In December 2011, New York became the seventh state to pass bi-partisan legislation to create a new type of corporation that is quickly becoming a household name – a Benefit Corporation. A B-Corp, for short, is required to do what other corporations cannot - consider its impact on equal ground with its bottom line. B Corporations must make a material positive impact on society and the environment and must meet higher standards of accountability and transparency than traditional corporations.
Maryland became the first state to pass this type of legislation in April 2010. Just 18 months later New York has joined a growing group of states – California, Hawaii, New Jersey, Vermont, and Virginia - interested in developing a new type of business and economy that incorporates employee, community, and environmental interests. This legislation especially aids social entrepreneurs who traditionally have had to balance the social or environmental goals of their business with the need to raise growth capital and generate returns for their investors.
In the same way TransFair certifies Fair Trade coffee or USGBC certifies LEED buildings, B Lab, a non-profit organization certifies B Corporations. As B Lab explains, B-Corps are different because they:
· Meet comprehensive and transparent social and environmental performance standards;
· Meet higher legal accountability standards; and
· Build business constituency for public policies that support sustainable business.
Across the nation, this legislation has received bi-partisan support with an overall vote tally of 892 ayes and 62 nays and signatures from both Republican and Democratic governors. To date, there are more than 517 Certified B Corporations with more than $2.9 Billion in revenues across 60 different industries.
