Behind the Journey of Continuous Improvement of B Corps
Being a B Corp is more than obtaining a certification — it’s about having a framework for continuous improvement. The assessment analyzes a company’s operations across the entire business and ensures there are accountability and transparency measures in place to demonstrate the company’s commitment to staying on mission and constantly working hard to be better.
How is the B Corp Certification used as a framework for continuous improvement in practice?
The movement of improvement is what the B Corp movement is often referred to — as achieving B Corp Certification is just the first step of the journey. Companies who obtain B Corp certification not only want to be the best in the world but the best for the world. They continuously strive to improve their positive impact on all stakeholders and measure the effects of their actions on social and environmental performance. In this article, we’ll take a closer look at how B Corp Certification offers a framework for B Corps to work on improving their positive impact on an ongoing basis.
Companies who want to obtain B Corp certification need to score a minimum of 80 points on the B Impact Assessment (BIA). This holistic framework assesses a company’s positive impact across five key areas: governance, workers, community, environment and customers. Reaching the 80-point bar is an impressive feat in itself, but of course, that is not where the journey ends. The goal is to use the learnings from this ‘first pass’ and then set out to find means to further improve one’s positive impact.
Let’s zoom in on this B Impact Assessment, as there are many ways in which it encourages continuous improvement. Once a company has completed the questions in the BIA, the B Impact Score shows how well a company scores across the five key areas. It does not do this in isolation, however, as there are benchmarks available for companies of similar sizes, in the same country, or those in the same industry. It also provides various reports which identify key areas for improvement. As going about improving one’s impact might be challenging, the BIA also provides various explanations and resources to help the user take action for improvement. The user is encouraged to set goals and track these over time. There are over 150,000 users who use this impact management tool around the world.
“B Corp Certification is not designed to be easy or quick. The median score on the B Impact Assessment is 55, while B Corp Certification requires 80.”
Dan Osusky, Head of Standards & Insights at B Lab Global.
The 80 point bar that companies try to achieve (and then exceed) is based on an intricate set of social and environmental standards. These standards represent what good business looks like — but there is still plenty of room for improvement beyond the minimum threshold of 80 points. While B Corp Certification is difficult, and requires verified and concrete performance on the standards, it doesn’t mean that a company is ‘perfect.’ Companies are not expected to have every possible best practice, or even be free from mistakes.
Another important component of what it means to be a Certified B Corporation is reducing negative impacts or managing material-sensitive issues. Though not expressed in a score, managing social and environmental risks is a key part of what it means to use business as a force for good. In the B Impact Assessment, this is taken into consideration through the Disclosure Questionnaire and a background check. B Lab’s Standards Development team has also conducted a lot of work to understand the intricacies and risks of controversial industries — those that may represent a risk for negative impacts on their stakeholders. As a result of this work, controversial industry statements have been developed to push these industries to do better and transform the culture, behavior, and impact of these industries.
How do companies improve their impact with recertification?
Being a B Corp is not a one-time recognition, it’s an ongoing commitment towards improvement. If you’re a company looking to improve your social and environmental performance, then how do you know if you are on the right track? One of the key moments for a Certified B Corporation is the recertification, where every three years a company is required to verify its most recent performance and obtain a new B Impact Score. Some of the companies that have shown significant improvement upon recertification are African Clean Energy and Alpro. What drives them to do better?
The B Corp African Clean Energy (ACE) focuses on enabling decentralized access to clean energy for rural households in Sub-Saharan Africa and Southeast Asia through inclusive financing models. In 2018, the company got certified with 148.9 points, and recertified in 2021 with a whopping 179.8 points, making them the highest-scoring B Corp in Europe.
During our European Summit, Judith Joan Walker shared their experience going through the certification process and talked about how they continuously work on improving the positive impact of the company.
What are the key lessons learned? What did they really improve from the first round of certification to the second?
1. Be honest and only make decisions that are aligned with your values. You don’t have to be a charity, you can have commercial success and do good. ACE was able to improve on every element of the BIA because of the control they have over their value chain by selling direct to customers in markets where needed and manufacturing, distributing and prefinancing their products. However, how do you make sure that every decision is aligned with your values?
