By Bharat Venkatesh
For-profit companies are by definition profit-oriented, concerned with furthering their own interests rather than providing any public good. They aim solely to increase their revenues and line the pockets of their owners or shareholders. If any good does arise from a for-profit company, it is generally a result of external pressures such as the cost of carbon credits or an unintended positive externality.
Or so one might think.
The nonprofit B Lab is revolutionizing the for-profit model. B Lab is starting a movement to increase social and environmental responsibility of companies, providing a certification that shows that a corporation has qualities such as social and environmental performance, legal accountability and public transparency. The B Corp certification is based on standardized tests by an unaffiliated third party to certify companies meet rigorous standards and differentiates them from those who have a self-proclaimed “green” status but no backing.
As our world changes and advances, with more people becoming socially and environmentally conscious by the day, organizations wish to portray a concerned outlook to society even if they are primarily motivated by profit. In this way, B Corps lead a global movement to change business into a force for good with more companies joining in at a constantly accelerating pace. Rather than competing solely to be “the best in the world,” these companies aim to be “the best for the world” as well, truly making them “benefit corporations.”
B Lab conducts a B Impact Assessment upon a company’s request. B Lab not only rates each criterion but also gives a comparison with the average score for that category. As a result, the companies that fail to become B Corps have a landmark and can work toward achieving it in the future. Indeed, some companies like Sputnik Moment failed the report initially but managed to pass it a few years later. Companies that pass the report can also gain from it, being able to see and understand their strengths and weaknesses.
Arizona has a growing number of B Corps, such as the aforementioned Sputnik Moment. Some of them are based on these principles entirely, such as Green Ideas that implements sustainable building design and maintenance, UKonserve that produces reusable food storage, and Technicians for Sustainability that aims to make high-quality solar energy available to Southern Arizona. These organizations truly exemplify B Corps, as they are visibly “instruments of social change.”
However, the companies that request an Impact Assessment do not necessarily have to be conducting activities related to preserving the environment or helping others. Rather, just having these aspects as a positive externality, such as by purchasing a green building powered by solar energy or giving their employees a good level of benefits, allows them to be classified under the B Corp label if they have done enough to “impact” others in a positive manner.
Internal management can also provide benefits that allow companies to receive the certification: Goodmans Interior Structures, for example, has won the Phoenix Business Journal’s Best Place to Work six times and was the first company in Arizona to receive the CEO Cancer Gold Standard certification. Manzimvula Ventures, Inc. works to address sustainability and corporate responsibility in their clients. Sechler CPA PC is a completely virtual accounting firm with a low footprint that serves beneficial nonprofit organizations. As can be seen from these examples, the direct and indirect ways a company can benefit society are limitless.
Many companies are moving away from the stigma of the “evil corporation” and proving their business is a force for good by earning a B Corp certification.
At the time of this writing, there are over 1,000 certified B Corps in the world and 10 in Arizona. For more information, visit bcorporation.net.
Read more about corporate social responsibility at greenlivingaz.com/csr.