B Corps make sustainability their business

An American organisation that rewards businesses by way of sustainability certifications has set up shop in Australia, and many local companies are lining up to have their efforts recognised.

A non-profit organisation founded in the US in 2006, B Lab aims to drive companies to benefit the environment they operate in, and the people involved.

In short, it describes its efforts as a dedication to using the power of business to help solve social and environmental problems.

The organisation launched its own certification, B Corporation, to set apart those businesses that hold a fundamental dedication to sustainability.

B Lab recently launched an office in Melbourne – its first in Australia – which coincided with Maylands-based consultancy 361 Degrees Stakeholder Engagement Services being the first business in Western Australia to obtain the B Corp certification.

Principal consultant Jamie Robertson told Business News the certification embodied everything that the consultancy stood for.

“Our work has to make a difference … we’ve got some criteria around which work we actually accept,” Mr Robertson said.

“This year we probably rejected as many clients as we accepted on the basis that they don’t meet the criteria that we’re seeking.”

He said all of the consultants had previously worked in senior management positions with large organisations, where they had become frustrated with their inability to make a difference.

“We want what we do to be meaningful and to make a difference … it’s very, very hard in large organisations to really make a significant difference,” Mr Robertson said.

“I had been looking for something that reflected the fact that we’re different in a positive way, and the B Corp certification captured that perfectly.”

It took Mr Robertson an entire day to do just the first stage of the B Lab assessment – an online questionnaire.

He estimated that a large organisation would need a single person dedicated to completing the assessment for at least a couple of weeks.

Questions cover areas such as employee diversification, decision-making, environmental footprint, as well as community benefit.

The next stage in gaining accreditation involved a lengthy interview with a B Lab representative.

Businesses are then either approved for or denied B Corp certification, which stands for ‘benefit corporation’.

More than 1,000 companies across the world have received B Corp certification and are now referred to as B Corps, including Patagonia and Ben & Jerry’s, while 18,000 are understood to be undergoing the initial assessment.

In Australia, 45 have obtained the certification with 500 engaged in the process.

Businesses that qualify as B Corps differ from social enterprises in that they are established to make a profit while working to improve social and environmental issues.

In contrast, social enterprises typically emanate from a not-for-profit organisation that has launched a business segment to increase revenue. However social enterprises also have the opportunity to become a certified B Corp.

Perth social entrepreneur Brodie McCulloch recently travelled to the United States to get first-hand experience with some emerging B Corps.

He visited San Francisco-based New Avenue Homes and a school attendance-focused business called Kinvolved.

Both were set up as businesses but held a strong social mission in their core focus.

Mr McCulloch is managing director of Social Innovation in WA, the NFP that launched the St Georges Terrace co-working location Spacecubed.

Mr McCulloch told Business News he was looking into how the basis of the B Corp certification could be applied to Spacecubed to evaluate its sustainability impact.

“We’ve been looking for a framework to show how we’re impacting our members and the broader community, and B Corp would be a really good way to communicate to our members and different stakeholders as to how we’re going in a holistic way of impacting the community,” Mr McCulloch said.

The key to the B Corp certification was the emphasis on holistic impact, as Mr McCulloch said some social enterprises may not measure up, despite having significant social impact.

“It could be that what [a social enterprise] is doing is making money and having a good social outcome, but it might not have an environmental impact as well,” he said

Mr McCulloch said the concept had prompted legislative change in the US where organisations could register as a B Corp, but that was a long way off happening in Australia.

“It’s not so much that we’re behind in Australia, but it’s more that the concept isn’t broadly known about yet,” he said.

“There are a lot of businesses that have a strong social, environmental, economic and community impact but we have a lot of work to do around how we actually measure that.”