“Do things the way that you’re proud of doing it, so if anyone asks you would proudly defend the absolute truth of what you are doing and why you’re doing it. I guess that’s how you become the highest-scoring B Corp in Europe.”
Judith Joan Walker, Chief Operating Officer at African Clean Energy
2. Formalizations are not bureaucracy if they help you do business in the very best way. Going through the BIA in the first place, ACE realized the importance of having the evidence and the documentation to demonstrate that you integrate certain principles into your operations and are able to track progress.
3. You don’t know what you don’t measure. Between the first and the second round of certification, ACE became not only more data-driven but was also able to segment data according to certain variables, such as gender, that are key to improving social impact measurement and monitoring alignment with your business code of ethics.
Alpro has been a B Corp since 2018, and originally certified with a score of 87 points. As a Belgium-based company with global operations, it can be challenging to increase dramatically given the size and complexity of their operations. However, just three years later they recertified with a score of 106.3 — almost 20 points above their original score!
Several factors contributed to that increase, many of them outlined in the goals and tangible actions featured in the Feeding our Future with Plants report with clear heath and planet targets. Alpro is working on reducing its emissions and water usage as well as closing the loop on packaging. And they’re not stopping there — they have clear commitments in place to continue to improve their footprint, invest in supplier engagement, monitor direct health impacts and a clear sustainable packaging roadmap (read more about their journey here).
“We are beyond thrilled to have achieved such an improvement in our already impressive B Corp score. As a B Corp business, what really sets us apart is the fact that, in our strategic decisions, we consider the health and sustainability of all our stakeholders — employees, shareholders, the community and the environment.”
Sue Garfitt, General Manager at Alpro
Both African Clean Energy and Alpro have been recognized for their work as Best for the World companies in 2021 in Community and Environment, respectively. See all Best for the World 2021 nominees here.
Ok, I’m inspired — but show me more numbers!
The nature of the B Corp Certification as a framework for continuous improvement is reflected in our latest data on recertification in Europe. B Corps increased their score on average by 4.14 points (5.2%) during their most recent recertification. The B Corp that improved the most between certifications (a 3-year cycle), increasing their score by 43.9 points, is Les Pres Rient Bio, the French Organic dairy subsidiary of Danone.
When analyzing the changes in the BIA score and its parts over a certification period, we learned that the BIA score increases on average by 3.82 % (SD=0.1550) per certification period (3 years). Which would on a yearly basis represent an average of 1.29% (SD = 0.0701). This number was computed as compound yearly growth. Looking from a different perspective, the companies on average improve by 1.05 points per year (SD = 6.4645) which is around 0.53% of all possible points. One point may not seem like a lot, but it just goes to show how difficult it is to obtain the minimum of 80 required to certify!
Beyond improving their operations, companies are also finding ways to meaningfully transform their business models. Looking into Impact Business Model (IBM) points and the changes that happen between the certifications among the 52 IBM topics (not all available for all companies), we noticed that when pursuing recertification, 55.1% of B Corps in Europe introduced at least one new IBM that they didn’t have in their previous certification.
How does B Lab embark on the same journey of continuous improvement?
The world is facing many pressing social and environmental challenges, and as we learn about the complexities and intricacies of these challenges, we also have a better understanding of what is needed to address them. This dynamic and fast-evolving reality is also reflected in the standards for the B Impact Assessment.
Since being introduced in 2007, the B Impact Assessment has been updated several times to improve the clarity, consistency, and insight of the assessment and its scoring, stay up to date with best practices and innovations in impact measurement, reflect the role business should play in addressing our world’s social and environmental challenges, and accommodate ongoing user and stakeholder feedback. Its current version, Version 6, was launched in January 2019.
B Lab is also in the process of reviewing the overall performance requirements for B Corp Certification, which you can find out more about here.
What are the lessons you have learned during your certification and recertification journey? Which suggestions would you give to companies looking to become a B Corp?
The data referenced in this article was collected between 2013–2021 using the B Impact Assessment (BIA), a tool developed by B Lab. The sample consists of companies that are certified in Europe and have completed at least one recertification cycle (in order to measure changes in scores and Impact Business Models (IBMs). All data were analyzed by the B Lab Europe team.