What is a B Corp (and Why Should Shoppers Care?) – Saveur
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SOURCE: Megan Zhang | Saveur
Rummage through your pantry right now and you might notice some products have a letter B, surrounded by a circle, nestled discreetly on the packaging—perhaps next to a “certified gluten free” label, or the address of the company’s headquarters. This logo represents a third-party certification from B Lab, an international non-profit that evaluates for-profit businesses’ impact on their employees, the environment, and society. Before granting its certification, B Lab takes a holistic view of a company’s environmental performance and community engagement, scrutinizing their commitments to areas like civic involvement, employee satisfaction, climate impact, and diversity and equity.
Founded by former Stanford University classmates Jay Coen Gilbert, Bart Houlahan, and Andrew Kassoy to help businesses be “a force for good,” B Lab has been certifying companies as B Corporations (often shortened to B Corps) since 2007. But today more food and drink companies and restaurants than ever are undergoing the rigorous assessment process to validate their commitment to the public good. This year, whisky corporation Maker’s Mark, supplement company Vital Proteins, and plant-based egg alternative brand OGGS are just a few that have joined B Corps’ ranks.
As Americans’ confidence in major institutions continues to wane, businesses recognize that customers increasingly expect brands to take action on societal issues such as global warming, racial inequity, and healthcare policy. “Savvy consumers want to know the businesses and brands they patronize make a positive difference,” says Jamie Horst, chief purpose officer of tea company Traditional Medicinals, a B Corp since 2010. Consumers are looking to support purpose-driven brands demonstrating values aligned with their own—and will take their business elsewhere if there is a mismatch.
In an age when many companies are green-washing to boost their bottom lines, independent auditing by a third party like B Lab may be considered a more trustworthy measure of a company’s impact—and many corporations are eager to exhibit that they are genuine advocates for social and environmental causes. Chef Pierre Thiam, who owns the New York City restaurant Teranga and food brand Yolélé, points out that certifications can “help consumers make informed decisions more easily and reduce decision fatigue for overburdened household shoppers.”
So what do shoppers need to know about B Corps? Here are some key things.
B Lab assesses companies based on multiple areas of performance.
Though the exact route to certification varies depending on a company’s size (startups, for example, have different guidelines than large enterprises), the first step toward becoming a B Corporation is completing the self-guided B Impact Assessment. This measures the company in key impact areas—including governance, customer experience, employee satisfaction, and environmental sustainability—and helps teams track and improve their performance. All companies must score at least 80 points in the assessmentin orderto submit their application for B Lab’s review.
Companies must also meet legal and transparency requirements.
In addition to demonstrating performance, S-Corporations and C-Corporations must also change their corporate structure to become benefit corporations (if the status exists in the state in which they’re incorporated), while limited liability companies (LLCs) must add B Lab-approved purpose and directors clauses to their operating agreement. These changes grant company leaders the legal flexibility to balance profit goals with social and environmental missions, and to consider not just shareholders but all stakeholders in business decisions. (Benefit corporations and B Corps are sometimes mistakenly used interchangeably; they aren’t the same thing.) Certified corporations must also make their assessment score, as well as details about their performance, transparent in a public profile on B Lab’s website.
The certification process is lengthy.
After a company submits the self-assessment, B Lab reviews it and begins the verification procedure, which requires the applicant company to provide documentation to back up all of its claims. “It was laborious. It was very involved and thorough,” says Ben & Jerry’s head of public relations Sean Greenwood, adding that the rigor of the undertaking speaks to the authority of the label. “You don’t want this to just be a walk in the park.” Rob Samuels, the chief operating officer of Maker’s Mark, echoes the intensity of the proceedings. Getting certified “took us almost a year,” he says, noting that the process required a cross-functional team to dedicate most of their time to assessing the company’s performance.
Hundreds of food and drink brands are certified.
According to B Lab, 6,180 brands in dozens of industries around the world are currently certified B Corporations (including famously progressive companies like Patagonia). Out of the global line-up, more than 700are food and drink brands or restaurants.
King Arthur Baking, One Village Coffee, and Numi Organic Tea were among the first food and drink corporations certified by B Lab in 2007. This year, Mijenta Tequila became the first B Corp tequila brand, while Maker’s Mark became the largest distillery to achieve the certification.
Corporations must be recertified every three years.
