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What does B Corporation mean, and how can it protect your business?

Opening a business up to shareholders comes with a lot of opportunity. Investors can accelerate the growth of a company, provide capital for expansion, and lead to a more robust operation.

But what about the costs? If you are running an Eco-friendly business and want to stay that way, it is important to remember that investors in your company are typically after profit, and their influence may compromise the company’s goals.

Even if you aren’t shooting for an IPO, becoming a B Corp means that your customers will continue to see your company as a force for good in a world where the pursuit of profit tarnishes nearly everything we touch.

How you treat your workers, the community, and the planet as a registered B Corp puts you above the bar in every category. Your customers know it, your employees know it, and the community, no matter how large that becomes as you grow, will know it.

What Does B Corporation Mean?

B Corporations are often called Benefit Corporations, but it’s important not to confuse the two. Benefit corporations are self reported, while B Corps are subject to oversight for every aspect of their business model, from how they treat their employees to their carbon emissions to their interactions with the local and global communities.

While B-Corps operate for profit like any other corporation, they also adhere to a stronger sense of environmental and global impact.

Becoming a B-Corp is a little more complex than checking a box on a tax form. Corporations are first encouraged to pass an online test for their company with a score above 80%, and from there are subject to inspections and fees associated with being “part of the club.”

B Corps vs Benefit Corps

To make the distinction clear, benefit corps are available in some places, and are responsible for governing themselves and deciding the benefit standards to which they must adhere.

B Corps, on the other hand, are subject to annual fees, testing, and external regulation and inspection. They must continue to adhere to stringent requirements in many areas that affect the community, the environment, and the lives of their employees.

In short, benefit corporations sound nice on an advertising poster, but they aren’t being held to any specific standard, and they are not certified for operation. They don’t have backup, and they won’t appear on a list of certified companies.

In short, B Corps have a pedigree, benefit corps don’t.

Status of benefit corporation legislation in the US by state


New HampshireNew JerseyNew Mexico
New YorkOklahomaOregon
PennsylvaniaRhode IslandRhode Island
VirginiaWashington, DCWest Virginia
List of the US states that legally recognize benefit corporations (passed benefit corporation legislation)

Map of the US states that allow B Corporations

(data source:

How to Become a Certified B Corp

B-Corps are available across the united states, and come with a few extra limitations for the added prestige they deliver to your company.

The initial assessment of a B-Corp includes a non-refundable $150 fee, and annual fees are $1000 or more depending on the size of the corporation.

The standards of being a listed B Corp are continually becoming a necessity among consumers, and the B Corporation movement gives those shoppers a strong criteria to judge by. The younger generation chooses where they shop based on sustainability, as demonstrated in this article.

As a B Corp, your company will be required to keep up with those demands for ethical business practices.

Take the online assessment and see how your company stacks up. Your results will show you if you need to improve some things or if you are ready for certification now. 1/3 of businesses will not pass their first go, but you will see what needs improving.

Once the B Corp assessors give you the green light, you will need to pay your dues and keep track of all of your activities. You are also subject to periodic inspections, especially in the first couple years, and you will need to be re-evaluated every so often to keep your status.

What Does Certified B Corporation Mean?

What is a certified B corporation, but a company who has done all they can to ensure that the future of their business will continue to have a positive impact on the population and the globe.

People know this, and they are starting to look for the label. From a marketing perspective, this is the future of responsible business operation. Rather than being mandated by government, B Corps set the bar for ethics, sustainability, and responsibility.

Being certified also allows you to diverge from the typical investor philosophy of profit over all else, and retain the legal right to do so. It means your company can’t be taken over by greedy Wall Street businessmen who are out to line their own pockets, while still retaining all the perks of being a publicly traded company if that is the goal.

In short, Certifying as a B Corp will allow you to continue running your business in the best interests of the community and the environment, while having easier access to investors and shareholders.


Adding your company to the growing list of B-Corps comes with a few trade-offs. It can be difficult to qualify, and comes with some recurring costs.

However, for companies ready to shoot for an IPO or already established corporations, the costs may be outweighed by the many benefits.

A boost to customer relations goes without saying. By becoming a B Corp, you are making a lasting commitment to the environment and your community.

The ultimate decision depends on how your company is currently run and what changes will need to be made to qualify.

In the end, if you are ready to ensure that your business practices are of the highest standards, and want to reap the rewards of it being seen that way, then B Corp is your stamp of approval. It will demonstrate your commitment to business ethics and sustainability to the whole world.

Further reading:

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