B Corps are for-profit companies certified by the nonprofit organization known as B Lab to meet standards of using business for the greater good.
B Lab has developed a model corporate business structure and certification process called B Corps, which allows businesses to legally incorporate social and environmental goals in their purpose and work, in addition to the objective of profit and financial rewards for shareholders. Any for-profit corporation may apply to be certified as a B Corp through the application process administered by B Lab.
“A majority of the states have passed legislation that allows for-profit corporations to adopt a benefit corporation model legal structure. This model is intended to encourage corporate boards and shareholders to recognize and prioritize corporate values other than financial, such as healthy working conditions, social consciousness, environmental connectedness and sustainability,” says Nelson Irvine, attorney with Chambliss, Bahner & Stophel. “Both new and existing businesses can become ‘benefit corporations’ in states that have passed benefit corporation legislation.”
“As often occurs with new ideas, the term ‘benefit corporation’ means different things to different people and varies state to state. Benefit corporations may or may not be certified as B Corps. The B Lab certification process for B Corps represents an effort to provide some generally accepted standards on a national and international basis. In Tennessee the benefit corporation model is authorized by the Tennessee For-Profit Benefit Corporation Act.”
More than 1,700 companies, from 50 countries in 130 industries, are B Corp certified – including Etsy, Warby Parker, Ben and Jerry’s and Patagonia. Two Tennessee companies are B Corp certified: Good.Must.Grow in Spring Hill and Mountain Challenge in Maryville.
Businesses begin the process of becoming certified by completing an online assessment of the overall impact of the company. More on the certification process and B Corps here.
