Few people understand what it means by becoming a B Corp even before they can find out if it's good for them or not. In fact, many confuse it with Benefit Corporation but there is a difference.
Well, B Corporation or simply written as B Corp is a somewhat new certification and a means by which entrepreneurs identify their outlets as something more than a for-profit institution. Social entrepreneurs seek to use their businesses to engage in good actions and provide solutions to environmental and social problems.
The B Corp status is ideally a third-party certification process that recognizes a company's commitment to particular practices that are sustainable.
B Corp against Benefit Corporation
These two terms are quite different although they are used synonymously. In a nutshell, a B Corp is a seal of approval or certification by a third party acting as a certification body. On the other hand, Benefit Corporation is a particular legal business structure in a state.
In much more general terms, a B Corp is a certification that is given to B Lab Company to sustainable for-profit companies that adhere to stringent standards of environmental and social performance, transparency, and accountability. An assessment is usually performed by B Lab Company on the practices and policies of the company to know its environmental and social responsibility.
Understanding the benefit society
A benefit corporation is a specific legal business entity that exists in some states. It is an entity comparable to a corporation (Inc.), a limited partnership (limited partnership) or a limited liability company (LLC) in the state of formation . The reasons for becoming a benefit company are very different from a conventional society with respect to transparency, accountability and purpose.
Various states have a different corporate form that justifies Benefit Corporation. Notable examples include New York, California, Oregon and the more recent ones like Washington DC and Virginia among several others. Benefit companies do not need to be specifically certified by B Lab or any other organization. It is there that the difference begins.
The goal of B Corps that emerge from different parts of the world is to work together towards achieving a unifying goal – redefining stability and success in business. To become a B Corp, certification must come from B Lap Company after an assessment done on your business in general. The score of evaluation must reach a certain predetermined value on the rating system. More importantly, you must be prepared to make legal changes as set out in the articles of incorporation and issue a certain annual license fee to B Lab.
Norms are usually established by B Lab Company for B Corps and assess whether a business venture is in compliance with the goals set for B Corps. Take note that B Lab needs some legal requirements in order to become a B company. With the change of status; other changes may include incorporation documents, board resolutions, by-laws and shareholder provisions.
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Benefits of Being a Body B
There are a number of reasons why companies want to obtain B Corp certification and here are the main ones:
- B Corp certification helps companies grow, evolve with integrity, achieve higher ratings, and gain greater influence. These are standards of compliance for all B Corps that must be adhered to, hence the reason why they are good for serious investors.
- This is a way of differentiating yourself as unique in the minds of consumers, especially those who know what B Corp. stands for. Consumers may lean more toward Body B than those who are not certified.
- With a B Corp stamp, the mission of a company is protected. The basic principles of B Corps are the durability in your company's DNA by developing and marking external capital, or by planning succession, ensuring that the mission can survive under any new direction, new property and investors.
- Generate buzz while media and the press focus on Body B continues to rise. This has a significant impact on the growth of Body B in general.
This is the difference between B Corps and Benefit Corporation. According to B Lab Company, B Corps such as Giving Assistant represent a much better way of doing business. B Corporation's certification is based on the premise of what marketers are advocating today: to ensure that consumers are satisfied with the company and its way of doing business and not with business. products alone.