What Are The Benefits of Becoming a B Corporation?
There was a time when the world was divided. On one side of the ledger were for-profit companies and on the other non-profit organisations. Companies were typically built to maximise profits for their shareholders and no one else. Their focus was on a single “bottom line”, namely profits. On the other side were non-profits. They were organised to create social good. Their activities included things like offering a soup kitchen to the homeless or mental health support for the vulnerable. Their focus was also a single bottom line, namely having a positive impact on their community.
Neither were perfect. Both have issues. Some companies today have taken the profit motive to the nth degree leaving us with examples of unimaginably bad corporate behaviour. The recent Royal Commission into the Financial Services industry is a case in point. Revelations of insurers selling policies to the deceased signalled that there were very real downsides to the “profit at all costs” approach. Similarly for non-profits, while their hearts are in the right place, demand constant fundraising to keep the operation afloat and many seriously struggle to maintain relevance and stand the test of time. A downturn in the economy can see donations dry up. A change in Government policy can spell the end of a relied-upon grant.
Today, however, the world is changing. These two diametrically opposed organisational archetypes are increasingly taking on the characteristics of each other. The catalyst is a new breed of entrepreneur, the “Social Entrepreneur”. These brave souls have identified wicked problems in the world that need solving. Rather than use a non-profit approach, they are using business as a force for good. They see that they can create a business that makes meaning and money.
What are B Corporations?
The establishment of certified “B Corporations” in the US in 2007 offered a formal structure for Social Entrepreneurs to build their money and meaning-making machines. Becoming a certified B Corporation demands that a company “meets the highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose”. Entrepreneurs need to consider the impact of their decisions on their workers, customers, community, and environment. It is unique in that it is the only certification for a company as a whole as opposed to say gaining “organic” certification that applies just at the product level.
Today there are more than 2,700 certified B Corporations in 60 countries. A further 10,000 companies have completed the impact assessment to become a B Corporation. Well known companies such as Patagonia and Kickstarter are B Corporations. The largest B Corporation is USD$6 billion Danone Whitewave in the US who makes yoghurt.
Australia boasts 500 B Corporations from listed superannuation provider Australian Ethical to brewers including Stone & Wood and Four Pines, Koala mattresses and Ben & Jerry’s.
Consumers are responding positively to the B Corporation movement. A recent Deloitte Millennial survey revealed that nearly 40% of respondents declared that the aim of business should be to “improve society”. 66% of respondents in a recent Nielsen study of global consumers showed that they are willing to pay more to support companies making a social and environmental impact. The B Corporation logo on consumer-facing products gives consumers the confidence that these brands are doing good in the world.
What are the benefits?
Becoming a B Corporation offers the following tangible and very valuable benefits:
- Build credibility & amplify voice with all stakeholders.
- Build relationships
- Lead a movement
- Attract talent & engage employees
- Improve impact
- Protect mission
Doing the free “B Impact Assessment” is the best way to understand where your company currently stands in relation to your treatment of workers, customers, community, and the environment. Even if you have no intention of becoming a certified B Corporation, it is an excellent tool to measure your current state. If you do choose to become certified, the team at B Corporation offer all the assistance you need to complete the certification. If your current score falls short, they offer practical tools to improve so you can meet the standard and become a B Corporation.
The B Corporation certification is the perfect way to measure the good your company is doing in the world while it simultaneously makes money. We no longer need to live in a divided world.
If you’re looking to build a sustainable business with impact, iAccelerate puts you way ahead of the pack. Applications close May 27 for the next intake – don’t miss your chance to have a real and sustained impact on the world. APPLY TODAY!
Jason Graham-Nye is passionate about disruptive innovation, company culture and impact capital. He is the Social Entrepreneur in Residence at iAccelerate and the founder & CEO of gDiapers, a US and EU-based environmentally friendly baby nappy company grounded in Cradle to Cradle design principles. Jason has no commercial affiliation with B Corporation however gDiapers is a Certified B Corporation.