Benefit Corp chart for more specifics.) Benefit Corporation Vs. Certified B Corp in Plain English. Conclusion. Many clients ask us about becoming a B Corp and whether it’s right for them. Though for-profit social enterprises can apply for B Corp certification, B Corps don’t necessarily have to be social enterprises. Wrong. tit. This allows them to display the B Corp badge on their website and literature as long as they pass B Lab’s biennial evaluation. Benefit Corporation vs. B Corp Certification This is often a source of confusion for entrepreneurs, but the Benefit Corporation form should be distinguished from the B Corp certification, which is a social and environment impact certification from B Lab, and not its own legal corporate mechanism. Benefit corporations must consider how their selections affect both shareholders and stakeholders. Both strategies put the public and potential investors on notice that the company is not purely driven … To learn more about becoming a public benefit corporation, click here: http://benefitcorp.net/businesses/how-become-benefit-corporation. Many clients ask us about becoming a B Corp and whether it’s right for them. Unless you have a tax-exempt status associated with your B Corp, your organization is still going to be responsible for paying the same taxes as any other organization. A B Corp certification is voluntary and can be discarded at any time. Being a benefit corporation or a B Corp is a public declaration that you’re subscribed to a movement that uses business to do good. More information can be found, . Both strategies put the public and potential investors on notice that the company is not purely driven by profit, but also by creating a social impact. Being a benefit corporation or a B Corp gives you the opportunity to make a very public declaration that you care about more than profit. Public Benefit Corporations. Although you may see a benefit corporation referred to as a B Corp, technically it's not a B Corp unless it has been certified by B Lab. A public benefit corporation is a legal incorporation available only in certain states that allows organizations to identify a purpose beyond maximizing shareholder value. We recommend you consult with a legal professional regarding the legal entity structure that best fits your startup’s needs. To become a benefit corporation, a company must incorporate as one in one of the regions where it is available. 1. A new corporate structure requires companies to look beyond the interests of shareholders and to consider the effect of decisions on employees, the … B Lab provides additional certification (B Corp) if organizations choose to pursue it, but benefit corporations do not need to be certified as a B Corp. You can still get the "B Corp" designation from them if legislation is not available in your state, but you do need to be a for-profit entity. Learn more about benefit corporation requirements. More information can be found here. The comparison isn’t apples to apples. For those unfamiliar, it requires three key elements: purpose (create a material positive impact to society), accountability (consider nonfinancial interests in decision making), and a fair return to all shareholders with transparency (open disclosure of social performance using third-party standards). As a public benefit corporation, Binary Bridge is accustomed to transparently and intentionally balancing the traditional profit-turning corporate mission with a desire to make a difference. Rebuilding insurance as a social good, rather than a necessary evil, is now part of our legal mission. There are no additional tax benefits associated with this status. Becoming a public benefit corporation “protects mission through capital raises and leadership changes, creates more flexibility when evaluating potential sale and liquidity options, and prepares businesses to lead a mission-driven life post-IPO,” according to benefitcorp.net. It took me 12 months of research, over 100 interviews and writing a 240-page book, but I finally figured out the difference between Certified B Corps and benefit corps. Performance: The company must achieve a minimum verified score on the B Impact Assessment; and recertification is required every two years against the evolving standard. Of course, it depends on your vision for the company. Becoming a Benefit Corporation, on the other hand, involves permanent changes to the company's structure. Both meet higher standards of accountability and transparency. A benefit corporation’s directors, in making decisions and discharging their duties, must take into account various factors, such as whether they are furthering a general public benefit, as well as the impact of their decision on their shareholders, employees, community, and the environment. If B Lab is to achieve its transformative vision — “that one day all companies compete not only to be the best in the world, but the best for the world” — then the big, publicly traded companies that dominate the U.S. economy need to become B Corps. The benefit corporation is a legal structure for a business, like an LLC or a corporation. 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