification Important for Social Entrepreneurs?
Validation of Social Commitment: Certification as a B Corp provides external validation of a company's commitment to social and environmental issues. It helps build credibility and trust among customers, employees, and investors who want to support businesses that align with their values.
Community and Network: Certified B Corps join a community of over 3,500 companies from 70 countries and 150 industries that share the goal of using business as a force for good. This network provides opportunities for collaboration, partnership, and learning.
Attracting Impact Investment: B Corp Certification can attract impact investors, a rapidly growing group of individuals and organizations who invest in companies aiming to achieve financial returns while creating positive social and environmental impacts.
Real-World B Corp Example: Patagonia
Patagonia, an outdoor clothing and gear company, was among the first to receive B Corp certification. They have consistently demonstrated a commitment to environmental stewardship, fair labour practices, and corporate transparency3. They use their business to inspire solutions to the environmental crisis and donate 1% of sales annually to grassroots environmental groups.
How to Achieve B Corp Certification?
Obtaining B Corp certification involves a rigorous assessment process:
B Impact Assessment (BIA): This is the initial step towards certification. Companies need to score at least 80 out of 200 points on the BIA, which measures their impact on stakeholders, including workers, community, environment, and customers.
Meet Legal Requirements: Depending on your company's location, it may need to alter its legal governing documents to incorporate stakeholder consideration into decision-making processes.
Sign B Corp Declaration of Interdependence and Term Sheet: These agreements legally bind the corporation to consider stakeholder interests in decision-making and uphold transparency.
Certification Fee: A sliding scale annual certification fee based on a company's annual sales.
B Corp certification offers a powerful way for social entrepreneurs to differentiate their businesses, validate their commitment to societal and environmental impact, attract impact investment, and join a community of like-minded businesses. While the certification process requires dedication and transparency, its benefits can help social entrepreneurs flourish in today's impact-conscious business landscape.
As the world becomes more conscious of social and environmental issues, being recognized as a B Corp can give your business the edge to stand out, make a difference, and create a sustainable future. Start your B Corp journey today!