Throughout our Sustainability Marketing Class, we regularly hear companies that truly embody the idea that short-term profits should not come at the expense of humanity or the planet. Patagonia, Ben and Jerry’s, and Seventh Generation, to name a few are highlighted in the vast initiatives they undertake
to benefit not just their shareholders, but all stakeholders. What do all these companies have in common? They are all B Corp Certified – but is this truly the gold standard when it comes to sustainable companies?
The Idea for B Corp was founded in 2006 by a group of students at Stanford University and has now expanded to include over 3,500 companies around the world. To obtain B Corp status, companies must meet a minimum score of 80/200 on the B Impact Assessment, have it verified, and pay a certification fee. These scores are based on various ESG initiatives such as paying fair wages and reducing waste. Companies who show high social and environmental performance, make legal commitments to improve its governance structures, and are willing to be transparent about their progress are often successful.
In theory, companies that tackle a wide range of ESG issues should be rewarded, but there are some doubts surrounding the legitimacy of B Corp. For one, there is little transparency in the verification status. Additionally, B Corp doesn’t include impact assessments on their firms in comparison to other non-B Corp firms, meaning there is little data to indicate if having a B Corp Certificate improves a company’s triple bottom line. Lastly, as a checklist, B Corp’s often overlook substantial issues for companies who still meet the minimum 80-point threshold.
These issues really came to light with the induction of Nespresso in May 2022 after they achieved an 84-point score on the Impact Assessment. Recently, the Fair Trade World Project called out the B 
Corp Certification, as Nespresso has had a history of human rights violations on farms where their coffee is grown. Additionally, their aluminum pods are known to be challenging to recycle and require intensive resource-extraction to create. When the certificate overlooks two massive issues core to their entire company, it’s difficult to say whether a “gold standard” should be placed upon them.
Despite criticisms, there is no doubt that B Corp Certification requires substantial work in a company’s long-term sustainability for its stakeholders, but we may need additional ways to evaluate a company’s true value.
Sources:
https://www.sustainablejungle.com/certifications/b-corp-greenwashing/
https://theconversation.com/b-corp-certification-wont-guarantee-companies-really-care-for-people-planet-and-profit-124459
https://www.bcorporation.net/en-us/certification
Shreya Karthik
April 2, 2023 — 2:41 pm
Hi!
This is a thought-provoking article on the legitimacy of B Corp Certification as the gold standard for sustainable companies! You raise valid concerns about the transparency of the verification process, the lack of impact assessments, and the possibility of overlooking critical issues in companies that meet the minimum threshold. I buy Nespresso coffee pods but I always wonder about the pods being hard to recycle. I was surprised to find out about the history of human rights violations. I wonder what is the alternative packaging for the coffee pods.
However, I believe that the B Corp Certification is still a step in the right direction for companies that prioritize sustainability and stakeholder value. While it may not be a perfect solution, it provides a framework for companies to assess their ESG performance and make improvements. It also allows consumers to make informed choices about which companies to support based on their values.
Thank you!