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You might have seen that B Corps are on the rise. The number of certified B has increased 350% in the last 10 years. In the UK there are now more than 1000+ B Corps at the time of writing.But what's driving this demand? Is B Corp something I should do for my business? In this article, we'll break down:
- What is a B Corp
- What are the advantages for my business?
- Examples of B Corps
- How does being a B Corp differ from being a normal businesses (in UK)?
- How hard is it to get certified?- What's best for my businessWith these questions in mind, let's dive in.
The B Corp certification is a third-party certification that evaluates a company's social and environmental performance, public transparency, and legal accountability to balance profit and purpose. To become B Corp certified, a company must meet a set of rigorous standards that demonstrate their commitment to social and environmental responsibility. B Corp certification is based on five impact areas: Governance, Workers, Community, Environment, and Customers. These impact areas reflect the key aspects of a company's operations and how they impact stakeholders and the world around them.Let's break down these impact areas a bit more:
1) Governance: This impact area evaluates a company's overall commitment to social and environmental responsibility, including their legal and ethical framework.
2) Workers: This impact area evaluates a company's commitment to providing a safe and fair workplace for their employees, including fair compensation and benefits, and opportunities for growth and development.
3) Community: This impact area evaluates a company's impact on the local and global community, including their charitable giving, community involvement, and overall impact on society.
4) Environment: This impact area evaluates a company's impact on the environment, including their carbon footprint, energy and water use, waste management, and overall environmental impact.
5) Customers: This impact area evaluates a company's commitment to providing safe, healthy, and sustainable products or services to their customers, and their overall impact on the customer experience.B Corporations are known for their transparency, accountability, and commitment to social and environmental responsibility. They are businesses that are driven not just by profits, but also by a desire to make a positive impact on the world. This 'balance' is what's known as the triple bottom line, focussing on people, profit and planet at once.To summarise, the B Corp assessment is essentially a certification of what your business does in sustainability and ESG (environment, social and governance). If you want to learn more about Sustainabiltiy, check out our article on what sustainability means for businesses.
If you're an SME considering B Corp certification, you might be wondering what benefits would it bring to my business? Here are a few advantages to keep in mind:
Enhanced reputation and customer loyalty:
By becoming a B Corp, you're demonstrating your commitment to social and environmental responsibility, which can enhance your reputation and attract customers who are looking for sustainable and responsible companies to do business with. This is one of the reasons that B Corps report an average revenue growth of 14% year-on-year and are shown to grow 28 times fast than average companies.
Improved employee satisfaction, attraction and retention:
B Corp certification can help attract and retain employees who are looking to work for a company that is making a positive impact on the world. Why is this important? Well the 2023 Polman report indicated that 2/3 of UK employees want to work for a company that is having a positive impact on the world, and 1/2 of UK employees say they would consider resigning if the company’s values don’t align with their own. Being a B Corp checks both those boxes. Plus, B Corps tend to have better employee benefits and opportunities for growth and development, which can improve employee satisfaction and retention.
Improved supplier relationships and access to sustainable products and services:
91% of companies take sustainability criteria into account in purchasing decisions. This is substantial when it comes to supplier contracts or client pitching and RFPs. As a B Corp, you'll be part of a network of like-minded businesses that prioritise sustainability and social responsibility. This can help you build relationships with suppliers who share your values and provide access to sustainable products and services. Appeal for shareholder investment:Investment in ESG companies has more than doubled since 2020. Improved access to financing and investment opportunities: B Corp certification can help your business stand out to investors who are looking for sustainable and socially responsible companies to invest in. In fact, some investors only consider investing in B Corps, making it a great way to access new sources of capital.
If you're still wondering whether B Corp certification is right for your business, consider these examples of successful B Corps:Patagonia: This outdoor apparel company has been a B Corp since 2012 and is widely recognised for its commitment to environmental sustainability. In addition to using sustainable materials in its products, Patagonia has also donated over $110 million to environmental organisations.Ben & Jerry's: Known for its delicious ice cream flavours and commitment to social justice, Ben & Jerry's has been a B Corp since 2012. The company sources its ingredients from fair trade and organic suppliers, and has a strong commitment to climate action.Danone: The largest B Corp in the world, Danone is a multinational food and beverage company that is committed to sustainability and social responsibility.
In addition to achieving B Corp certification in 2020, Danone has also set ambitious sustainability goals, such as becoming carbon neutral by 2050.These are just a few examples demonstrate that B Corp certification is not just for small businesses or niche industries. Companies of all sizes and sectors can benefit from becoming a B Corp and demonstrate their commitment to sustainability and social responsibility.For UK SMEs, more and more companies are certifying because it's arguably easier to implement when you have less policies and practices in place.How B Corps
B Corp certification is a unique way for businesses to demonstrate their commitment to social and environmental responsibility, and it differs from traditional corporations in several key ways.First, B Corps must meet rigorous standards for social and environmental performance, transparency, and accountability. This is different from traditional corporations, which may prioritise profits over other considerations.Second, B Corps are legally required to consider the impact of their decisions not just on shareholders, but on all stakeholders, including workers, customers, communities, and the environment. This means that B Corps are committed to balancing profit with social and environmental responsibility, rather than focusing solely on the bottom line. The notion of the 'triple bottom line' we talked about earlier.By becoming a B Corp, businesses can distinguish themselves from traditional corporations and demonstrate their commitment to making a positive impact on the world.
For a full breakdown, check out our article "How to become a B Corp: The key things you should know". But to summarise, to become a B Corp, businesses must complete a assessment (the B Impact Assessment or BIA) of their social and environmental performance and meet a minimum score (80/200 points). They must also sign the B Corp Declaration of Interdependence and incorporate their commitment to social and environmental responsibility into their legal structure. For SMEs seeking B Corp certification, there are several tips to keep in mind here:
1) First, it's important to start early and set realistic goals. The certification process can take several months or even years, depending on the size and complexity of the business.
2) Second, businesses should engage their employees and stakeholders in the certification process. Don't do this in a black box. This can help build support for the company's sustainability initiatives and ensure that everyone is aligned around the same goals.
3) Finally, businesses should seek out support (from organisations like ourselves), which can provide guidance and resources to help them achieve B Corp certification.It's important to remember that while yes B Corp certification is a challenging process – it is also a valuable opportunity for your business to demonstrate a commitment to social and environmental responsibility and make a positive impact on the world.
So what's right for my business? Well it depends on where your priorities sit right now. If sustainability is something you want to do more of as a business, then it's a great first step. But if you're still not sure, it may be worthwhile speaking to other B Corps about their experience. Ultimately it's down to you, but the one thing we do know is the more companies doing good for people and planet, the better.
If you're interested in learning more about B Corp certification, currently in the process or already certified and wanting to improve, find out how Futureproof can help by speaking to our team today. Together, we can create a more sustainable, equitable, and prosperous future for everyone.
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