There’s a type of corporation in town (actually in many towns) and it’s very exciting: it is called a Certified Benefit Corporation or a BCorp. Certified B Corporations are leading a global movement to redefine success in business. By voluntarily meeting higher standards of transparency, accountability, and performance, Certified B Corps are distinguishing themselves by offering a positive vision of a better way to do business. BCorps have a corporate purpose to create a material positive impact on society and the environment. Their values: “People, Planet & Profits,” guide the way they make every business decision.
Certified B corporations are for-profit companies that pledge to achieve social goals as well as business ones. Their social and environmental performance must be regularly certified by a nonprofit called B Lab, much the way LEED buildings have to be certified by the US Green Building Council. Many B corps are also committed to a specific social mission.
There are now more than 1000 BCorps in the US, including Patagonia, Etsy, and Seventh Generation. And in the past four years twenty-seven states have passed laws allowing companies to incorporate themselves as BCorps. The commitments that these companies are making aren’t just rhetorical. Whereas a regular business can abandon altruistic policies when times get tough, a benefit corporation can’t. Shareholders can sue its directors for not carrying out the company’s social mission, just as they can sue directors of traditional companies for violating their fiscal duty and maximize profits. Benefit corporations are “required to consider” the impact of their decisions not only on shareholders but also on workers, community, and the environment.
The desire to balance profit and purpose is arguably a return to the model that many American companies once followed. Henry Ford declared that, instead of boosting dividends, he’d rather use the money to build better cars and pay better wages.
It is Saarman Construction’s intention to become a BCorp. We currently have a business that makes profit, but we also have a business that does good in the world; valuing our people and the planet has always been part of what we do. We feel that in becoming a BCorp we will procure the formal evaluation and recognition of our currently held mission and values. We will happily relinquish our C Corp status to align ourselves with this new corporate structure, the BCorp, that sings our song of “People, Planet & Profits”.
The upsurge of B corps is a reminder that the idea that corporations should be only lean, mean, profit-maximizing machines isn’t dictated by the inherent nature of capitalism, let alone by human nature. As individuals, we try to make our work not just profitable but also meaningful. It may be time for more companies to do the same.