Since its inception in 2006, the B Corp certification has become one of the most recognized indicators of sustainable business practices around the world.
It has been compared to the Fair Trade or USDA Organic certification applied to some food products, a strong commodity that distinguishes products directly from non-organic competitors.
A 2019 survey found that 47% of consumers would pay at least 25% for sustainable products and services. According to a 2018 Yale University report, accredited B Corps have a higher growth rate than comparable public companies. This trend continued even during the Great Recession.
What is a B Corporation?
A Certified B Corporation, or B Corp, is a for-profit business that meets “the highest standards of social and environmental performance, public transparency, and legal obligations to support profits and goals.” .”
This definition is published by B Lab, a non-profit organization that evaluates the social and environmental impact of other companies against sustainability and transparency standards, and supports companies with B Corp status.
B Corps certified companies should not cause harm, their products, services and business practices should benefit all stakeholders. Lab B describes stakeholders such as employees, communities, customers and the environment.
According to B Lab, when starting a business, the five B Corps requirements that must be met are:
- Work. Directors must consider the impact of the transaction on all stakeholders.
- understanding. Companies must publish and make available to the public reports on their social and environmental activities.
- Performance. Companies must have a minimum impact assessment score of B and apply for accreditation every three years.
- Availability. Any corporation can become a B Corp, regardless of city or state of incorporation.
- Together. Companies pay a certification fee to B Lab, the amount of which is based on their revenue.
The B Corps divides the trained B Corps into four divisions:
- Multinational and public companies
- Companies have things to do with it
- Internationally approved B Body
B Corp voluntarily enter the B Lab’s assessment program. As part of this assessment, they go through a rigorous B Corporation certification process, detailed below.
B Corps vs. benefit corporations
“B Corp” is often confused with the abbreviation of “profit corporation”. Although Charities share some similarities and missions with B Corps, they differ in several important ways, that is, Charities have no association with B Lab.
What is a for-profit company?
A for-profit corporation is a traditional corporation, such as a legal C corp, that changes its practices to engage in higher standards of performance, transparency, and transparency. Charities strive to create social value and add lasting value in addition to making a profit.
Similarities and differences
In their commitment to supporting organizations that act globally and locally, the B Corps benefit organizations are one.
The directors of B Corps and the welfare society should consider the company’s impact on all stakeholders and publish a report on its social and environmental performance, comparing it to other standards. However, they differ in terms of certification, availability and cost.
- Availability: Corporate benefits are available only in the 30 US states and DC. Oregon and Maryland offer a Benefit LLC option. B Corp certification is available to all businesses, regardless of location.
- Accountability, transparency and performance: B Corp is certified by B Lab auditors (and must be able to get it back). The state agency enforces eligibility criteria for for-profit companies, but the agency is responsible for self-reporting of performance. Government regulators will not monitor the ongoing performance of for-profit companies.
- Accreditation: The B Corp rating is an independent, not-for-profit certification body that provides objective, third-party performance evaluations. Companies that achieve B Corp status can use the B Corporation logo from B Lab on their merchandise. For-profit companies are recognized by the government, but the government’s role ends once the company’s eligibility is determined.
- Cost: Value companies require between $70 and $200 in application fees; Laboratory B certification fees range from $500 to $50,000, depending on the company’s revenue.
If you want to get B Corp certification, your first step is to determine if your company meets or is close to meeting B Lab standards. Do you already have a community-supporting practice?
If so, you may want to consider using the B Corp Impact Assessment, which is free. Even if you choose not to pursue certification, considering your company’s sustainability practices in this way can be useful if your goal is to make your company more environmentally and socially responsible in its actions. .
How to get a B Corp
A company’s journey to becoming a certified B Corp will vary based on many factors, including sector, industry, status and ownership structure.
B Lab estimates that this process takes six to eight months for small and medium businesses. In general, these steps are:
Sign up for an impact assessment B. There is no cost associated with this step.
- Complete before work
Find out the legal requirements for B Corp certification for your business. B Lab provides an interactive tool to determine legal requirements on its website, based on location, type of business, business conditions, and other factors.
If you are applying as a multinational company, complete the risk assessment provided by B Lab, a screening process that thoroughly examines the multinational company’s history, operations, objectives and public image to determine B Corp eligibility.
Collect supporting documents and data for impact analysis B.
Complete the Online Impact Assessment B for initial scores. (Note: Completion of Impact Assessment B does not produce a completed application.)
Some example questions may relate to a company’s financial information distribution system, how its compensation system compares to the market, how its supplier management works, or whether it uses energy efficiency programs. Answers are usually multiple choice, sometimes ordered on a scale (ie, often, most of the time, most of the time, rarely, never, etc.).
Build a company profile, which you’ll be asked to complete after you’ve done most of the assessment, and then start the disclosure questions. At this point, your score will be revealed. If it is below 80 points, it will be necessary to analyze your business and improve in some areas before restarting the analysis.
If you pass the 80 mark, submit a grade B of your impression for review. At this time, you will pay an entry fee of $150.
- Check out
Lab B determines your eligibility by having an examiner review your profile and company status. You may be asked follow-up questions about your employees and suppliers. Enter the evaluation call with the evaluator, during which you will review the evaluation report prepared by the evaluator and provide your previously assembled documents supporting your response to the evaluation.
If the examiner proves that you are over 80, you will have to enter a declaration of consent and sign the B Corp agreement. After you sign the agreement, you will be issued a certificate as a B Corp. You will pay an annual certification fee, depending on the size of your business and your income.
Do you want to be a certified B corporation? Apply today
It’s clear that joining a B corp can benefit your bottom line. Brands like Patagonia and Ben & Jerry’s have applied their certifications to promote social media, create more shareholder value and positively impact the world.