Are you a B-Corporation?

By | November 10, 2011

Note by the editor: This guest post article is for American readers.

If you’re looking to start a new company, you’ve probably debated about whether to form an LLC, S-Corp or C-Corp, but have you considered this new type of legal entity available in some states? A B-Corp, or Benefit Corporation, is a new form of incorporation that legally recognizes companies that “do good” while making a profit.

Dansko is a good example of a company that could be considered a B-Corporation. Dansko is known for its makes dress shoes, sandals and boots, but you may not know that they also incorporate efforts to effect social change into their for-profit business model. For example, Its office building is LEED® certified, it hosts West Grove, Pennsylvania’s only Community Recycling Center, and it pays its employees to take time off to volunteer, as well as match its employees’ salary and gives that amount to the organization at which they volunteer. You’ve probably seen Dansko at your local department store, but they also make efforts to effect social change as part of their Business Model. Dansko is just one example of a business that could apply for B-Corporation status.

Why become B-Corporation:

  • Brand Differentiation: Consumers are starting to demand more social responsibility from the companies they buy from. B-Corp status makes you stand out as a corporation that effects social change.
  • Discounts: B-Corp “service partners” offer discounts to B-Corporations
  • Investment: Unlike non-profits, B-Corps can attract outside investors.
  • Collaboration: B-Corps enjoy enhanced collaboration with other businesses that share their goals
  • Accountability: B-Corps can hold their directors accountable for decisions that impact their mission to meet social and environmental performance standards

Applying for B-Corporation status:

According to, corporations who want to become certified must take the following steps:

  1. Take, and pass, the B Impact Assessment and get a score of at least 80 out of 200.
  2. Adopt the B Corporation Legal Framework
  3. Sign a Term Sheet and Declaration of Interdependence to make the certification official.

Today it’s only available in a few states (California, Hawaii, Michigan, New York, North Carolina and Pennsylvania) but this new type of corporation could drastically alter the way we look at organizations and their ability to effect social change.

About the guest post author: Becky Canary-King is an Account Manager and Press Contact at Direct Incorporation, a company focused on providing a more economical and efficient alternative to using a law firm for common legal/entrepreneurial issues. She blogs for Direct Incorporation, offering tips for the first 6 months of your small business.