4 min read
- Consumers are increasingly changing their behavior and abandoning leading brands in favour of those that seek to create positive societal value
- There is an increasing demand for traditional businesses and large corporations to shift their focus from maximizing shareholder value to a new motivation of maxmising stakeholder value.
- Find out how the B Impact Assessment is supporting companies in Singapore.
Last week I attended a workshop hosted by AVPN on B Corporations and Doing Business for Good, the new buzz word within the socially responsible and sustainable investing markets. Moderating the workshop was Marshall Worsham from B Academy Asia, who was joined by Tharani Prakash, from Pearl Consulting. They explored ideas about how they can attract more companies who have the intent of fostering a greater social outcome. As we went round the workshop to introduce all the attendees, it transpired that many people were interested in how they assess and define impact, what value a B Corp certification will bring as well as the general ecosystem in which it operates.
So what is a B Corp?
The term refers to a company that uses the power of business to solve environmental and social issues. Instead of adopting the conventional model of maximizing shareholder value, companies look at running their businesses from a different approach. Companies which focus instead on generating positive stakeholder value will ultimately lead to a more sustainable business, in turn leading to increased shareholder value in the long run. They operate with a need to align business with society and have coined the term ‘best for the world, not best in the world.’
There are currently over 2,000 B corporations globally, across all industries. In addition, global brands including Danone and Unilever are contributing to the movement of mainstream industry doing business with a social aspect.
Measuring Impact using B Impact Assessment
The challenge is there are many companies, who are conscious of their social impact and who want to be part of the initiative driving this change of business practices, but unsure as to where to start. As such, B Lab developed the B Impact Assessment (BIA) to help companies asses their business practices in line with a set of metrics. This can help them gauge their conduct and measure their externalities.
B Lab found using the BIA leads to concrete behavioral change, providing a peer group comparison as well as an assessment on how to improve business practices. Even though many companies which take the BIA may fail, we see they are at least thinking about making a change and trying to work towards better practices, and this is the movement we would all like to keep driving.
With a variety of impact assessments being offered on the market, the question we need to ask is: how do we use these to rally other organisations to get interested in either becoming a B Corp or investing in a B Corp?
Kevin Teo, Managing Director, Knowledge Centre, AVPN, highlighted the Impact Management Project, an initiative started by pioneers such as GIIN, TONIIC, Aspen and GSG, who wanted to pool their vast knowledge and align everyone’s language on the subject, promoting comparability. When we share a common objective, namely how are we advancing the beneficiaries of impact i.e. those whose lives we want to change, affinity groups and collaboration will develop around similar themes, generating critical mass and pulling more people in.
The representatives from a few certified B Corps based in Singapore were able to share their experiences with us. Yasmine Kahter, from VS Story, explained that she wanted her firm to be known as a ‘good company’. As her firm is very small, B Corp made it easier to comply with the requirements as they didn’t have the resources to follow through on their own. Sarah Cragg, from MullenLowe Salt, mentioned that large companies can use the certification to have third party verification, affirming that their operations are within boundaries. The certification thus brings trust and confidence in the company, as well as builds a community that supports each other where interests are firmly aligned.
The B Corp movement is firmly gaining traction worldwide, in terms of awareness, motivation and impetus. We need to harness this drive and see how to bring it to the forefront of Asia to continue growing and driving the momentum. When certifications come in, we can ensure the social mission is maintained.
AVPN is hosting a workshop at the annual conference on 7th June to further promote the B Corp movement.