B Corp companies: What are they and how do you become one?
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Posted: Fri 27th Oct 2023
If your company has a greater purpose, and wants to demonstrate its credentials not just on the environment but also with suppliers, workers, customers and clients, B Corp certification is for you.
It's the gold standard for better business, and companies that certify are truly following the model of people, planet and profit. Companies that choose to become B Corps commit to measuring their social and environmental impact alongside their financial performance.
Their commitment is reflected in the rigorous certification process that the company must go through to become a B Corp. So what is a B Corp? What are the benefits of being certified? And why might your business choose to apply for certification?
What is a B Corp?
A B Corp (or B Corporation) is a profit-making company that seeks to benefit society and the environment through the business it does.
To become certified as a B Corp, a business must go through an extensive assessment process to demonstrate its commitment to standards of social and environmental performance, transparency and accountability.
The goal of becoming a B Corp is to create long-term value for everyone who has a stake in the business – and not just a financial one. Companies that become B Corps are driven by the belief that their success should benefit everyone – employees, customers, suppliers, the environment and the wider community.
By holding themselves accountable to higher standards than traditional corporations and businesses do, they can make sure they're having a positive impact on a number of fronts throughout their operations.
Once certified, the company must maintain its standards every two years to keep its status.
By becoming B Corps, companies are showing the world a different business model – one that has an eye towards sustainability and responsibility. They're part of a new era of corporate social responsibility where success means more than just financial gain – it means leaving behind something better for future generations.
Is B Corp a good thing? Why should a company be a B Corp?
Being a B Corp is more than just a label – it's an opportunity to create lasting positive impact. The certification process encourages businesses to think beyond their bottom line by evaluating their social and environmental performance, as well as their commitment to transparency and accountability.
Companies that become certified show they're serious about being responsible businesses, and are rewarded with access to a network of like-minded businesses, resources and support. Plus, they gain credibility in the eyes of customers and investors who recognise the value of being part of the B Corp movement.
Ultimately, becoming a B Corp is about more than just gaining recognition – it's about committing to upholding certain values and making conscious decisions that benefit society and the planet as well as profits.
Companies that join this movement are paving the way for a new era of corporate responsibility and sustainability – one where businesses not only strive for financial success but also think beyond themselves to create meaningful change in their communities.
What is B Corp certification?
Any company that wants to become a B Corp has to meet certain standards. The path to certification involves completing the B Impact Assessment (BIA) and going through a strict certification process.
This process looks at how the company works with its employees, customers, suppliers, communities and the environment. The company must provide evidence of how it operates ethically, contributes to the local community, and strives to make as little impact on the environment as possible.
The results of the assessment are then used to generate a score that reflects how well the company is performing in those areas.
Once certified, the company must continue meeting the standards every two years in order to retain its B Corp status.
VIDEO: B Corp status and how it can boost your business
Watch this webinar to find out the step-by-step process of becoming a B Corp, including the challenges and rewards:
How do you become a B Corp?
Becoming a B Corp isn't just about ticking off boxes on an assessment. It's about making a commitment to doing good work and making positive social and environmental change.
Step 1: Take the B Impact Assessment
The first step towards becoming a B Corp is to complete the B Impact Assessment (BIA). This evaluates your company's impact on everyone who has a stake in the business, including your employees and customers, your supply chain and the wider community.
The BIA is a free online assessment that analyses how your company interacts with its workers, customers, community and the environment. It is used by over 50,000 businesses and requires you to achieve a minimum score of 80 out of 200 to qualify.
Step 2: Submit your assessment for review
Once you've completed the assessment, you can submit it to B Lab for review. B Lab is the non-profit organisation that's become known for certifying B Corporations.
Depending on several factors such as the sector or industry you operate in, your impact score and your ownership structure, it could take anywhere from six to eight months to get your their certification approved.
Step 3: Join the B Corp community
Once you're approved and certified as a B Corp, you can become part of the community of businesses and corporations that are committed to making sustainability an integral part of their operations and creating positive social and environmental change.
Who can become a B Corp?
You can become a B Corp as long as you're a profit-making business that's been operating for at least 12 months. So that excludes organisations like charities, that aren't set up to generate profit.
Company size has no bearing on certification, although smaller businesses or start-ups that want to demonstrate their commitment to doing good can also apply for Pending B Corp status (see below). This requires 12 months' worth of data, so you'll need to wait until you've been operating for a year before you apply.
