An Inside Look At B Lab’s Plan To Change Business
Tuesday, July 12, 2011
Entrepreneurs, consumers, governments, and businesses are increasingly using market forces to solve social and environmental problems. B Lab, a five-year-old nonprofit, is attempting to turn that potential into a new kind of corporation that recognizes true corporate social responsibility. The organization works by providing a framework that companies must take in order to be certified as a “B Corporation.” And these aren’t just cosmetic steps like increased recycling; companies must write socially responsible policies into their charters and bylaws to qualify.
We had a chance to talk to two of B Lab’s founders at this week’s ACT II: Aspen Global Leadership Summit about how the cofounder of AND 1 (a basketball apparel and footwear business) and a private equity investor ended up trying to change the business world. The organization has, essentially, launched what cofounder Jay Coen Gilbert calls “LEED for business.” Certified B Corporations (the B is for benefit or “be the change you wish to see in the world,” depending on your preference) have to meet rigorous legal accountability, environmental, and social performance standards. It’s a way for companies to demonstrate to consumers, investors, and anyone else who may be interested that they are doing well by doing good.
As consumer interest in corporate social responsibility has grown (and the financial crisis has started to change the business community’s priorities), so has interest in B Corp–there are now over 370 Certified B Corporations, up from 125 in 2008. Five U.S. states recognize B Corporations as a distinct legal entity (like S Corporations and C Corporations), and more are set to sign legislation in the near future, according to Gilbert.
B Lab originally grew out of an Aspen Institute fellowship project. The Institute, an organization that encourages values-based leadership, asks all of its fellows to complete a leadership project. B Lab founders Jay Coen Gilbert and Andrew Kassoy are both fellows at the Institute–and the nonprofit was Gilbert’s big project.