Follow by Email

Friday, March 16, 2012

New Corporation Structure for New Generation of Entrepreneurs - "B" Corporation

Good evening Friends and Colleagues,

I am by no means an expert in this topic. I have been completely fascinated by it and have been following it since the moment I heard about it. If I were to start a company today, one of my short term goals for that company would be to become a certified B Corporation.

I first heard about the Benefit "B" Corporation last year at a fundraiser for the International Green Industry Hall of Fame: http://www.gogreenhall.org/ .

Donald Simon, who was the featured speaker at the fundraiser, told us about some of the problems corporations where having with the sustainability movement. In short, the public over the past few years has been looking to corporations to "do the right thing" and to put people and the community before profits.  Businesses have been getting hammered through social networks for the destruction of communities and the environment.

The root of the problem is that a C or S Corporation's main objective is simply to create a profit, while a company's products and services could be benefiting society.

So, what happens when groups of people buy up stock and gain majority ownership of a corporation in order to control or steer a business in a new direction? Chaos?

This is where the B Corporation comes into focus.

The B Corporation builds on the idea of the Triple Bottom Line. The Triple Bottom Line is a theory that Profits, People and Society can work together, and all can win. These three ideas are not in competition with one another; they must work together for society to function properly.

In order to become a certified Benefit Corporation, you must follow a set of guidelines. B Lab is the third party that certifies companies as Benefit Corporations. Here is a link to the B Corporation website: http://www.bcorporation.net/.

The information there is fascinating. You will see that there are over 500 B Corporations in the United States generating almost 3 Billion in revenue. So far in 2012, seven states have adopted the B Corporation structure. Those states include: California, New York, Hawaii, Maryland, New Jersey, Vermont and Virginia. A few more states are pending.

Here is a great article that was published in the New York Times: http://boss.blogs.nytimes.com/2012/03/14/for-b-corps-a-new-corporate-structure-and-a-triple-bottom-line/

Even better article by Forbes:
http://www.forbes.com/sites/csr/2012/02/24/dealing-with-trust-why-the-b-corp-legislation-offers-business-a-chance-to-be-good-again/

I hope this information is useful.

DB





No comments:

Post a Comment