Becoming a certified B Corp. is the way to get an “A” grade with prospective business partners in today’s sustainability-minded economy, according to a growing number of companies in Los Angeles and nationwide.
B Corporations are for-profit companies that meet a superlative list of social and environmental standards as defined by B Lab, a nonprofit founded in 2007 and headquartered in Wayne, Pa. The organization conducts B Corp. certifications as part of its mission to create a global community dedicated to using business for good.
“It’s a differentiator,” said Manny Barragan, client and treasury representative of the Southern California region for Beneficial State Bank, a certified B Corp. since 2012. “A lot of companies are now on a sustainable program, and they want to align their values with a lot of other like-minded companies,” he said.
According to B Lab, there are 2,788 certified B Corporations across 150 industries in 64 countries. Of those, 1,188 are located in the United States, and about 60 are in Los Angeles County.
Like a number of other cities, Los Angeles founded its own local chapter, B Local Los Angeles, in 2015. In September, representatives of about 600 B Corps. will gather in Los Angeles at an annual retreat.
B Lab conducts its “B Impact Assessment” (BIA) with companies seeking the certification. The written test asks for detailed information about matters such as company governance, worker treatment and compensation, stakeholder representation, transparency, and environmental sustainability programs. In order to receive certification, a company must score 80 or higher out of 200 possible points.
Taking the test is free, but certification fees begin at $500 and scale upward based on company revenue.
B Lab said another 55,000 companies use its impact assessment to help define their own sustainability goals without necessarily seeking certification. The detailed and extensive test can be onerous, particularly for larger companies.
In Los Angeles, local companies said B Corp.’s “green” requirements are a go-to standard to look for. Barrett Porter, a financial adviser and partner with Abacus Wealth Partners in Santa Monica, a founding B Corp. member, said the certification is important both to clients and potential employees.
“I’ve been pleasantly surprised with the number of incoming financial advisers who will talk to us and tell us one of the differentiators for them was when they went to our website and saw what our values are,” Porter said.
Sustainability consultant Andrea Chase, founder and sole proprietor of Way to B Corp. in Venice as well as chairwoman of B Local Los Angeles, said B Corp. certification is a badge of honor.
“I am actually seeing a huge interest in investors investing only in B Corps.,” she said. Chase noted that major corporations including Unilever and Danone Foods Inc. have recently acquired B Corp. status.
Jordan Allen, an executive vice president with Participant Media-owned SoulPancake in Beverly Hills, said the entertainment company’s B Corp. certification is in keeping with its mission to produce positive and inspiring content.
“I would say most importantly, our B Corp. status legitimizes us in the space,” Allen said. “We practice what we preach.”
