As of July 1, 2011, a Virginia law came into effect that made it one of the first states in the country to officially recognize benefit corporations (or B corps).
What is the difference between a benefit corporation
and a regular company? Corporations are legally obliged to focus on maximizing profit for their shareholders, but not so for B corporations: they are responsible for the triple-bottom-line of "people, planet and profit," making them a hybrid of sorts between a non-profit and for-profit organization. The non-profit B-Lab
created the concept of B corporations in 2006 and has been certifying and auditing its members ever since.
There are currently ten benefit corporations in Virginia, including one started by a friend of mine who graduated from UVA in 2009. His B corp, Chaka MarketBridge
, seeks to connect artisans in developing nations with customers in developed nations. This benefits women and their families especially: they gain an additional source of income to help lift them out of poverty while providing high-quality goods to those who want them through the their online marketplace.
The main advantage that the B corp certification brings is trust in an age of greenwashing and slick advertising. Many Corporate Social Responsibility (CSR) skeptics, from academics
to the average consumer point to a large number of companies whose CSR comes as a public attempt to counteract "negative CSR" or socially irresponsible operations. This often leads to accusations of "greenwashing" as well as suspicion. A B corp is required to be very transparent with its report cards that measure the impact of operations of factors such as social, environmental and employee well-being.
While the B corp label is young and not as widely known as other eco-labels, like LEED, it is capturing a growing demand from more and more responsible companies and self-sustaining non-profits.