We are in an age of profound global challenges. Income inequality is at record levels around the world and the climate crisis is reaching a point of no return — not to mention the midst of a global pandemic and economic recession. Debates about who is responsible and how to solve these challenges are ongoing, and as a result, progress feels stalled. Increasingly, many feel that businesses have a strong role to play in turning the tide. From the recent Business Roundtable statement on the purpose of the corporation that encourages business to be more stakeholder-driven to Larry Fink, CEO of global investment giant BlackRock, encouraging investors to factor environmental, social and governance practices into their decisions.
In fact, purpose-driven business is on the rise around the world. Consumers reward companies that align with their values — according to Forrester Research in 2018, seven in 10 millennials and 52% of all online U.S. adults “consider company values when making a purchase.” Additionally, employees are gravitating toward businesses where they feel they can make a difference. In 2018, the Harvard Business Review found that nine out of 10 people would be willing to earn less in order to work a purposeful job.
As the economy has floundered and the world braces for a sustained economic recession — effects of the coronavirus outbreak — some business analysts believe there hasn’t been a better time for companies to pull the lever and make a meaningful switch to a purpose-driven approach or to engage more meaningfully and strategically in impact improvement and stakeholder governance.
My forthcoming book, Better Business: How the B Corp Movement Is Transforming Capitalism takes a look at the growth of business as a force for good, specifically focusing on the Certified B Corporation movement and why B Corps are a compelling model for the future of sustainable capitalism. In a new report that details the Benefits of the B Impact Assessment, I break down some key findings from the more than 60 interviews I completed with B Corp leaders for my book about the B Impact Assessment (BIA) and B Corp certification. Below is an excerpt of the report.
The Benefits of Using the B Impact Assessment
1. A Way to Understand Your Company
The standardized components within the BIA and the interactive assessment process with B Lab provide a holistic and systemic model for sustainable business. The BIA helps companies identify sustainable and purposeful practices they have neglected, which they may not realize until the assessment process. A company’s BIA score can be a barometer, which shows where a company is doing well and how well it is doing across the five BIA areas.
2. A Platform to Compare and Learn
The BIA online platform not only allows participants to compare their impact with their peers or companies in other sectors, but also provides them a place to learn about best practices. It offers customized solutions for companies to improve their impact. In addition, this comprehensive assessment tool helps align the company’s social mission with every constituency of its business — its employees, customers, and suppliers.
Further Benefits When a Company Becomes a Certified B Corp
Companies that choose to use the BIA to pursue B Corp certification see even more unique benefits. On top of the previously mentioned benefits, companies that achieve B Corp certification can expect the following advantages.
3. Transparency and Clarity
The B Corp certification process provides verification of corporate actions in accordance with corporate claims. The BIA score released by B Lab not only provides assurance that a company’s efforts are valid but also offers clear guidance to improve for each B Corp. The requirement of disclosure provides a visual into all these efforts and convinces stakeholders of the purposeful efforts of the company.
4. Customer Resonance and Product Differentiation
Millennials are willing to pay extra for products that account for the social and environmental issues across the world. However, they are also wary of “greenwashing,” or making the company seem more environmentally friendly than it actually is. B Corp certification helps consumers filter out potential greenwashers through the BIA’s rigorous assessment processes and high standards. The blend of for-profit and mission-driven design differentiates a B Corp from both conventional for-profit companies and nonprofit organizations and helps attract clients who share the company’s values. The universal B logo for companies that achieve certification builds a virtual brand for this innovative corporate form across industries.
5. Attracting the Best Talent and Driving Impacts Internally
B Corp certification provides a signal to potential job seekers that a company is committed to its social mission and its employees. When a new employee enters a B Corp and is immediately encouraged to participate in the company’s mission and uphold the company’s values, that person becomes invested in the company’s continued success. This helps to cultivate a positive workplace environment and reduce employee turnover.
For some of the insights from B Corp leaders and additional information about each of these benefits, you can access the Benefits of the B Impact Assessment report free.
This post was originally published on BtheChange.com. B the Change gathers and shares the voices from within the movement of people using business as a force for good and the community of Certified B Corporations. The opinions expressed do not necessarily reflect those of the nonprofit B Lab.