Certifiably Sustainable: The Journey of a B Corp
Vivobarefoot knew, almost from the start, that it wanted to be a B Corp.
The minimalist-footwear company got its wish last September, joining the likes of Eileen Fisher, Patagonia, Toms and other mission-driven businesses that hew to exacting standards of corporate governance, worker engagement, environmental management and transparency to balance profit with purpose.
“Vivobarefoot was set up to be a benefit to society, to be a net-positive business for people and the planet,” Galahad Clark, the seventh-generation Clark Shoe dynasty scion who founded the brand in 2012, told Sourcing Journal. “B Corp status helps to ground our impact to society, set priorities, improve our policies, learn from the community and overall make us a better business and organization.”
In recent years, a B Corp—or benefit corporation—designation has become industry shorthand for companies that “aspire to do no harm and benefit all” through their products and practices. B Corps, according to B Lab, the Pennsylvania-based social enterprise behind the certification system, are legally required to consider the impact of their decisions on workers, customers, suppliers, the community and the environment. “This is a community of leaders, driving a global movement of people using business as a force for good,” it notes on its website.
The process of becoming a B Corp is an exhaustive one that can take a full year. To qualify, a company must first score at least 80 out of 200 points on a comprehensive questionnaire known as the B Impact Assessment (BIA). It takes between one to three hours for a small company to complete a “rough baseline” that is later verified in greater detail by an in-house standards team, according to B Lab. Questions include how diverse and inclusive management teams are, what percentage of energy stems from renewable sources, how much the lowest-paid workers make and whether social and environmental criteria are required of suppliers. Those who are successful have to post the results of the assessment on the B Lab website.
“It’s very hard to pass the assessment,” said Annie Agle, director of brand and impact at Cotopaxi, which became a B Corp in 2015, one year after the Salt Lake City-based outdoor-wear brand was founded. “It really is the anti-greenwashing assessment. It looks at your entire company from a very holistic process, so you can’t just be focusing on sustainability or giving in one portion of your business. You have to be thinking of corporate social responsibility in a very complete way across your company.”
Nor is hanging on to the status any easier. B Corps are required to recertify every three years, which may include an on-site audit. Jay Coen Gilbert, one of B Lab’s founders, has described the sticker as “like the Fair Trade label but for a whole company, not just a bag of coffee.” It’s caught on: Since the first B Corps were certified in 2007, their ranks have swelled to more than 3,500 across 70 countries. Maryland became the first state to formally recognize B Corps in 2010; today, more than 40 states have proposed or passed legislation acknowledging B Corps.
It was the idea of folding its values into its articles of incorporation that convinced Patagonia to sign up in 2012—the first company in California to do so. “We would essentially make it really difficult, if anybody ever bought stock into Patagonia, for them to drift from the core values of the company,” said Vincent Stanley, director of philosophy at the outdoor-apparel brand. But there were other perks to the process the company hadn’t expected despite its due diligence pushes.
“The BIA is the only holistic look we have on how we affect each of our stakeholders, the health of the business, our employees, suppliers in the countries we operate in and nature itself,” Stanley said. “It [also] helps us look at where we feel we have shortcomings [that] we need to improve.”
This has led to growth. Patagonia used to “pat ourselves on the back” because of the number of products it made with recycled content. “But the BIA required us to look not by the number of styles but by fabric weight. And then we didn’t look so good, because some of our best-selling styles were not recycled. That inspired us to make changes.” The company also realized it was lagging in community efforts, so it took extra steps to bolster them.
The score can be a good gauge of how a company is faring, but chasing a number without reflection would be a mistake, Stanley said. It isn’t easy avoiding the comparison game, either. “What you’re really trying to do is to make improvements, but it is hard. Once you have the number assigned, people get competitive,” he said. “We’re at 151 and when we look at Dr. Bronner’s, which has 175, [we can’t help but] think, ’Oh my gosh, what are they doing that we’re not doing?’”
Patagonia’s most recent score was a tenth of a point less than its previous one, but that was partly because B Lab increased its standards. “We’re not trying to game the system,” he said. “We’re trying to use the information we get from every assessment to make improvements for the future.”
Athleta, one of the first Gap Inc. companies to set its own sustainability goals and the only one to be B Corp certified—the athleticwear purveyor received its bona fides in 2018—also found the certification journey a humbling one. “We knew we were doing great work, but after digging into the nuances behind the questions in the process, it turned out we had a long way to go,” said Emily Allbritten, its senior manager of retail strategy and operations. “After certification, we set up internal working groups focused on our long-term success. This allowed us to determine a roadmap for future programmatic investments and grow and scale programs based on the assessment.”
Attaining the B Corp imprimatur can be a “good return on investment” from a business standpoint, too, she added. Surveys consistently show that consumers—millennials and Gen Z-ers, in particular—both desire and are willing to pay more for ethical and sustainable products. “Being a B Corp is a core component of our story as a socially responsible company,” Allbritten said. “The recognition shows our customers that we walk the walk. We’ve worked hard to translate the complexity of being a B Corp into digestible, marketable information for our customers.”
Other value-chain stakeholders might reward B Corps as well. “I’m always surprised by how many of our suppliers really like that [Cotopaxi is a] B Corp,” Agle said. So do its customers: REI, its biggest wholesale partner, favors B Corps, as do its investors, who like that they can leverage the BIA’s granular approach to help them with their due diligence reporting.
One of the biggest advantages of being a B Corp, however, is the community they can tap into, brands say. Agle says she often reaches out to her counterparts at Eileen Fisher and Patagonia for sustainability or sourcing advice. “They have been so generous with their knowledge with us,” she said. “They didn’t have to do that. It’s a very refreshing approach to business support.”
Still, for Vivobarefoot, a B Corp label is only the beginning. While it was already off to a running start, garnering an initial assessment score of 98.8 out of 200 points—higher than rivals Veja, which received 84.2, and Allbirds, which clocked in at 89.4—it didn’t go from “zero to hero” as a result of the process, said head of sustainability Emma Hamilton-Foster, adding that the designation is only “one aspect of a much wider and organic/regenerative/sustainability ethic that has been part of Vivobarefoot’s DNA since its conception.”
“It gives legitimacy to some of our efforts, but not all,” she said. Vivobarefoot would like to see B Corp employ a more integrated framework that meshes impact with finances. While the assessment devotes a lot of space to governance and workers, it provides little information on how to shift from “mechanized hierarchal organizational structures.”
“We are actively engaging in both areas and [it] feels like we’re having to beat too much new ground on both,” Clark said. “There are plenty of companies out there doing both in very interesting ways and I think it’s important for [B Lab] to pull together more tools and best practice to advance these essential elements of business as a force for good.”
Divya Demato, CEO of GoodOps, a sustainable supply-chain consultancy from San Francisco, agrees achieving a B Corp designation is a “great first step,” especially now that sustainability and social responsibility are no longer simply nice-to-haves. As mandatory due diligence legislations start to move down the pipeline in Germany, the Netherlands and across the European Union, however, the “real work” will be the validation of these assessments. Currently, 10 percent of recertifying B Corps are selected for on-site audits, a number Demato thinks could be improved upon. More than ever, she said, brands will need to dig deeper to uncover the hidden corners of their supply chains where abuses can lurk.
“I think what’s going to happen is you’re going see more brands having to take alternative or additional measures to really understand what’s happening on the ground and making sure that the documentation and claims by suppliers, whether first tier, second tier [or] third tier are actually true,” she said. “My big call to brands and companies is don’t stop there—keep going.”
By Jasmin Malik Chua from Sourcing Journal.