The B Impact Assessment continues to evolve, so companies must periodically undergo a recertification process in order to maintain their status. “Typically on two-year intervals, our standards are getting more and more rigorous,” says Max Hayes, growth manager at B Lab U.S. and Canada. B Lab Global’s independent Standards Advisory Councilanalyzes market trends and gathers insight from industry experts, then uses that information to develop the next version of the assessment. By fostering ongoing improvement, B Lab wants B Corps to view their status as “a long-term play, an ongoing commitment to sustainability,” adds Hayes.
For dairy company Clover Sonoma, which is currently going through its second recertification, the process is revealing opportunities for improvement, like additional initiatives “to lessen our environmental footprint through on-farm reductions in methane emissions and overall company water use,” says CEO Ken Gott.
Big changes are coming in 2024.
The seventh version of the B Impact Assessment, to be released in 2024, will mark a major shift in the way B Lab evaluates businesses. According to Hayes, “all B Corps will need to meet 10 base requirements,” including paying a living wage and protecting human rights. “Right now it’s really hard to compare B Corps because everybody can meet that 80-point bar differently. The new standards will really try to level the playing field,” he explains. It’s not yet clear if and how the point system will change in this upcoming iteration.
Larger companies have more resources to pursue certification.
It’s understandably easier for larger, more established brands to allocate energy toward goals like a B Corp certification. Ji Hye Kim, who owns a restaurant and hospitality group in Ann Arbor, Michigan, points out that she knows “so many small businesses who take social and environmental responsibility very seriously and practice it every day in their community” but may not have the staff or money to pursue a certification. “Small businesses are particularly time- and resource-constrained,” observes Irene Liu, co-founder of meal delivery company Chiyo. Though her team isn’t writing off seeking certification in the future, it won’t be a priority until the company has the means to pursue it.
Smaller companies may find support in regional programs like the University of New Hampshire’s B Impact Clinic. This initiative trains undergraduate students to “help smaller companies make it over the hurdle to getting certified,” says Britt Lundgren, senior director of sustainability and agriculture for the New Hampshire-based organic dairy brand Stonyfield. B Lab also launched its Level program to subsidize certification fees for BIPOC women-led entrepreneurs and connect them to resources like consulting firms.
Most Americans don’t know what a B Corporation is.
According to a brand survey B Corp research firm Fors Marsh conducted for B Lab in 2022, only about a third of adults in the U.S. and Canada are aware of B Corp branding.
However, not everyone who spots the identifying insignia realizes what goes into attaining that one little letter. Much like the USDA’s organic certification, the B Corp label also encompasses multiple criteria. Raising public awareness of the logo and what it stands for is a task that largely falls on the certified firms themselves. Carey Underwood, King Arthur Baking’s director of mission partnerships and programs, says more B Corps should display the seal “so that it becomes something more consumers recognize and can use to inform their purchase choices.” To that end, Underwood adds, the Vermont-based brand works with other B Corps in the state, including Ben & Jerry’s and Cabot Creamery, to “share messaging and help spread the word together.”
B Lab has faced some backlash.
When Nespresso, the coffee company owned by Swiss food megacorp Nestlé, became a B Corp this year, many certified companies sent a joint open letter to B Lab in protest. The group pointed out that alleged human rights violations (to which Nestlé later responded) at farms linked to Nespresso undermined the certification’s reputation. In response, B Lab maintained that Nespresso had met the requirements for a multinational corporation of its size.
Though B Lab preserved Nespresso’s status, the non-profit can revoke previously bestowed certifications—and has done so in the past. Beer company BrewDogrecently lost its B Corp labelafter employees alleged toxic workplace culture in an open letter, The Guardian reports.
Ultimately, there’s more to a company than a certification—or lack thereof.
It’s nearly impossible for any one certification to be the universal authority encompassing all of the world’s millions of corporations. “There are so many variables that play into whether a business is a ‘good’ one or not,” notes chef Laurence Louie, who owns the Boston-area restaurant Rubato. As a purchaser, he also does his own research to ascertain a potential supplier’s general reputation.
In addition to learning about a brand’s standing, Thiam “looks at ingredient lists and sourcing practices, which can often be more informative,” he says, though he recognizes this may not be realistic for time-strapped shoppers.
Importantly, the lack of B Corp status doesn’t mean a company isn’t prioritizing environmental responsibility and social welfare. “Many retailers ask about B-Corp or Fair Trade certification to back up our claims about our work and impact. It can be a hard pill to swallow to be doing the work we’re doing and not get the ‘badge’ for it,” adds Thiam.
Still, as awareness of B Corporations grows, it’s likely more grocery stores will use the certification to appraise brands or market products—and shoppers can expect to see the B logo on more of their food and drink going forward.
This article was originally published on Saveur. You can view the original article here.
