Impact makers
business models

The Rise of Responsible Business

These Days Companies Can’t Afford Not to Link Purpose with Profit.

Cotopaxi Luzon Del Dia daypack.

When Nicole Bassett envisioned how to run her company she did not go the conventional route. Yet, like other business leaders redefining success in today’s marketplace, Bassett’s focus on corporate accountability is paying off: The Renewal Workshop is thriving. It now has close to 18 brand partners, with more to come in the New Year, in addition to an expanded retail platform. And later this month Renewal Workshop will launch in Amsterdam to serve the European market.

“We do B Corp because we wanted to demonstrate to the world that there are better ways to run a business than the traditional model,” said Bassett, who co-founded the Oregon-based Renewal Workshop in 2015.

Certified B Corporations are businesses that meet the highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose. Certifying as a B Corporation goes beyond product- or service-level certification — it measures a company’s entire social and environmental performance.

Eric Henry was an early proponent of the B Corp model but just didn’t know it. Henry had developed a new sustainable screen-printing process for his t-shirt company, TS Designs, and was looking to take the company in a new direction. He was introduced to the triple bottom line business model by his good friend Sam Moore, and was impressed by its three equally important tenets: people, planet and profits. Armed with this new business model “and a healthy amount of crazy,” TS Designs aligned with a then-fringe group: The Green Movement. Learning from other progressive business leaders, and pushing the boundaries of sustainable practices, TS Designs was the first North Carolina-based company to achieve B Corp status.

Supply chains are complex, and we're not perfect, but conscious capitalism starts with conscious manufacturing.” — Annie Agle, Cotopaxi

“Being a B Corp raises the bar to how you look at, and run, your business,” said Henry, who admits that certification requires a lot of work. “It’s not just write a check and move on. The process really opens your eyes to what your business is about.” In a sign of the times, Henry mentions NC State University’s Poole College of Management’s team of interns available to help companies go through the B Corp process.

He recalls that in 2007 when he was considering a better model for TS Designs, the business mentality at that time was centered on how to increase the bottom line.

Certainly that conventional approach remains, however the appeal of B Corp management style is taking off. The first 82 B Corps were certified in 2007. Today there are 3,000 Certified B Corporations across 64 countries and 150 industries, according to B Lab, the global nonprofit that certifies and supports Certified B Corporations.

You can add Burton Snowboards and Kathmandu to that list; both companies announced certification in recent weeks.

“Burton has always stood for more than snowboarding,” said Donna Carpenter, Co-CEO of Burton, in an official statement. “Our values around community, sustainability and women’s leadership are as much a part of our identity as pioneering the sport. Now more than ever, companies need to step up and speak up on issues that impact the world we all share. So we’re all very proud to join the B Corp community, which shares our commitment to balancing purpose with profit.”

Burton is the first snowboard company to receive this certification, joining a growing B Corp community within the outdoor industry. United by Blue, TenTree, Patagonia, Klean Kanteen, Olukai and Cotopaxi, among others that have embraced a purpose-driven, “business for good” model.

Cotopaxi is a Benefit Corporation, which is similar but slightly different from a B Corp certification. Annie Agle, director of impact for Cotopaxi explains: “Benefit Corporation is a legal status, which allows the company to act in the best interest of society, even if it means going against the wishes of shareholders and owners. B Corps is an assessment that certifies that your company has a net positive contribution on society.”

Finding a Better Fit

Supply chain complexity is an established standard that young companies look to change to better fit their business models. “In terms of supply chain, our mindset is that you can’t just focus on design and use,” Agle offers. “Ninety seven percent of the carbon footprint of any item occurs during its production. And, we can’t try to alleviate poverty through grants tied to revenue, while disregarding the needs of workers. The B Corps assessment expects companies to have humane and environmentally sound supply chain practices, but we try to take it a step further as a supporter of the Sustainable Apparel Coalition and the Higg Index, which measure everything from over time payment of workers, to on site water recycling. Supply chains are complex, and we’re not perfect, but conscious capitalism starts with conscious manufacturing.”

And today’s consumers get it. “Our customers are our best allies,” says Agle. “They’re not just investing in our product; they’re investing in an alternative, morally sound economic model. We couldn’t operate the way we do without their support.”

Indeed, nowadays, consumers increasingly care about brands that stand for something. And execs believe that these contemporary purchasing habits are contributing to the popularity of B Corp companies that promote social and environmental values.

For us, being B Corp helps fast-track consumer trust.”
— Nicole Bassett, Renewal Workshop

Textile companies hold these same values, but often lack a direct line to the consumer. According to Henry of TS Designs, this may be a reason that so few textile firms exist in the B Corp directory compared to other kinds of businesses.

“In outdoor, for example, companies can sell to customers willing to pay a high price for the goods because they recognize the value of saving the environment and align with B’ Corp values,” explains Henry. “These firms have a more connected customer.”

Renewal Workshop started with goods sold direct-to-consumer establishing a base from which to share the company’s mission. “For us, being B Corp helps fast-track consumer trust,” states Bassett.

Textiles is a cost challenging industry that requires significant capital investment just to get off the ground which presents barriers to becoming certified B Corp. “It’s not like tech start ups with an app, when all you need is air,” states Bassett. “If textiles were to change it would require funding and taking risks in the supply chain.”

Henry adds, “B Corp is still a very niche market, but gives me hope for the future. When I talk to high school kids, they may not be aware of B Corp, however looking beyond price when purchasing a product is becoming more appealing.”