Why brands seek B Corp status


The question of what is the purpose of a for-profit business may seem simple. It’s … for profit. But brands are starting to recognize that achieving those profits doesn’t just depend on producing products and services, as people increasingly consider a company’s impact on things like the environment and its workers before making a purchase.

Lucky for them, businesses that don’t entirely present themselves as soulless, profit-hungry types can try and prove their virtues through the burgeoning B Corp movement. Created by the non-profit organization B Lab in 2006, “B Corp” is a status that a company can apply for to certify that in addition to generating profits, it prioritizes a positive impact on the world at through things like environmental action, community engagement, and work practices.

To date, B Lab claims to have certified more than 4,000 companies in more than 70 countries. They include brands like Patagonia, Allbirds, Amy’s Kitchen, and Ben & Jerry’s.

In a briefing this week on B Corps for Congressional staff, Andrew Kassoy, co-founder of B Lab, said that the idea behind B Corps is rooted in stakeholder capitalism, or the idea that the obligations of companies should extend beyond their shareholders to include stakeholders such as their workers and the environment.

TCHO, an organic and fair trade chocolate marketing company, obtained its B Corp status in September. He says his efforts to responsibly source cocoa beans and labor were at the heart of his app. For example, the company has set up “Flavor Labs” around the world as part of its TCHO Source program to enable farmers to make and taste chocolate from the beans they produce, which many farmers don’t actually do.

“We have always been proud of the steps we have taken to maintain sustainability efforts through our TCHO Source program, and the B Corps standards were aligned with what we have already done, said Laura Sweitzer, Source Program Director. at TCHO, at Marketing Brasser.

The movement is not without criticism. For example, journalist and political expert Anand Giridharadas warned that while B Corp status will certainly attract companies that are actively trying to make a positive social impact, giant companies are unlikely to attempt to meet qualifying standards. .

“It’s a good thing, but it’s fundamentally voluntary. This means that if you are already a good, virtuous company, you might be motivated to join this club. But if you’re Exxon or Pepsi, you won’t be in this club, ”Giridharadas said in an interview with Big Think.

Check all the boxes

Onlookers might view the B Corp movement as a marketing ploy, a way for companies to put up a fancy sticker to show the world that they care more than just profit. But B Lab and the companies it certifies claim that it is not an easy label to obtain or maintain.

“The process was extremely time consuming. It took a long time to compile all the necessary documentation that they needed, ”Sweitzer told us. “The biggest challenge we faced was to compile TCHO’s 10-year procurement and sustainability records to meet B Labs application standards. “

Having said that, B Corp companies often use their status to display their values ​​to customers. Sweitzer said that TCHO displays the B Corp logo prominently on its packaging and marketing materials. Many companies that have achieved the distinction also display the logo on their websites.

To become a certified B Corp, companies must achieve a score of at least 80 out of 200 on the B Impact Assessment, an online tool that assesses a company’s impact on its employees, customers, community, and society. environment.

The assessment asks about the amount of on-site renewable energy used by a company’s offices, or the number of full-time workers who are reimbursed for continuing education opportunities, in addition to several others.

“If you only see it as a label, you’re not actually going to hit that 80 bar. It requires legitimate dedication to the mission and real positive performance,” Holly Ensign-Barstow, director of Brewery, told Marketing Brewer. governance and stakeholder policy at B Lab.

B Lab also imposes legal requirements to become a B Corp. Requirements vary by jurisdiction, but typically involve structural changes such as amending a company’s articles of association (the legal documents that establish a company and its structure) to include a positive impact on the environment or society as part of the framework. of its mission. A business could also become a benefits corporation, which is a separate legal designation issued by some state governments.

Ensign-Barstow argues that these requirements force companies to view B Corp status not just as a label, but rather as a set of obligations. According to Ensign-Barstow, this ultimately means that a company gives its directors a fiduciary duty to consider the impact on stakeholders like the environment and workers, in addition to shareholders, and it is a way discourage companies from applying for B Corp status as a means of “green laundering”.

“They need to adopt a legal status that makes them legally responsible. … So it’s not a light thing that we ask them to do, ”she said.


Companies must renew their certification every three years by taking the assessment again. They also pay annual fees ranging from $ 1,000 to $ 50,000, depending on their annual sales. Companies making more than $ 1 billion a year may have to pay more, depending on their size and complexity.

B Lab reports that it can take six to 10 months to process a company’s request, which involves validating the responses to Impact Assessment B and verifying legal requirements. About a third of candidates actually obtain certification, according to the organization’s website.

Ensign-Barstow said it is common for companies to start the assessment process and realize that they will not meet the rating, while still using the tool to identify areas for improvement.

Bombas, a company that sells socks and other clothing, said its model of donating one item for each item purchased was at the heart of its B Corp request, which was approved in 2017. Walker Stole, senior manager of Bombas Sustainability and Corporate Responsibility, we said, the application process was “enlightening” because the company had to take an in-depth look at everything from its operations to product development to community engagement.

“As a relatively young company, we have used the assessment as a tool to help us identify key areas for development and improvement, and define how we want to run the business,” said Stole.

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