B companies differentiate from others by meeting the highest social and environmental standards. In other words, these are companies that are not only focused on making money but also on solving problems for the world’s well-being. They are also known as “purpose-driven companies.”
B companies are usually for-profit companies that have undergone a certification process overseen by the NGO “B Lab” or “Sistema B” for the Latin American territory. BIC companies are a term used in Latin America for companies with a similar DNA to B companies regarding their social and environmental purpose. However, they go through a different certification process, which in their case, is supervised by the federal government and regulated by laws.
In this article, we will tell you what B companies and BIC companies are. We will also go through the process that any company that wants to be certified under the B Lab standard must undergo and what are the benefits of being recognized as a B Company.
What are B Companies?
B companies intend to be the best companies for the world and not of the world.
These companies continuously measure their social and environmental impact and make decisions considering the consequences of their actions on the community and the environment. These companies want to change how business is done, using their strength to provide solutions to social and environmental problems.
To be certified as a B company, it is necessary to prove that the institution considers not only its economic profits but also the impact that its decisions have on its employees, customers, the environment, and society as a whole.
How many B Companies are there in the world?
There are currently 5537 certified B companies worldwide and 898 in Latin America (August 2022). In addition, more and more companies are seeking to transform their DNA to generate a collective impact and acquire the B corps certification.
The four key elements of B companies
B companies have four key elements:
- Purpose: They must demonstrate motivation for positively impacting society and the environment.
- Legal requirements: Owners and shareholders must extend their fiduciary duty to include non-financial interests.
- Certification: To become a B corporation, they must undergo a certification process where they commit to improving their management standards and transparency.
- Interdependence: Companies must accept that they are part of an interrelated community.
The B Impact Assessment measures and analyzes a company’s 5 most relevant areas: Government, Employees, Customers, Community, and Environment.
Minimum requirements to be a B Company.
Any company wishing to certify under the Sistema B standards must comply with specific requirements:
- Be in operation for more than 12 months
- Work as a for-profit entity
- Operate in a competitive market
- Constitute an entire business (subsidiaries or individual brands of a company are not accepted).
- Meet the legal requirements of a B Corporation
How to certify as a B Corporation?
- Complete the B Impact Assessment: This free tool is available online to help measure and manage a company’s triple impact.
- Declare whether the company has a relationship with controversial or harmful industries or practices.
- Submitting the B Assessment for review: The company must score at least 80 points to submit its assessment for review and begin the formal certification process.
- Review of the company’s eligibility for a B Corp certification: This stage confirms whether the company meets the essential criteria to continue the process.
- 30% down payment: A fee proportional to the company’s profit is paid to obtain the certification.
- Assessment and verification: B Lab or Sistema B reviews each point of the completed impact assessment and the supporting documents for the information submitted in detail.
- Annual payment of the remaining 70%: The company pays the remaining 70% of the fee at the time of certification.
What is a BIC company?
BIC companies integrate economic, social, and environmental values in their businesses. BIC companies are not non-profits but a part of the world’s productive economy. What differentiates them is that they are conceived as projects that seek to generate a positive impact on society.
BIC companies is short for “empresas de beneficio e impacto colectivo”, which means “companies with a collective benefit and impact”.
There is a bill in Argentina to grant benefits to all companies that fall into BIC companies requirements. However, this project has not yet been approved for its implementation.
Peru, Ecuador, and Colombia already have a BIC law. This law aims to recognize the benefits they provide to society and this brings different incentives for them such as programs that facilitate access to loans and public procurement, among others.
What is the difference between a B company and a BIC company?
The main difference between these two companies is the organism that grants the certification and endorses the categorization of the project as triple impact.
In the case of B companies, certification is granted by an organization called B Lab, or Sistema B, in the case of Latin America.
In the case of BIC companies, what is modified is the bylaws or social contract, which would include the positive environmental and social impact of the company. This modification is made by the national government and not by a private organization like B Lab or Sistema B.
Both projects seek to create companies based on a triple impact economy, that consider not only the economic profits but also its environmental impacts from the moment of the project’s conception.
What are the benefits of being a B Company and BIC company?
Some of the benefits of BIC and B companies are:
- Social impact: BIC and B companies have a much greater impact on the world than traditional companies. This is because they focus on solving problems by creating a positive change in the world.
- Sustainable business: B companies make sustainable decisions that benefit their employees and customers.
- Reputation and sales: Certification gives a competitive advantage by endorsing positive behavior towards consumers, investors, and other stakeholders. This can lead to sales growth and potential benefits such as reduced tax rates. The certified B company logo is internationally known and substantially helps the company’s brand.
- Being part of an interconnected network of companies seeking the common good: By becoming a B company, you become part of a global movement of companies seeking to use their power for the common good.
- Attracting new talent: New generations prioritize working in companies with purpose.
B companies in Argentina: some examples
- Carbon Neutral +
- Aguas Danone Argentina
- Fracking Design
- The bottle
- Sustainable GEA
- Meraki Consulting
- Rosario Bio Energy
Here you can find the directory with all the B companies in Argentina and Latin America.
The B companies and BIC movements are gaining momentum. These corporations prioritize, above all things, their social impact and transparency, two aspects of business activity that investors and consumers have often overlooked in the past.
These companies can have a more significant impact on the world around them and more success in the long run.
Do you need help in the certification process as a B company or BIC company?
CARBON NEUTRAL+ can help you score points in the B Impact Assessment, specifically in the environmental part. Measuring your carbon footprint, operating with renewable energies, and offsetting your footprint are all activities that add points and that CARBON NEUTRAL+ offers.
In case you would like to request a demo to use the calculator and measure your company’s carbon footprint, please contact us.