If you’re in the final phases of opening your business startup, you likely know that you have to register your business in the state where you’re located. Registering for most small businesses often involves forming a Limited Liability Company or for those with more complicated business structures, a C corporation or S corporation may be more appropriate. Many business owners find using a business registration service to help in this process is well worth the small cost involved.
If you ask the person helping you in the process about forming a B corporation, they may tell you that it doesn’t exist but, in fact, it does.
The reason they don’t know about it is because it’s not a formal business structure like a LLC, C or S corporation. It’s something outside the legal designations but for many businesses it could result in higher sales and positive PR.
The B Corporation was started by B Lab, a non profit organization dedicated to using the power of business to solve some of the world’s biggest social and environmental issues. They envision using the B Corp designation to start a brand new sector of the economy that is committed to sustainability in all parts of the company’s business operations.
But qualifying for the designation isn’t easy. The owners of Mugshots Coffeehouse and Café, an organic coffee bar in Philadelphia, report the process to be time consuming but well worth the investment. They say that one of the B Corp requirements is a strong investment in their employees.
Before they applied for B Corp status, professional development was only available for 30% of their employees but because of the B Corp requirements, every employee now has access to the same enrichment programs. Consulting firm, Workplace Dynamics has changed its business practice to comply with B Corp standards including giving employees days off to participate in community events.
In order to gain certification, companies have to take a preliminary assessment and once they pass that and meet other requirements, an onsite visit is scheduled to verify the responses. Once a business is approved, they have to be recertified every two years.
Is it Right for Your Startup?
Many of the requirements for B Corp status are appropriate for every business and some owners report that better quality applicants seek them out when they gain the designation. For businesses that want to be eco-friendly companies, B Corp status is a great way to gain more publicity and visibility. You can read more by visiting their website.