Benefit corporations, like B Corps, are for-profit companies that meet rigorous standards of social and environmental performance, accountability and transparency. Essentially, benefit corporations desire to use the energy of markets to resolve social and environmental problems. Whenever we were inspired to include as an advantage corporation, here were our five reasons.
B Lab, which is the non-profit group that holds benefit corporations and B Corps accountable, shared our belief that businesses should exist to do more than just make money. Both of us believed that businesses should be utilized as a force for social good. At Practice Makes Perfect, one in our four core values is conscious capitalism, which is focused on the triple-bottom line. We know business principles could be used appropriately as a very powerful tool to handle social inequities.
Every entrepreneur knows that creating a business is hard work. It’s even harder work when you’re doing it alone. Today, there are over 2,000 B Corps round the world. B Lab aggregates learnings, shares case studies, provides professional development and creates opportunities for CEOs to convene and take part in meaningful conversations.
3. Public accountability
The B Lab team spent years tweaking and determining what counts. The standards that benefit corporation and B Corps need to stick to will be the gold standard for how businesses should operate. Being a company that worked directly with our public education system, we wished to hold ourselves to the highest available standard of public accountability. B Lab’s incorporation and recognition process keeps companies honest.
4. Capability to put money second to what matters
This is one in our top reasons. We didn’t enter the business of eliminating the summer learning loss and dealing with low-income children because we wished to make money — otherwise we would’ve incorporated as a for-profit from day one. In situations in which a company could turn a greater profit due to its fiduciary obligation with their investors, we can put mission first as an advantage corporation. This truly allows us to think about what is in the best interest of our children and our school partners.
5. Attracting the right people
Being truly a benefit corporation or a B Corp gives you the opportunity to make an extremely public declaration that you value more than profit. That is a sign to your investors, your visitors as well as your employees (both current and future) that you are more than just your numbers. You’re focused on something bigger. This signal could keep people away who don’t sign up to these views on business. Being a benefit corporation or a B Corp is a public declaration that you’re registered to a movement that uses business to do good.
Being truly a benefit corporation or a B Corp isn’t a walk in the park. The assessments take time and they need a sincere commitment to doing right by all of your people — employees, customers and shareholders.