As a thought leader, author, educator, and consultant on humanist manufacturing, I write a weekly article that benefits leaders who want to improve their organizations using elements of my Humanist Manufacturing framework.
In two recent weeks, we explored "Doing Well While Doing Good" in To Be or Not To B Corp? and Further Benefits of Adopting the B Corp Model. The B Corp model is what I see as a merger of the best of the for-profit and non-profit sectors. One where a company still focuses on making a profit coupled with an environmental or social purpose is known as the for-benefit or fourth sector. Organizations interested in becoming Certified B Corps will utilize the B Impact Assessment to determine the capability to gain this certification status.
"Businesses can lead with their values and make money, too. You don't have to simply be purely profit-driven. You can integrate social and environmental concerns into a business, be a caring business, be a generous business and still do very well financially." – Jerry Greenfield
There is growing evidence that shifting from a singular focus on maximizing profit to a triple bottom line of people, planet, and profit leads to more robust financial performance. Business leaders like Ray Anderson of Interface, Yvon Chouinard of Patagonia, and Jerry Greenfield of Ben & Jerry's are just a few of the many leaders of companies with an established track record of the financial gains accompanying their additional focus on improving the environmental and social impact of their organizations. While others have yet to follow suit for many reasons, I surmise that one obstacle is a lack of knowledge about how to adopt this beneficial approach to doing business. The B Impact Assessment is a tool that can guide a company to becoming "a caring business, be a generous business, and still do very well financially."
Those who believe in continuous improvement will be pleased to know that a seventh version (V7) of the B Impact Assessment is in the works. My experience is that the assessment has become more rigorous with each new iteration. B Lab shares that this has been the case since V3, with the latest report of average scores for companies completing V6 being nearly three points (-2.89) lower than V5. The B Impact Assessment (BIA) measures a company's environmental and social impact. The BIA has five categories with a possible total of 200 points. The following is a brief description of the criteria for each category in V6 and a sample BIA question:
1. Community – The impact of an organization on their local engagement; cooperative models; diversity, equity, and inclusion; fair trade sourcing; local economic development; and poverty alleviation. What % of your total cost of materials in the last fiscal year came from underserved suppliers that have received the above capacity-building support?
2. Customers – The company supplies quality products and services that ethically address a particular social issue directly or through its customers to improve the social impact of other businesses or organizations. In what ways do you determine whether the organizations you serve directly support underserved populations?
3. Environment – Measurement of a company's environmental impact on the air, biodiversity, climate, land, and water. Additional points are available for organizations that provide products and services with a positive environmental impact. Which of the following environmental metrics does your company track regarding the environmental impact of your product or service?
4. Governance – The company's environmental or social impact, ethics, mission, and transparency; additionally, the ability of the organization to protect the mission and incorporate stakeholders in its decision-making. How does your company integrate social and environmental performance into decision-making?
5. Workers – The contribution to employee well-being related to career development, engagement and satisfaction, financial security, health and safety, and wellness. Furthermore, companies gain additional points to support community members with employment barriers or non-executive ownership of 40% or more. What percentage of employees on an FTE (Full Time Equivalent) basis are paid at least the equivalent of a living wage for an individual?
Organizations that score 80 or more points upon verification by B Lab can become a Certified B Corporation. However, what seems like a low score is difficult to achieve. Fortunately, B Lab provides several ways to support businesses with benchmarks, standards, and tools for companies pursuing certification.
There is growing evidence that shifting from a singular focus on maximizing profit to a triple bottom line of people, planet, and profit leads to more robust financial performance. However, one obstacle to others adopting this approach may be a lack of knowledge about how to make this practical approach to doing business. One solution is utilizing the B Impact Assessment to determine our ability to gain this certification status.
I encourage companies to benchmark themselves against others in their industry sector. One opportunity to do so is the listing of Certified B Corps. One can search by company size, Best for the World by impact areas, Best for the World by year of recognition, ownership type, and industry.
I am grateful to the current executive leadership that continues to carry on the work of the B Lab founders of Jay Gilbert Cohen, Bart Houlahan, and Andrew Kassoy. Recently appointed lead executive Eleanor Allen oversees the global leadership team that continues to grow the B Corp model around the globe.
Next week's blog will continue to expand our knowledge of the B Corp movement with the introduction of Version 7 of the B Impact Assessment, which is essential to humanist manufacturing.
To learn more about our work or read more blog posts, visit emmanuelstratgicsustainability.com.
I encourage you to read my book Humanist Manufacturing: A Humanitarian Approach to Excellence in High-Impact Plant Operations. The paperback and eBook versions are now available at Amazon and many other booksellers. You can also view the Humanist Manufacturing Book Launch to gain additional insight into the Humanist Manufacturing framework.
I invite you to join the Humanist Manufacturing Group on LinkedIn if you want to interact with others interested in the topic.
If you like what you have read, I invite you to connect with me on LinkedIn.
Contact me if you need help with the manufacturing support services of consulting, coaching, Fractional Chief Sustainability Officer, or training/reskilling at 734-664-9076.
See my virtual TEDx videos at Reinventing the Prison Industrial Complex and Humanist Manufacturing.
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