March 2021 is B Corp month where the global community of over 4,000 registered B Corporations celebrates what it means to be a ‘better business’.
Nick Misquitta, Senior BDM Manager at Bates Wells, the UK’s first B Corp law firm, writes for The Professionals introducing B Corps, how professional services firms can #buildbackbetter, and what that means for Bates Wells.
What’s all this about B Corps then?
That’s a question we’ve heard since 2015 when Bates Wells first certified as a B Corp, particularly from clients and new joiners where it’s proved to be a real conversation starter.
So what is a B Corp?
B Corporations (B Corps for short) are profit-making businesses. They can’t be charities or public sector organisations. But where they’re different to traditional businesses is that they don’t just exist for shareholder profit. They exist to advance a ‘triple bottom line’ purpose of people, planet and profit.
Is it CSR?
No. CSR has been around for 50 years and is mainly about minimising the negative impacts that a business has on the world. B Corps aim to maximise the positive impact that they have through everything they do. The positive impact must be meaningful and implemented through a business and its operations. It can’t be run through one set of activities, like a CSR programme.
How do businesses become B Corps?
To certify a business must complete an impact assessment that scores its operations across five key areas of governance, workers, community, environment and customers. To pass the assessment, which is then independently audited, a business must score at least 80 points (professional services firms average 93.3 points). It must also update its articles of association to include a mission commitment. There are also annual fees and a recertification process every three years. It sounds simple but it’s a very rigorous process.
Have I heard of any of these businesses?
Definitely. Household name brands like The Body Shop, The Guardian, Cook Food, Ella’s Kitchen, Brew Dog and Innocent are all certified.
How does Bates Wells view this market?
We see this as the direction of travel for business. And we see ourselves as having a genuine competitive advantage over other firms in this space.
We know that not all businesses can or will want to become B Corps. But over 70,000 companies across the world have used the B Impact Assessment to measure and manage their impact so far – with over 4,000 certifying to date.
In terms of the advice that B Corps need, there is the initial corporate advice on enhanced directors’ duties and updating articles of association – something we have advised several B Corps on. Other than that, B Corps will have legal needs similar to any business – corporate, employment, contracting, financing, disputes, real estate, and so on. But their approach to a legal issue may be very different from that of a traditional business.
B Corp month
For B Corp Month we are running a campaign to demonstrate our niche expertise in advising B Corps. And we’re trying to demystify the certification process for businesses that might currently be on the fence. Keep an eye open for my colleague Stan Verkaik’s review of Bates Wells’ activity in The Professionals in April.
There are over 400 B Corps in the UK, across almost 50 industries and who employ over 22,000 people. But general awareness is patchy and I feel there is still so much more to come from the B Corp movement. With ESG now on the agenda all big businesses (and their advisers) and a post-pandemic recovery that needs us to #BuildBackBetter there is a huge opportunity for businesses that reject the traditional model of short-term gains and opt for long-term sustainability.
Please get in touch via LinkedIn if you would like to learn more about B Corps or if your firm is looking for guidance on the process.