When it comes to business structure, unfortunately sole traders and partnerships aren't eligible. Your business must be a limited company.
What's a Pending B Corp?
Pending B Corp status is designed for businesses that have been operating for less than 12 months, but still want to show that they're committed to doing good.
To gain Pending B Corp status, you need data from the last 12 months of business operations. This is a great way to get your foot in the door before applying for official B Corp certification.
By becoming a Pending B Corp, you'll be taking the first step towards becoming officially certified. It's an opportunity to get started on meeting the legal requirements and getting familiar with the B Impact Assessment. As a result, you'll be well equipped when it comes time for full certification.
Plus, being a Pending B Corp shows that you're serious about being a sustainable business and making a real difference in the world.
What does it cost to become a B Corp?
If you're submitting an assessment for official B Corp status, you'll need to pay a submission fee of £250 (plus VAT). Once you're certified, you pay a yearly certification fee, which is worked out based on your total revenue in your last set of audited accounts. You can see a table of prices on the B Lab website.
Applying for Pending B Corp status is slightly different. In that case, there's a one-off fee of £500 (plus VAT). This covers you for the 12 months while you prepare your impact assessment.
Is a B Corp the same as a benefit corporation?
Not quite. B Corps and benefit corporations are often confused, as they have similar missions. But there are key differences between the two that you should know.
A B Corp is a company that has met the rigorous standards for certification and submitted an assessment of its business to B Lab, the organisation responsible for certifying B Corporations.
Benefit corporations, on the other hand, have no association with B Lab. Unlike B Corps, these entities don't need to meet any standardised requirements or submit to third-party certification.
They simply commit to creating public benefit through their business operations and products or services.
What is a B Impact Assessment?
A B Impact Assessment is a comprehensive evaluation of a business's social and environmental impact.
It helps companies track their performance in areas such as labour standards, environmental practices, and community involvement, allowing them to identify where they need to improve in order to become certified as a B Corporation.
The assessment also serves as an important tool for not-for-profit businesses and investors who are interested in supporting businesses that prioritise sustainability and corporate responsibility.
With the B Impact Assessment, organisations have the opportunity to make meaningful changes within their operations while helping create positive change around the world.
The B Impact Assessment is a free tool you can use to carry out an impact audit, regardless of whether you're seeking to become certified or not.
Not only is it an effective way to measure and monitor your company's impact, but it's also educational. You'll learn things about your social and environmental impact that you might never have considered a problem.
What do you need to do to remain a certified B Corporation?
Staying B Corp-certified can be an ongoing challenge, but it's worth the effort. Not only is it a great way to demonstrate your company's commitment to social and environmental stewardship, but it also opens up new opportunities for partnerships and funding.
To remain certified, you'll need to regularly monitor your performance in the 10 areas that define leadership on social, governance and environmental business impacts. You'll also need to recertify every three years as the B Corp standards are always evolving.
This can mean making changes to your operations, making continuous improvements or investing in new initiatives that further your sustainability goals. Even if you don't become certified right away, taking steps towards becoming a B Corp is worthwhile. Reaching out to other responsible companies that are already certified is a great way to start.
How long does B Corp certification take?
Becoming a B Corp can be fairly time-consuming. It involves gathering the necessary documentation and then submitting an application, which could take anywhere from a few hours for smaller companies to a few weeks for larger ones.
Everything you submit needs to be verified, so you must have the right documents to prove that you have certain business practices in place.
Once you've sent off your application, it can take up to seven months for approval depending on wait times. However, it's worth noting that this certification isn't just a one-time thing; staying true to your B Corp status involves regularly monitoring how your company is doing in terms of its environmental and social mission and recertifying every three years as standards change.
All in all, becoming a B Corp-certified business may require some dedication and effort but will open many doors for your company.
How does B Corp address social sustainability?
Our current economic system is built on a history of injustice, inequity, violence and oppression. But businesses do have options to build more inclusive workplaces.
Becoming a B Corp is one way to embed policies and procedures that help to ensure a fair and equitable workplace for everyone. The B Impact Assessment focuses on workers, customers and community.
It can also map the UN Sustainable Development Goals to include those that particularly focus on Reduced Inequalities (goal 10), Gender Equality (goal 5) and Good Health and Well Being (goal 3).
How many B Corps are there?
As of March 2023, there are over 6,000 certified B Corps in more than 150 industries across 80 countries around the world. That's an amazing number of mission-driven businesses that have prioritised their social impact and environmental performance and redefined what business success really means.
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