fact

Businesses Can Implement Social Sustainability at the Entity Level

Whether by becoming a Benefit Corporation and/or a Certified B Corporation®, or one of the other options available (e.g., social enterprise structures), social sustainability can be baked into the very structure of a company. Using one of these measures makes it especially clear to customers that social sustainability is part of the company's purpose.
Aug 13, 2021
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Businesses Can Implement Social Sustainability at the Entity LevelBusinesses Can Implement Social Sustainability at the Entity Level
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"Social enterprise" is the term that describes a company that is implementing sustainability at the entity level. There are many things a company can do in order for it to be identified as a social enterprise, but what they all have in common is a focus on sustainability—either environmental, social, or both. In the same grain of purpose and profit being inseparable, social enterprises seek to maximize profits while also maximizing social benefit, usually by using profits generated to fund socially responsible endeavors.
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Organizations can contribute to social sustainability by developing businesses with the dual motive of making money and contributing to social change. Social enterprises, as they are called, deal with an environmental or social problem through a “market driven approach,” the Social Enterprise Alliance says. Through their product, employment opportunities, philanthropic work or other business practices, these organizations address a problem while also seeking to make profit. As the idea of a social enterprise has generated more and more buzz over the years, the definition of the term social enterprises keeps evolving. An article on B the Change noted that at its core, an organization should commit to a social or environmental cause to be a social enterprise. Once it does, there are a few ways it can go about it -- through its business activity, fundamental/legal paperwork, a side-project or philanthropy. While there is no consensus on the definition of the term social enterprise, as the article said, that has paved the way for the term to be flexible, consisting of a myriad of business models, including those like public benefit corporations, Certified B Corps, etc. In its generous definition, social enterprises, today, also include nonprofits with a revenue-generating model like Girl Scouts of America. In a more traditional sense, for-profit organizations, like Goodwill, which emphasize on making profit by fulfilling a social mission, make the cut for a social enterprise. Apart from being a one-stop-shop for used personal and household products, Goodwill, since its inception, has provided employment opportunities to people for whom jobs are scarcely available. According to the Social Enterprise Alliance, in 2014, Goodwill created employment and job training opportunities for more than two million people while earning a revenue of $4.6 billion. Businesses that are driven by a profit-making primary activity and address social problems through their business practices, like helping out their employees, community, etc. are also a part of the social enterprise bubble. Companies like benefit corporations, which are legally registered with their states as such, and Certified B Corps, which are certified by the nonprofit B Lab U.S. and Canada, fall into this category. Then there are businesses which contribute to sustainability through their donations. Warby Parker, an online retailer for prescription glasses and sunglasses, has a “Buy A Pair, Give A Pair'' program. The program donates a pair of glasses for each pair bought. Addressing lack of access to eye-care and glasses across the world is one of its core missions. Although social enterprises already consist of different types of business models, there is no tapping this category. There are various types of organizational models: cooperatives, awareness brands, etc. that contribute to social sustainability in different ways, overlapping with already established structures in some ways and unique in some others. The overarching objective of any organization with a social purpose is to do good and help alleviate a social problem. As corporate conscience continues to develop and customers continue to demand more accountability from organizations, the space for different types of social enterprises, seems as it is going to continue to expand.
Another way is through the B Corporation certification process. As legally verified and publicly accountable businesses, a Certified B Corporation® (or B Corps as those of us in the movement like to refer to them as) must prove their sustainability record to maintain their status. B Corps can make a huge impact globally. And because they are audited by a third party and have to show continued improvements over time in order to maintain their status, they can't just make empty promises.
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A short, 30-second video by B Labs explains the substance behind the B Corporation certification.
B Corporations, commonly referred to as just "B Corps," are businesses that have been certified by the non-profit company B Labs based on exacting standards of social and environmental performance, public transparency, and legal accountability. This certification causes B Corps to become legally bound to balance purpose and profit by considering the impact of business decisions on all stakeholders, including employees, suppliers, customers, the environment, and community. To become certified, companies must conduct a comprehensive review of their sustainability profile using a template provided by B Labs known as the "B Impact Assessment." According to B Labs, this assessment is "designed to help measure and manage [a] company's positive impact on [its] workers, community, customers and environment." Companies must also take a further step of incorporating "specific mission-aligned language" into their governing documents, such as the articles of incorporation. Once certified, B Corps must re-certify every 3 years by updating their assessment, providing additional documentation to verify their answers, and achieving at least 80 out of 200 available assessment points. Additionally, to maintain the credibility of the B Corp seal, 10 percent of re-certifying B Corps are audited in the form of an in-depth site review. B Corps have proliferated since the first 82 were certified in 2007 There are now over 3,500 in over 70 countries. One example of a B Corp making a positive impact is Cora, which provides eco-friendly feminine hygiene products, increases access to feminine products in developing countries, advocates for female education, and speaks against taxing these types of products as non-essential goods. Since the company’s inception, Cora has donated over a million sanitary products to women in Kenya and India. It also has donated over 100,000 feminine products to women living below the poverty line in the United States. Evolution Marketing, a Wisconsin-based company focused on sustainability, marketing, and communications consulting, is another B Corp. In 2019, Evolution Marketing donated 2% of its sales to environmental non-profits, and another 0.5% of sales to Wisconsin-based, socially-oriented non-profits. Additionally, members of the staff donated 238 hours of time/services to Wisconsin-based non-profits and their environmental and social programming. The company also submits to additional third-party verification, such as a yearly certification by the non-profit organization 1% For the Planet. Other B Corps range from huge household names such as Danone North America and Ben & Jerry’s to local Wisconsin product makers such as Rebel Green, Zyn, Just Coffee Cooperative, and Tribe 9 Foods, demonstrating that this business model is both achievable and scalable. B Corps are arguably the business model of the future—one that modernizes the sustainability movement by getting private businesses to tackle important social issues.
CLOSURE
Clearly, there are options available to companies that want to embed social sustainability into their very core. It's about time that companies have a way of standing up for people and their communities.
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