B-Corp Certification Gets a Boost
Columbus is seeing what founders David All and Christine Deye call a B-celerator, a new business line of their company CivicHacks that is dedicated to helping companies attain B-Corp Certification. The social equivalent of a LEEDs designation for a building, a B-corp certified business has undertaken an extensive review to demonstrate its focus on social benefit. The Metropreneur recently published a feature on this new business.
But first let’s avoid potential confusion. There are Certified B CorporationsTM (often called B-Corps) and there are businesses incorporated as Benefit Corporations (often called B-Corps).
The first is a certificate of performance, focus, and attitude for a conventional business, whether an LLC, C-corp, S-corp, or whatever. The second “B-Corp” is a legal form of incorporation. Both indicate a business that places social benefit high on its list of goals. And, of course, there are social enterprises, which place social impact EQUAL TO OR ABOVE financial return. Social enterprises can be Certified B Corporations, Benefit Corporations, or neither.
The certification process is owned and governed by a 501c3 called B-Lab. The B-Lab “declaration of interdependence” states in part that “a B Corporation is purpose driven and creates benefit for all stakeholders and not just shareholders.” This process costs a company money and time. David All’s and Christine Deye’s B-celerator at CivicHacks aims to help and encourage companies which are going through the certification process. Says Christine in their launch announcement, “As drivers of the ‘Next Economy’, our intention is to build businesses — in every industry — that authentically balance profit with purpose.” A former leader of Jeni’s Splendid Ice Cream’s effort to gain B-Corp certification, she notes, “the role community played in our business was a key factor in our success.” This attitude toward business is shared by the Conscious Capitalism movement, which I blogged about awhile ago.
Public Benefit Corporations are a relatively new legal structure that aims to protect the “double bottom line” of social impact and financial return from shareholders or corporate leaders who push to drop the former in order to boost the latter. As I wrote a few years back, when Delaware opened the floodgates by legalizing this corporate form, “by incorporating as a Benefit Corporation a company provides legal protection to directors and officers of the corporation to consider the interests of its workforce, community, and the environment when making business decisions, including decisions to merge, sell, or liquidate. In operational decision-making, choices that would not maximize profits but would result in strong profits and social benefits are not just permitted but encouraged. In decisions to sell or liquidate the company, directors are not limited to “take the highest offer” but can choose options that also consider the impact on employees, the local economy, and the “general public benefit.” Model legislation and answers to detailed legal questions can be found at www.benefitcorp.net.
Congratulations to CivicHacks for their commitment to encouraging and facilitating a conscious, social emphasis in business decision-making.
Yours in Linking Mission to Money,
Allen Proctor, President & CEO, Center for Social Enterprise Development