Social enterprises exist in the convergence space between traditional for-profit companies and nonprofit organizations. New corporate forms and certification programs have emerged to help distinguish social enterprises, and the work they do, from the rest of the field. Here’s a quick overview of the main approaches. You can explore deeper by selecting links at the bottom of the page that will take you to other sources with more detail.
Back in 2006 a group of social entrepreneurs got together and thought there must be a way for purpose driven companies to distinguish themselves. They set out to create a new form with new ways to approach measuring impact. This was done under the B-lab name, and the new certification process they created was a designation that could be earned via an assessment process called a B-Corporation (B-Corp for short). The campaign became so successful, that it spread globally. Today, there are over 15,000 organizations around the world who use the B-lab Assessment Tool and roughly 1500 organizations that are B-lab certified. And that’s not all – they knew that the field could be expanded if there were a special legal for-profit corporate form created that helped eliminate stakeholder risk for investing in activities that produced social outcomes instead of purely profits. So B-labs created the first templates that were used by states and local social business advocates to legislate the creation of benefit corporations. Minnesota’s PBC law, which this chapter co-sponsored and helped craft, and ultimately pass, became effective January 2nd, 2015.
A benefit corporation is a new class of corporation that voluntarily meets higher standards of corporate purpose, accountability, and transparency.
Benefit Corporations: 1) have a corporate purpose to create a material positive impact on society and the environment; 2) are required to consider the impact of their decisions not only on shareholders but also on workers, community, and the environment; and 3) are required to make available to the public an annual benefit report that assesses their overall social and environmental performance against a third party standard.
Becoming a benefit corporation gives entrepreneurs and investors an additional choice when determining which corporate form is most suitable to achieve their objectives. Since the law’s inception in Minnesota January 2nd, 2015, there are now over 30 new PBC’s taking root here.
Dansko is a leading developer and marketer of premium comfort footwear, as well as a Founding B Corp. It was founded in 1990 with its signature simple flexible-bottom clog. Since then, its footwear has grown to include both casual and dress shoes that range from sandals to boots. All of their products strive to bring comfort and relief to one’s feet, especially if standing or walking for long periods of time.Read More