B Corp companies have many advantages in the business world: learn about requirements, the process, and the benefits in the B Corp community!
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There’s a movement brewing in how business is conducted and a heightened awareness of the impact beyond company shareholders, internal stakeholders, and the bottom line. More business leaders are making a conscious choice to meet the highest level of standards — they’re joining an elite group of businesses and organizations and becoming certified B corps.
Having the distinction of being a certified B Corporation means adhering to business practices that embrace sustainability and social and environmental performance. Achieving B Corp status takes commitment, as certification requirements can be rigorous, including a certification process that involves all levels of the organization, as it impacts decision-making across every department.
The certification process takes time and effort, but the advantages of being part of the B Corp community are worth it — creating a trusted brand with a public benefit to the community and a long-lasting positive impact.
Starting in 2007, the B Corp movement has grown tremendously, gaining the attention of investors like Access VC, who align with the mission and values associated with certified B Corp businesses. The list of top-notch B Corp companies is over 6,000 B Corp businesses spanning 80 countries, representing more than 150 industries.
Let’s discuss the requirements for becoming a B Corp, the process involved, and some benefits and advantages businesses gain by achieving this designation.
There are eligibility requirements to apply for B Corp status. First off, the business must be a for-profit company. Non-profit organizations are not eligible to apply to become a B corporation. Also, the company must be in business for at least 12 months.
One exception to this rule applies to early companies, such as startups, as they can seek B Corp status before having a 12-month tenure, with a pending B Corp Certification status to reflect their intentions.
Once a business has confirmed eligibility, it can begin applying for B Corp certification.
Depending on the company's size and annual revenue, there are slightly different avenues for becoming a B Corp, but the overall process and framework are the same. Entrepreneurs, startups, small businesses, and multinational and well-established brands can apply for certification. B Lab, a non-profit organization, oversees the application process and guides businesses.
B Corp certification is not a one-dimensional process, as it involves many areas of an organization and buy-in from internal stakeholders. Businesses must achieve a minimum score of 80 out of a possible 200 points to meet B Lab’s scoring standards.
The B Impact Assessment plays a large role in the certification process. This will involve many members of an organization, as it’s an in-depth assessment. Companies submit their B Impact Assessment and submit a disclosure questionnaire.
B Impact Assessments focus on five key areas: community, customers, workers, environment, and governance. This information is sent with any necessary supporting documentation for verification and review.
The company is required to create a legal framework that accounts for any stakeholders involved. This framework solidifies and states the overall impact of company decisions on respective stakeholders. This is referred to as stakeholder governance, and it serves as a means for companies to stay true to their missions.
Companies are bound to create and publish a B Impact Report as a commitment to transparency requirements. This report lives in the B Corp directory and is the last step before certification. It outlines the company’s impact and reflects how it stacks up against the performance requirements.
Companies that achieve certification must pay annual certification fees. The amount is based on the company’s gross revenue. Certifications must be updated every three years as part of an ongoing recertification process.
Once a company becomes B Corp certified, part of its B Corp agreement is maintaining the practices that got them certified in the first place. This means B Corp certified businesses must undergo a recertification process after three years.
Recertification involves documentation verifying legal requirements have been met, updating the B Impact Assessment, and adhering to the next steps, as outlined by the review committee. This recertification process can take up to a few months to review.
When there’s an alignment with the right type of investors, matched with passionate founders of startups, there’s a synergy that propels growth and momentum. B Corp companies attract investors with similar values and a mission greater than profits.
B Corp companies find great value in investors who understand and acknowledge the companies' mission with this distinction. Access VC is a venture capital firm focused on health, hygiene, and nutrition brands.
Access VC is the purpose-driven venture arm of Reckitt. It is aligned with the B Corp community, with a pending B Corp certification and a track record of partnering and investing in founders within the B Corp community.
The best brands build trust that comes through internally and externally. B Corps build a level of trust unmatched in the business world. Consumers feel good about doing business with B Corps, and this trust carries through to vendors, suppliers, and even potential brand partnerships.
The B Corp community is strong and united for change in economic, environmental, and social systems. There’s a special camaraderie among B Corp companies, and this kind of trust and community sparks business growth and enables innovation.
Becoming a B Corp provides the advantage of a growing community of businesses and a sense of trust among all stakeholders.
The process doesn't stop when a business becomes B Corp certified. Commitment to environmental impact, social performance, and the other components of a B Corp agreement are ongoing.
This creates a mindset of continuous improvement for the company that starts with leadership and spans across every department at every level. Companies that embrace this are shown to be more resilient and agile and more apt to have long-term success.
Businesses that go through the B Corp process adopt a continuous improvement mindset, setting the stage for long-term success.
Everyone knows that acquiring the right talent is key to the success of any business. Top talent can be the tipping point for a business going from good to great and can tremendously impact growth.
An advantage of becoming a B Corp is drawing on that designation as a selling point to track talented staff who believe in the company and its way of doing business.
Retaining the talent businesses work so hard to acquire is a lot easier when employees are engaged in their work and the company exhibits transparency. B Corps tend to have a much more engaged workforce for these reasons.
Studies show that an engaged workforce translates to 22 percent more profitability, and engaged employees are good for business, boosting success rates twice the amount of businesses lacking employee engagement.
Finding talent aligning with a company’s mission and values provides better chances to retain talent.
Becoming a B Corp-certified business involves up-front work, and internal buy-in from key stakeholders and impacts every area of a company. Once certified, the commitment is ongoing, leading to a culture that embraces continuous improvement and increasing chances for sustained growth and success.
Finding the right investment partners who align with the company's mission and values is critical to responsible, sustainable growth.
If you’re a founder in the health, hygiene, and nutrition space who wants to discuss your pitch or an investor searching for opportunities, contact Access VC to learn more about our business model and unique portfolio.
Why Companies Are Becoming B Corporations | Harvard Business Review
How many Certified B Corps are there around the world? | B Corporation