B Corps: Answers to Frequently Asked Questions

B Corps: Answers to Frequently Asked Questions

As a B Corp consultant, I often get asked questions about the B Corps, B Corp requirements, fees, timelines, and more. This article is provided as a resource to help you with any questions you might have about B Corps. It’s fairly comprehensive, but if I missed something, feel free to contact me and I’ll do my best to help you.

What is a Certified B Corp?

A Certified B Corp is a business that has met high standards for social and environmental performance. For more information, see What is a B Corporation?: Everything You Need to Know.

What are the B Corp requirements?       

The B Corp requirements reflect the stringent process that companies must go through to get certified. For more information, see B Corp Requirements: The Essential Guide to Certification.

What are the benefits of B Corp Certification?

The benefits of B Corp certification are many, ranging from access to a community of changemakers to improved recruitment and retention opportunities. For more information, see Why Become a B Corp? The Benefits of B Corp Certification.

How long does the certification take?

The BIA can take some time to complete. Two factors that may determine how long a company takes to complete it include capacity and improvements needed. First, companies that have limited capacity often take longer to complete it and often need to bring in outside assistance. Second, companies that have to make many improvements to reach the 80 points needed to get certified will often take longer than companies that might have a high score due to the beneficial practices already in place.

Once the BIA is completed and ready for review, B Lab may take several months to initiate and complete the review process due to increased demand for the certification.

How long does the certification last?

B Corp Certification lasts for three years. After three years, a company must recertify by completing the BIA again and submitting it for review to B Lab. The performance standards also get updated every three years. As a result, a company will always recertify on an updated set of standards. Continuous improvement is built into the process of being a B Corp!

What is the cost of B Corp Certification?

Fees to B Lab are paid annually and are based on a company’s annual revenues. You can see their fees at https://usca.bcorporation.net/process-requirements-fees/ (scroll down).

Is my company a good candidate for B Corp Certification?       

The B Corp certification is incredibly robust yet flexible, allowing sole proprietors, subsidiaries of multinational corporations, and everyone in between to get certified. Certified B Corps represent over 160 industries in more than 90 countries. 

In our experience, the key indicator of whether a company is a good candidate for certification is leadership commitment to joining what is still a relatively new movement: there are only 7,000+ B Corps in the entire world. It is still a movement for early adopters.

What is a Benefit Corporation?

A Benefit Corporation is a corporation that has a legal requirement to create a public benefit and to take all stakeholders (not just shareholders) into account in its strategy and operations. It is a legal entity that a company can choose, similar to a C Corp or an S Corp. It is different from a Certified B Corp, which is a company that has voluntarily met an independent set of standards for social and environmental performance and received a third-party certification as a result. For more information, see Benefit Corporations: What You Need to Know.

Can an LLC become a B Corp?

Yes! In addition to meeting the performance standards, LLCs will need to add a Purpose & Director’s Clause to their Operating Agreement. For more information, see B Lab’s Legal Requirement tool.

My company is already a C Corp or S Corp. Should I become a B Corp?

B Corps and Benefit Corporations are two different things that are commonly confused. A Benefit Corporation is a legal entity, similar to a C Corp or S Corp. In addition to meeting the performance standards, S Corps and C Corps will need to become Benefit Corporations to meet the legal requirement for certification. For more information, see our article about Benefit Corporations.

We already operate like a B Corp. Why should we get certified?

While many companies share similar values, Certified B Corps meet the highest standards of verified social and environmental performance, transparency, and accountability. They commit to a rigorous process that helps them to uncover their own blind spots and make improvements that they might not have considered on their own. They recognize that the certification itself is not the end goal and that instead it actually marks the beginning of their journey towards greater impact. 

No one “should” get certified; rather, CEOs and founders need to decide for themselves if they want to embark on a rigorous path of continuous improvement as part of a global community committed to changing the way that business is done. For more information, see Why Become a B Corp? The Benefits of B Corp Certification.

I’m a sole proprietor or micro business. Can I get certified?   

Yes! Many B Corps are run by solopreneurs. Cultivating Capital was certified as a solopreneur business for several years before bringing on employees. Being a B Corp can amplify your voice as part of a larger movement while also providing a strong community to support you. Feel free to contact us if you would like to discuss this further.

My business is a startup. When is a good time to start the process?

Startups actually have an advantage in starting the process early because you can implement the right policies and practices from the beginning, rather than making changes later. In doing so, you’ll be building a stronger organization that will help you to maximize your impact. We can help you to build your business as a B Corp from the beginning. For more information, see B Corp Certification for Startups.

How does being a B Corp affect my taxes?       

B Corp Certification, as a third-party standard, does not have tax implications. Benefit Corporation is a legal status, not a federally-recognized tax status. You can still file taxes as a C Corp, S Corp, LLC, or sole proprietor. An accountant or B Corp CPA should be able to assist with this.

My business is due to recertify and I would like to raise our score. Can you help?

Yes! We work with businesses that are recertifying in addition to those who are certifying for the first time. We helped one client increase their score from 85.9 to 137.6, a 51.7-point increase! Other clients have seen score increases of 20-30 points, while others have earned Best for the World recognition, which recognizes B Corps that score in the top 5% of each category on the BIA. 

We can’t guarantee that your results will be the same, but we can help you uncover ways to improve your impact, formalize your practices, and get points that you might otherwise overlook. 

I’m stuck and can’t get to 80 points. Can you help?

Yes, this is exactly what we do! We’ve helped clients who have been stuck before and have been able to help them to get certified. When someone is stuck, it’s often because the questions don’t make sense to them, they answer them incorrectly, or they don’t know how to implement a specific practice. Because we have spent countless hours going through multiple BIAs across different industries, we can quickly identify where and how to correctly answer questions and increase your score.

I already submitted my BIA but didn’t get certified. Can you help?

Yes, we’ve helped several clients in this situation! Similar to when a business is stuck, we can work with you to correctly fill out the BIA, prepare the documentation, and then resubmit your BIA to B Lab for review. One of our favorite experiences is when we can help a client who didn’t think they could ever get certified achieve certification!

Do I need to hire a consultant to get certified or recertified?

No, many businesses are able to get certified and recertified without a consultant. However, clients find that hiring a consultant is helpful due to the complexity of the Impact Assessment, the documentation required, and the time involved. Similar to other work such as updating your website or preparing your taxes, completing the Impact Assessment can be done by anyone but will generally be done more accurately and in less time by an experienced professional.

The Cultivating Capital team has expertise in completing the BIA, navigating the certification process, and working with B Lab’s standards analysts to complete the final review process. We work to help companies move quickly and efficiently through the certification process, ensuring that they avoid the pitfalls so that they can successfully achieve their goal: getting certified or recertified as a B Corp. Our clients have provided numerous testimonials about our work.

We’re talking to different consultants. How do we choose one?

Choosing a B Corp consultant is similar to hiring a consultant in any other field. You’ll find a wide range of experience levels, from brand-new consultants who are just getting started to established professionals with a significant amount of expertise. For a list of specific considerations, check out our article on hiring a B Corp Consultant.

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