What are Certified B Corporations?
Certified B Corporations are companies that take into consideration social and environmental factors when making business decisions. They pay attention to the triple bottom line: people, planet, and profit. To formalize this committment, they undergo a third-party audit of their operations to ensure that they:
- Meet comprehensive and transparent social and environmental performance standards.
- Meet higher legal accountability standards.
- Consider community stakeholders.
What are Benefit Corporations?
Benefit Corporations and Benefit LLCs are related to B Corps and represent a new legal classification of private companies. This designation allows companies to put sustainability into the DNA of their corporate charters with the state.
Traditionally, corporations must act in the best interest of their shareholders. Any decision that a corporation makes must take the financial interests of its shareholders into account. This can often prevent company executives from considering non-financial interests. A company that decides to become a Benefit Corporation or Benefit LLC voluntarily agrees to meet higher standards of corporate purpose, adding societal and environmental interests into its state charter, thus considering all stakeholders and the public good in their decisions if they want to.
So how are Benefit Corporations and B Corps Related?
When a company registers as a Benefit Corporation or Benefit LLC, it is required to provide a third party verified annual report to the state detailing its activities in relation to its stated sustainability commitment. Becoming a certified B Corp and publishing the B Corp Scorecard satisfies this requirement.
Further, becoming a Benefit Corporation or Benefit LLC requires a change to the corporate charter (the document that establishes the company). However, becoming a certified B Corp requires a change to the bylaws or operating agreement. That’s the legal document that governs how a company operates and make decisions.
Learn more about the history of B Corps and Benefit Corporations here. There’s ice cream involved!
Why Did Clean Currents Become a Certified B Corporation and a Benefit LLC?
Clean Currents was one of the first companies in the state of Maryland to complete the B Corp assessment and adopt the B Corp legal framework into its operating structure and was the first company in the state of Maryland an the United States to file to become a Benefit LLC.
We have always seen ourselves as a for-profit company with a non-profit mission and believe that businesses are responsible for being a driver of positive change in society. Becoming a Certified B Corp and Benefit LLC allows us to show take our genuine commitment to social and environmental values. By taking this step, we have placed our values into our operating agreement and corporate charter and make our sustainability scorecard open to the public.
To view Clean Currents B Corp Scorecard, click HERE
We love our fellow B Corps! Check out this blog post about the most recent B Corp Summit.