What is a B Corp and what is the process for becoming one?
Organic, fair trade, sustainable, socially responsible…these monikers carry value with many consumers. The first two are regulated, so someone else (the US Department of Agriculture and Fair Trade USA, respectively) does the homework for us. The latter two—sustainable and socially responsible—are slippery and subjective. Pennsylvania-based nonprofit B Lab brings objectivity to assessing businesses that are “good for the world” with their B Corporation designation (the “B” in B Lab and B Corporation stands for benefit). So how, exactly does one learn how to become a B Corp and begin that process?
In The B Corp Handbook, author Ryan Honeyman says, “B Corps matter because they are concrete and measurable. B Corp certification turns the ambiguous concepts of ‘going green’ or ‘being a good corporate citizen’ into something tangible…that people can easily identify, trust, and support.” I like to think of them as the organics of the business world; B Corps are as much about what you leave out (like pollution) as what you put in (like workplace diversity).
The process is arduous. Applicants answer over 100 questions, with varying levels of complexity and minutiae, in four categories: Governance, Workers, Community, and Environment. Many topics require documentation. Count on at least submitting your most recent tax return, employee handbook (if you have employees), and third-party certifications, if you use vendors or suppliers who are also responsible or sustainable. The scoring system starts at zero and adds points for everything you’re doing right. You’ll need 80 points, out of a possible 200, to get certified. (No one gets 200. Patagonia, the darling of the outdoor industry, earned 152.)
The next step is to secure appropriate legal designation. If your state is one of the 34 that offers “benefit corporation” status, you’ll need it. This is an addendum on your current legal structure and doesn’t affect your taxes – it is essentially a pledge to be responsible. I live in Montana, where the Secretary of State’s process is just receipt of a one-page form.
Lastly, you’ll sign a contract and the Declaration of Interdependence – the pledge you make to other businesses and other people to do the best you can for yourselves and for them. You’ll pay your annual fee to B Lab, and they’ll let you know what to expect next, like writing your profile for their website, the expectation of recertifying in two years (it’ll be easier), and the possibility of an audit (20%).
So…where to start?
How to Become a B Corp (or at least, how to get started)
- Read the B Lab website to understand more about B Corps, and what certification will and won’t mean for your company. It might not be a great fit.
- Decide if you have capacity right now, in terms of time, energy, and financial outlay.
- Take the quick assessment. It will give you a ballpark figure – just know that this will likely drop when you get into more detail.
- Once you complete the quick assessment, someone from the B Lab team will guide you through the rest of the process.
B Corp certification is hard, and it is all in service of a meaningful designation that will catch the eye of a wide swath of your stakeholders. Ben & Jerry’s, Method, and most of the other companies you think of as responsible are already on board. As more companies are certified, you – and every other consumer – will start seeing that circled B in more places and the B Corp movement will gain more attention, creating greater value for you.
Let’s continue this conversation in the comments. Does this article answer your questions on how to become a B Corp? How far into the process are you. Do you have any tips for others or questions you’re dying to get answered? Let’s help each other be better business owners!
 Ryan Honeyman, The B Corp Handbook: How to Use Business as a Force for Good. (San Francisco: Berrett-Koehler Publishers, 2014), 14.
This article was written by Kate Wiggins. Kate is a Human Resources Manager and Coach at XY Planning Network, the leading organization for fee-only financial advisors who want to serve their Gen X and Gen Y peers. Kate hires rockstars for the team, coaches financial advisors in launching and running their firms, and engages XYPN with its hometown community of Bozeman, Montana.