The company must adhere to the B-Lab regulation in its corporate legal structure to qualify for the certification process. At the end of the assessment, companies must meet certain transparency and background check requirements to become B Corp certified. These requirements include: an in-depth review of public records of companies, employees, products and other related topics, as well as random site visits. [24] In Massachusetts or states that recognize B Corporation certification, it has no legal meaning for its shareholders, stakeholders or employees. However, certification brings a variety of branded tools to the company. [4] One of the issues with the decision to be certified B Corporation would be the administrative and legal costs that a company incurs when it changes its business model under the B Labs regulation. [3] Note: This article is published for informational purposes only. This is not an actual agreement or a complete description of certification requirements. See sample agreements below, available in English, Spanish and Portuguese. You have now been certified! To meet the transparency requirements for B Corp certification, you must publish your public profile in the B Corp directory, including your company`s score and impact report.
B Corp`s legal framework aims to clarify in its administrative documents what language companies must adopt and where, so that their commitment to stakeholder governance is enforceable. Any changes to B Corp`s standard legal framework – including changes to language wording, language placement in relevant Company documents, or where B Corp`s legal framework exists (e.g., Articles of Association, Partnership Agreement) – will be reviewed for certification. In the event that the actions taken to comply with the legal requirement violate applicable law in the Company`s jurisdiction, the Company will work with B Lab to determine the appropriate legal path. Any changes must be reviewed by B Lab in advance to avoid additional delays in the certification or correction process. B Companies integrate stakeholder considerations into their legal structures to create long-term value for shareholders and stakeholders. Companies must comply with the relevant legal requirements within the timeframes specified in the agreement as a prerequisite for certification. The legal requirements of the company and the timing of the process are determined by the structure of the company and the responsibility of incorporation. Please read the Legal Requirement tool to see the legal pathway applicable to your business and Appendix D of the agreement for more information on the legal requirement (including the company`s obligations if B Lab does not already have a legal framework in its jurisdiction) and the deadlines for accepting the legal requirement. First, the phrase “I want to be a B Company” is often used interchangeably to refer to incorporation or conversion to “Benefit Corporation” or applying for and certifying as a certified B Corp – however, Benefit Corporations and B Corps are not synonymous. Below, we (i) explore the differences between a charitable corporation and a B Corp, (ii) summarize the characteristics of a Delaware public benefit corporation (a type of charitable corporation) and a B Certified B Corp, and (iii) discuss some important aspects to consider before deciding whether to incorporate as a charitable corporation or obtain B Corp status.
What is timing? B Lab understands that changing your legal structure may take some time, so all B Corps have a certain amount of time to make the legal change after certification. We envision a global economy that uses the economy as a force for good. This economy consists of a new generation of companies – the B Corporation – that is goal-oriented and creates benefits for all stakeholders, not just shareholders. Benefits of incorporation or conversion to PBC include: Pending B Corp status allows a start-up to indicate to clients, employees, and investors that the startup has a charitable purpose and is being managed in a way that aligns that purpose with shareholder value. Once the company has been in operation for more than 12 months, it can apply to become a certified B Corp. However, obtaining “Pending B Corp” status is not a prerequisite for later becoming a certified B Corp. B Corporations or “B Corps” are companies certified by B Lab as meeting certain standards of social and environmental performance, accountability and transparency. No matter what its name suggests, a B Corp doesn`t have to be a corporation. A B Corp can be a limited liability company, partnership, sole proprietorship, etc. The information provided on this website does not constitute and is not intended to constitute legal advice. All information, content and materials available on this website are for general informational purposes only, and the information on this website may not be the most current information.