Obtaining the B Corp certification for your business sends a clear message to all stakeholders: your business believes in being a force for positive change. The path to certification can be arduous, but for companies with social and environmental commitments baked into their DNA, it’s a powerful public identification.
If you decide the B Corp certification is a good fit for your company, Watershed can help. Our customers already have access to their environmental data at their fingertips, and our reporting tool will auto-generate responses to a large portion of the questions needed for certification.
This guide will walk you through the process of achieving–and maintaining–this status, with an emphasis on the environmental assessment.
[infobox] What’s the difference between a B Corp and a benefit corporation?
A benefit corporation is a legal designation for a type of corporate structure in which acting for the public good is embedded in a company’s legal charter.
B Corp certification is not a legal designation. It is a certificate issued by the non-profit B Lab. Businesses are not required to be benefit corporations to apply for B Corp certification, but it is one way to satisfy the legal accountability requirement for B Corp certification.
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How do you get B Corp certified?
B Corp certification is administered by B lab, a nonprofit organization. Depending on the company size, type (LLC, partnership etc.), or industry, the certification process can vary.
Certification has three main requirements:
- Companies must have a ‘stakeholder governance’ model, which legally binds a company to consider all stakeholders, not just shareholders.
- Companies must pass the B Corp Impact Assessment.
- Companies must undergo a comprehensive review and make transparent and available the review’s results.
To maintain their status, B Corporations must update their Impact Assessment and score every three years. The assessment consists of about 200 questions in five different areas: environment, governance, workers, customers and community. The impact assessment is rigorous and can be a difficult process.
Here are some example questions from the environmental assessment:
Environment:
- How does your company manage its greenhouse gas emissions for at least Scope 1 and 2?
- What percentage of energy use is produced from low-impact renewable sources?
- What practices has your company implemented for a majority of suppliers (on a cost basis) to reduce the greenhouse gas emissions produced through your supply chain?
- What percent of raw materials (in currency terms) grown or harvested was spent with suppliers located within 200 miles (or 322 km) of where the end product was used during the last fiscal year?
- During the last fiscal year, what percentage of your products sold had a product certification that assesses the environmental impacts of the product or its production process?
- Have you reduced the ton miles (relative to revenues) of your distribution and supply chain, and if so, by how much?
Watershed can auto-generate responses to more than half of the questions in the environmental impact assessment.
B Impact Assessment pain points
From our work with customers who have applied to achieve or maintain their B Corp status, we’ve learned of a few challenges some businesses experience.
Gathering and organizing data from across the organization in order to complete the assessment can be complex and time-consuming. According to the B Lab website, “Small to medium sized companies should expect a wait time of 6-8 months. Large multinationals, companies with many related entities, or companies operating in controversial industries should expect a longer verification process.”
Watershed clients and sales prospects have also noted that by default the assessment process is largely self-guided. Without support, it can be difficult to answer the questions on the Impact Assessment in a way that effectively allows a company to meet the requirement.
How can Watershed help?
Watershed helps our customers with the environmental section of the B Corp Impact Assessment. The environmental section assesses a company’s stewardship of climate, land, biodiversity, wildlife and waste practices.
Imperfect Foods is a long-time Watershed customer that used the Watershed platform to help with its B Corp certification process in 2021.
"B Corps use the power and speed business to build a more sustainable world, which deeply aligns with Imperfect Food's mission to eliminate food waste and build a better food system for everyone,” says Rose Hartley, the Head of Sustainability at Misfits Market and Imperfect Foods.
“We appreciated Watershed's support during the B Corp application process, particularly for several of the climate-focused questions, including our carbon footprint and reduction strategies." Misfits Market acquired Imperfect Foods in fall 2022, and is currently in the process of applying for B Corp certification for the new, combined company.
The Watershed platform automatically generates responses for over half of the B Impact Assessment's Air and Climate subsection using our customer’s emissions data. Watershed’s climate advisory team can then fill in the gaps on the remaining environment questions, and provide guidance on how to optimize an organization’s B Corp score.
