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Nonprofit Trends: The Rise of the B Corps Movement


As more and more companies make community engagement a priority and add corporate responsibility pages to their websites, and as “benefit corporations” continue to rise, the definition of the social sector is becoming increasingly broad. In the past, businesses were reactive, performing social sector engagement for reputation management. Now, there is demand among consumers, and preference among talent, for socially-engaged brands. As we illustrated in a previous piece, younger generations’ are attracted to employers who emphasize community engagement and social impact, regardless of whether that means working for a nonprofit, a for-profit, or something in-between.

“Something in-between” could be described as a B Corp. In simple terms, B Corps seek to use business for social good. Businesses pursuing B Corps Certification undertake the B Impact Assessment, which is produced and managed by B Lab, a nonprofit that advocates for and supports the B Corps movement. The Assessment evaluates businesses in five key impact areas:

  • Environment – the company’s environmental performance through its facilities; materials, resource, and energy use; and emissions. It also measures whether the company’s product or service is designed to solve an environmental issue.
  • Workers – assesses the company’s relationship to its workforce – through compensation, training, culture, communication, etc.
  • Customers – measures the company’s impact on its customers – specifically whether its products/services promote public benefit and are targeted toward serving under-served populations.
  • Community – evaluates a company’s supplier relations, diversity, and involvement in the local community, and also measures the company’s practices and policies around community service and charitable giving.
  • Governance – evaluates a company’s accountability and transparency.

B Lab also lobbies for state legislation to support B Corps, and such legislation exists in Virginia. The Virginia State Corporation Commission defines a Benefit Corporation as a Virginia stock corporation whose articles of incorporation provide that it is a benefit corporation and that has, as one of its purposes, the purpose of creating a general public benefit on society and/or the environment. Such legislation can provide protections for businesses that don’t seek to maximize profits at the expense of community impact.

According to B Lab’s online databases, there are approximately 42 Benefit Corporations, and 20 B Corps in Virginia. While similar in scope, and some businesses do hold both designations, there are some differences between the two.

What's the Difference Between Benefit Corporations and Certified B Corporations

From B Lab’s website. Click on the image to learn more.

B Corps and Nonprofits

As the B Corps movement grows in popularity, how will the sector compete for talent? How are nonprofits benefiting from B Corps? What do nonprofits have to learn from social impact businesses?

To help answer some of these questions, over the next few weeks, we will be talking to a few local B Corps to learn more about this unique sector and the impact they are making on the greater Richmond community, including Impact Makers, which is leading efforts to educate and support local social entrepreneurs interested in getting involved in the B Corps movement.

Read our Local B Corps Series

More From Our Nonprofit Trends Series

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